Brexit? HP Inc laughs in the face of Brexit! Hard or soft, PC maker claims it's 'no significant risk'

Must just be the rest of the tech industry then

Continued uncertainties caused by Brexit may be giving all sorts of businesses sleepless nights – but HP Inc claims it isn't among them.

The world's second-largest PC maker – and the largest in Britain – made the bold statement in its latest set of profit and loss accounts for the year ended 31 October, filed with Companies House this week.

"Following the referendum in 2016, we have been assessing the potential impact of Brexit on HP Inc UK," the firm said. "While there is still uncertainty as to the timing and nature of the UK's exit from the EU, we do not believe Brexit will pose a significant risk to our business."

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The EU has allowed the UK to extend its departure until 31 October, but whether that happens remains questionable. Britain has already been forced to ask the trade body to extend D-Day twice under outgoing PM Theresa May.

The two remaining candidates in the running to be the next leader of the Tory party appear hellbent on trying to tell the British public that they can offer the hardest Brexit possible. Boris Johnson has insisted the UK will hotfoot it out of the EU by the end of October, and his rival Jeremy Hunt expects Britain to be out by the end of the year.

The impact of Brexit on IT to date has been the price rises from vendors to counter the falling valuation of the pound versus the US dollar, and continued uncertainty of when or if the UK will leave.

Analyst Canalys warned in October that a so-called hard Brexit would be disastrous for the economy, in the short term at least, and may lead to a recession that will dampen enterprises' spending on IT. The channel has been making contingency plans for months and months in a bid to avoid product shortages, etc.

HP said in its accounts that by "developing a greater understanding of partner and consumer needs, HP Inc have been able to implement global cost reduction strategies to ensure that despite the channeling economic climate the company can maintain its underlying profitability."

The supply concerns highlighted in more recent results (Q1 and Q2) might be more worrying for the company – people are printing fewer pages and HP miscalculated this in a major way.

That said, the company's exposure to the UK is obvious: HP sold 2.6 million computers locally in calendar 2018, up 2 per cent year-on-year, giving it a market share of 29.9 per cent, according to IDC. The next nearest rival was Lenovo with a 21.8 per cent of total sales.

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Malini Paul, research manager at IDC, told us the Windows 10 refresh had driven sales in Britain, and claimed some enterprise and public sector organisations had also brought forward spending schedules.

Paul said that due to Brexit, IDC is forecasting a slowdown in sales to be flat or possibly even negative with year-on-year comparison over the next couple of quarters.

HP sales in fiscal '18 (PDF) grew to £1.532bn from £1.399bn the year before, and it reported an operating profit of £27.22m versus £12.67m. ®

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