Offering a Tank Full of Opportunity for Home and Home Office Working Spaces – The Six Five On the Road

Patrick Moorhead: The Six Five is on the road here in Las Vegas. We are at HP Amplify 2024 Partner event. Wow. I mean, we have seen some of the coolest technologies. The keynote speakers, the bevy of CEOs that were brought in were incredible to really talk about hybrid work and the magic of AI and how to make it better. And Dan, we’ve also talked a lot about services and solutions that get layered on top of the stack. It’s been a great show.

Daniel Newman: Yeah, it’s been great to see. You could call it an evolution, perhaps you could call it a revolution in what is going on with HP and then of course within its partner community, a very partner-led, partner-focused company. But yeah, I do like that you pointed to, it was a who’s who. I mean, let’s call it what it is. It was a who’s who. You know Sundar Pichai, you have Satya Nadella. And again, I don’t want to not name anybody, but we’ve talked about all of them here on the show. And Pat, it’s because we’ve got this inflection. We’ve got AI, we’ve got the AI PC, we’ve got revolutions in work, and of course print.

Patrick Moorhead: That’s exactly right. And just some very important background. Printing is not only important to Workforce, but also for consumers. By the way, and also for HP business, it’s a third of the revenue, but it’s 66% of the profit dollars. It is a big and important business at HP. And let’s talk about consumer print, tank solutions. Sue, welcome to The Six Five.

Sue Richards: Yeah, thank you. Happy to be here.

Patrick Moorhead: Thank you.

Daniel Newman: Tank solutions. Yes, absolutely. Well look, there’s-

Patrick Moorhead: I have not evolved to tank yet at home. I’m just like this instant ink cartridge guy, so I need to make the move, Sue.

Sue Richards: It’s all about convenience. Yes. I think that that is the key trend that we see with our customers, right? It’s all about convenience.

Patrick Moorhead: Yeah.

Daniel Newman: It’s like the perma-charged EV.

Patrick Moorhead: It is.

Daniel Newman: With the 0 to 60 in one second or whatever they’re trying to put out there.

Patrick Moorhead: Listen, I want some sort of helicopter to deliver my ink to my door right when I run out and have it put it in there. I hope you’re working on that, Sue.

Daniel Newman: You don’t care what it costs. So let’s start off with talking a little bit about the needs and opportunities for the home. Every home is kind of a small business now. Rightfully so.

Sue Richards: Every home changed, right? If you think about what happened in the pandemic, I think what the home serves for us all is not only a place where we take care of our home business, take care of our kids and their needs to go through school. But for me, at least one day a week, it’s my office, it’s my work office. And that place that home has changed to, it really has to be able to have the ability to be able to work from home, to be able to print from home, to be able to create from home. And home is really serving many more purposes than it used to. And that’s a key trend from our consumer print category is that the print needs that used to be in the office have now been pulled into home.

And this is where print is still a key use case of key need. We saw during the pandemic that print was essential. It’s in secular decline. We are still seeing though, when people need to print, they need to print. And the expectation is that it’s simple, that it’s seamless, that it’s frictionless. And that is a key trend that we are seeing with our customers and why we want to make sure from an HP point of view, we’re offering that convenience. And whether it’s through our Instant Ink and our subscriptions plans that we’re bringing to market or whether it’s from having all of that ink up front and available and seamless and frictionless, we’re going to offer that for our customers as well.

Patrick Moorhead: Yeah, it has been really impressive. I mean, I remember 10 years ago it was like the dread of, “can I get this printer to work? My gosh, I forgot I didn’t have ink. I’ve got my passport application in. I need to close on a house. I need to print out something to get notarized.” And you’re jetting out to 24/7 Walmart or something to go pick this up. Just anybody who has ink when I need it. So let’s talk about Smart Tank. First of all, what is it and how does it add to the convenience maybe over and above Instant Ink?

Sue Richards: So what we see is that there are actually a couple types of customers who want their convenient delivery very differently. So it is the folks that want it on demand when they need it. And we have in-sync services that will essentially we’ll know what those customers are printing from a volume point of view, and we’ll proactively ship them cartridges before they need it. Perfect, it is like magic.

Patrick Moorhead: It is like magic, I mean, it literally shows up before I’m going to run out.

Sue Richards: Exactly.

Patrick Moorhead: And they show up at my door and it’s great.

Sue Richards: But there’s also those customers that really want to not worry about it and want to have it in bulk. They’re willing to pay up front 3x, 4x amounts of a traditional or even a service printer to have that in bulk. And I think of those more like your bulk shopping customers.
I’ve got a house, I’m going to go to Costco, I’m going to buy what I need in bulk, especially for those home essentials because I just don’t want to think about it or think about running out. And for me with kids, it’s toilet paper. I just don’t want to worry about it. For some of our customers with printing and ink, they don’t want to worry about it.

Even though I could give them a service. They just really don’t want to think about it. They want that convenience, they want that trust of HP that it’s going to be there when they need it. And they want that guarantee of HP quality as a print leader for the last 30 plus years. They know they’re going to have it with HP and have a simple seamless experience with our tank printers. And we’ve been making a lot of strides over the last year toward really expanding our portfolio, going broader than we have before, and really being able to bring the best experience to tank printing in the industry.

Patrick Moorhead: Yes.

Daniel Newman: So maybe I’m naive.

Patrick Moorhead: Possibly.

Daniel Newman: By the way, as an analyst, it’s rare that I would ever say there’s something, but print is something you probably leading this business. You eat, sleep, drink, wake, think you’re talking about best. I think about, “okay, did it print or did it not print?” What does that mean?

Sue Richards: Yeah, I think a couple of things. So I’ve grown up in print for the last 30 years. Started in the core technology when color inkjet printing was just coming of age.

Daniel Newman: That’s pretty cool.

Sue Richards: It’s been amazing to see that journey for not only myself before our customers and the fact that my kids take it for granted. So what does that mean “the best”? In my point of view it’s-

Patrick Moorhead: It’s not like #winning right there.

Daniel Newman: I don’t think we use hashtags anymore.

Patrick Moorhead: Oh, that’s right. Yeah.

Daniel Newman: For old people like us, it

Sue Richards: It’s really being able to provide our customers a great simple setup experience. We’re going to be able to get them set up and printing the fastest. One of the things that we’ve been able to bring with our 30 years of technology is a capability so that when you set up your printer, you fill your tanks, you can start printing right away. You don’t have to wait for all that ink to be pulled through the system to be purged into a waste tank. Essentially, we are bringing all that ink right where it belongs on the paper for your printout. And so it’s really that ability to print more and to waste less.

And for our customer, it’s cost-effective. It’s really being able to not have to worry about changing out a waste tank at some point in the future because it got filled and their printer stopped. It’s really being able to focus on what that customer wants, what they need, and how do I get them there in the simplest way possible without them having to think about it. Because if you have to think about it, you’re frustrated by it. And that’s what we’re focused on.

Patrick Moorhead: So in briefings, press releases, I’ve seen “We have the easiest to use tank printer.” Is that scientific? Is that marketing? Which by the way, I appreciate marketing. Is that tested by a lab? What do you mean by that?

Sue Richards: So from a customer experience point of view, it’s your time to set up and time to start printing and not wait. So there’s a time component and a waiting. You don’t want to have to wait. You don’t want to be stopped in the middle of your print job because your waste tank is full. So it’s really eliminating those friction points throughout their entire journey. Using our smart app, you’re guided on how you set up that printer and being able to print from anywhere, right?

And whether it’s anywhere in your home, whether it’s in that office, being able to print from multiple devices, our smart app lets you really set up that printer seamlessly, guides you, helps you with support, but then also brings content to you on your phone for whatever you might be looking for. Whether it’s learning guides for your kids, whether it’s coloring pages to keep them busy. We’re really bringing that entire end-to-end customer mindset when we think about “The best tank printer ever.”

Patrick Moorhead: Yeah. So Dan, you’re on your phone nonstop. That’d probably be good for you.

Daniel Newman: I don’t use a phone. What are you talking about? Look, I mean, for you boomers…

Patrick Moorhead: Gen X, Gen X.

Daniel Newman: That’s what you keep saying. As a millennial, I grew up this way. Now listen, we appreciate a little humor and a little levity here, but I’m not on for more than 14 hours a day. I don’t care what you say. Sue, I was in Chicago last year. I remember jumping room to room into some of the sessions at the partner conference and sustainability was everywhere. And while AI PC has maybe taken a little bit of the headlines this year, I know sustainability is deeply entrenched in the HP ethos. Talk a little bit about your book, your business, and how is this all driving towards those sustainability objectives?

Sue Richards: So we have an objective and ambition to be the world’s most sustainable and just technology company. Period, full stop. That thread is pulled through the way we develop our products. It’s pulled through how we operate in our communities. It’s pulled through how we do business, how we source materials, and how we innovate to really continue to be more and more sustainable. So from a tank point of view, we have the highest level of post-consumer recycled plastic in tanks that exist. And so we are having to engineer to do that. It’s not easy but we do it, and we’re continuing to put more and more post-consumer recycled material into our printers.

From our packaging point of view, this is really where we’re moving more and more toward paper-based packaging from certified sources and driving that. And we’ll be driving that across our entire portfolio. So these are areas that we are really driving and delivering to that ambition along with our forest commitments where we’re investing to protect and to preserve our forests for every page is printed from an HP printer. So these are those areas that have been ingrained and have been a part of this HP legacy for as long as I’ve been there and as long as we’ve been a company. So it’s really walking our talk every day in every part of the value chain and development, all the way through to our customer.

Patrick Moorhead: Yeah.

Daniel Newman: These are very measurable, sustainable, achievable. Sue, thanks so much for joining us here on The Six Five.

Sue Richards: Yeah, thank you. Great to be here with you both.

Patrick Moorhead: Yeah, definitely.

Daniel Newman: All right, everyone. Hit that subscribe button. Join us for all the coverage here at HP Amplify 2024 in Las Vegas. Lots of great conversations. Try to watch them all. But for this one, Patrick and I got to say goodbye. We’ll see you all later.