On Aug. 23, HP Inc (HPQ 1.55%) reported its third-quarter financial results. The company said that it took in $14.6 billion in revenue, growing 11.7% year over year (8.8% in constant currency). Earnings per share on a non-GAAP basis came in at $0.52, which the company says grew 21% year over year and was at the high end of its guidance range of $0.49 to $0.52. 

During the conference call that accompanied this earnings release, management provided some additional insight into the business. Let's take a closer look. 

Share gains in the PC market

HP's personal systems business, which consists of sales of notebook computers, desktop computers, workstations, and "other," saw revenue jump 12% year over year.

"HP continued to outperform the PC market in the second calendar quarter, growing market share with broad-based growth across regions and product categories," HP CEO Dion Weisler told investors. "While we're proud of these results and the team's efforts, share gains continued to be an outcome of our innovation for customers and not an objective of our business." 

Three HP laptops.

Image source: HP.

Earlier on the call, Weisler said that the company's goal with respect to its personal systems business is "profitable growth." 

Although it might seem a bit strange that HP's CEO says that the company aims to deliver "profitable growth" while at the same time saying that share gain is "not an objective of our business," it makes sense. Gaining market share in itself isn't necessarily difficult -- it can be done by pricing aggressively relative to the competition. Such a strategy, however, isn't necessarily going to maximize HP's business performance and, by extension, shareholder value. 

Instead, as the company outlined at its analyst day late last year, it's trying to gain share in "higher margin segments" like premium consumer PCs as well as gaming PCs. 

The strategy seems to be working. Last quarter, HP reported that its revenue from notebook computers was up 13% year over year on a 6% increase in unit shipments. It said that revenue from desktop computer sales rose 12% year over year, with unit shipments up 7%. Its personal systems group saw a $52 million boost to operating income, to boot. 

Checking up on the 3D printing story

HP is trying to become a major player in the 3D printing market, and management seems downright enthusiastic about the opportunity.

"We are still in the very early stages of this business, but remain excited and optimistic with our ability to disrupt the $12 trillion global manufacturing market," Weisler said on the company's most recent earnings call. 

There were a couple of interesting items from the call that investors interested in HP's 3D printing business should probably pay attention to. 

First, Weisler said that HP "drove installations with industrial-grade customers, including the new 3D printing center in China, the world's largest manufacturing market." He then said that the company is "encouraged by the increasingly wide array of final part applications across sectors, including the industrial, consumer, auto, and healthcare markets." 

The executive also said that HP "expanded [its] strategic partnership with Siemens, providing design software support for our full-color platform."

HP described its full-color platform as "the industry's first 3D printing technology to enable manufacturers to produce engineering-grade, functional parts in full color, black or white -- with voxel control -- in a fraction of the time of other solutions." 

Another interesting 3D printing-related item from the call was that the head of HP's 3D printing business, Stephen Nigro, "has made the decision to retire in early 2019." He'll be replaced by Christoph Schell, whose current title is "president of the Americas region."

Capital returns

Last quarter, HP bought back $696 million worth of stock and paid $223 million in dividends, adding up to $919 million in capital returns for the quarter.

"For the full year, it is now more likely that we will deliver [capital] returns above the high-end of our FY 2018 outlook of 50% to 75% of free cash flow," HP CFO Steve Fieler said. 

During the call, analyst Toni Sacconaghi observed that when HP Inc and Hewlett-Packard Enterprise (HPE 0.59%) were split into their respective entities, HP Inc's capital return strategy "was more balanced between dividends and buybacks." 

Sacconaghi then asked, "Is there an incremental bias to buybacks, and should we expect this kind of ratio on a go-forward basis?" 

Fieler told Sacconaghi that the company's capital allocation strategy is "working" and that it has been "active in buying back shares" because the company "saw an attractive opportunity to do so, and so we took advantage of it." 

"As it related to the dividend[s] themselves, our Board does consider dividend policy periodically," Fieler said. "If we have any update or changes, we'll certainly communicate that to you."