HP Inc's stock tumbled 5.49% in pre-market trading on Wednesday, extending losses from the previous session after the company issued a cautious financial outlook despite reporting better-than-expected quarterly results.

The decline came as HP management indicated that full-year fiscal 2026 results are now expected to be at the low end of the company's guidance range. The primary concerns cited are sharply rising memory chip costs, driven by surging artificial intelligence demand, and ongoing uncertainty from U.S. trade regulations and tariffs.

Chief Financial Officer Karen Parkhill stated that the company faces "a dynamic environment marked by increasing memory costs," with these headwinds expected to persist through the fiscal year and potentially into the next. The company is implementing price increases and additional cost reductions to mitigate these effects, but investors remain concerned about the pressure on margins.