HP CEO’s pay package – Worth its weight in toner?
February 27, 2025
HP’s latest financial report hides a costly truth—CEO Enrique Lores’ pay packet, buried in 103 pages of corporate optimism, equates to a mountain of toner cartridges. As customers grow weary of restrictive policies and frustrating service delays, could HP’s grip on the print market be slipping?
Buried deep within HP’s latest 103-page 22025 Proxy Statement, nestled between the usual corporate optimism and shareholder-friendly figures, lies an eye-watering revelation – CEO Enrique Lores took home a compensation package worth, according the The Register’s brilliant analogy, a whopping 261,658 HP 206 toner cartridges. The 2024 fiscal report, detailing HP’s $53.6 billion (€49.5 billion) in revenue, makes no such comparison, of course, but for those familiar with the company’s pricing strategies, it’s a fitting analogy. You can read the report here.
It’s often said that HP’s real business isn’t in selling printers but in flogging the ink and toner that keep them running. So, it seems only fitting that Lores’ latest pay packet has been helpfully converted into a more relatable metric. That’s $18.0 million (€16.5 million) in stock awards, bonuses, and other perks, all conveniently measured in the stuff that keeps HP’s profit margins as plump as a well-fed corporate boardroom.
To put it another way, if every HP customer who begrudgingly shells out for an extortionately priced toner cartridge were contributing directly to the CEO’s compensation, they might at least expect a thank-you note in the packaging. Instead, they get DRM-laden consumables, firmware updates designed to block third-party refills, and the sinking feeling that they’ve bought into a business model designed to keep their wallets on a perpetual drip-feed. However, for savvy customers, this only underscores the financial and environmental benefits of switching to remanufactured cartridges—offering a sustainable and cost-effective alternative to HP’s locked-down ecosystem.
And when those customers have an issue? HP’s recent decision to enforce a mandatory 15-minute wait time for phone support only adds insult to injury. For those who have spent years battling error messages and cartridge lockouts, this latest policy feels like a deliberate obstacle course rather than genuine customer service. It’s no wonder that more consumers are jumping ship to brands offering fewer restrictions and better support. Ironically, as HP tightens its grip on consumables, it might just be pushing loyal customers straight into the arms of its competitors.
To be fair, Lores did take a small pay cut this year – from a mere 270,315 toner cartridges last year to a more modest stash. The dip in his take-home, however, will likely prove less painful than the squeeze on HP’s core business. While the company continues to buy back shares to keep its stock price stable, its financials tell a more nuanced story of a business navigating familiar pressures in a rapidly changing market.
The numbers game
HP wrapped up fiscal 2024 with $53.6 billion (€49.5 billion) in revenue, a respectable figure but hardly one that sets pulses racing. Growth in the PC and services segments has helped offset declines in traditional print revenue, but even so, profitability remains a balancing act. Non-GAAP operating profit stood at $4.5 billion (€4.1 billion), while free cash flow came in at $3.3 billion (€3.0 billion).
The company’s relentless focus on cost-cutting and “optimisation” means that some of this cash is being returned to shareholders via aggressive share repurchase programmes – a move that conveniently supports stock-based executive pay packages.
The real challenge, however, is whether HP can keep finding efficiencies and maintaining investor confidence when its core markets are not just evolving but, in some cases, shrinking.
Sustainability goals – A step forward?
HP often touts its sustainability efforts, boasting that its Planet Partners recycling program has recovered over one billion cartridges. However, what the company doesn’t disclose is how many new cartridges it places on the market each year. Without this crucial number, it’s difficult for investors and the wider market to assess the true effectiveness of HP’s sustainability goals. Transparency remains a key issue in evaluating whether HP is truly making strides towards a circular economy, or simply offsetting a fraction of its ongoing environmental impact.
HP’s latest sustainability commitments highlight ambitions to achieve net-zero carbon emissions across its value chain by 2040, with interim targets for reducing emissions from product use, supply chain operations, and its own facilities by 50% by 2030. The company continues to emphasize circular economy initiatives, with plans to increase the use of recycled materials in print hardware and supplies. HP also promotes its closed-loop recycling model, aiming to source more plastics from old devices and cartridges, although critics argue that greater support for remanufacturing could be a more effective step toward true sustainability.
Printing – A business in slow decline?
HP’s printing division, which once accounted for the lion’s share of its profits, now makes up around 32% of total revenue. While still a significant chunk of the business, the numbers confirm a slow but steady decline in consumer print demand.
HP is increasingly shifting towards contractual and subscription-based models, with offerings such as the HP All-In Subscription Print Plan, designed to lock customers into monthly payments rather than one-off hardware purchases. The company is also betting big on commercial print services, a segment that is growing faster than consumer printing, but whether this is enough to offset the industry’s broader contraction remains a key question.
There’s also the small matter of sustainability and regulatory pressures. While HP continues to push its closed-loop recycling model, the remanufacturing sector remains an attractive alternative for businesses and consumers looking to reduce waste and avoid restrictive OEM policies. With Europe and other key markets tightening rules around remanufactured cartridges, take-back schemes, and circular economy initiatives, HP’s long-standing reliance on high-margin consumables faces mounting challenges.
Future plans – AI and more subscriptions
Looking ahead, HP is trying to future-proof itself by embedding AI into its product lines – not just in PCs but also in print. The company has been talking up “AI-powered printing solutions”, though details remain vague. One area that is more concrete is the move towards greater workflow automation, particularly in enterprise solutions, where managed print services are increasingly bundled with broader digital transformation strategies.
However, the company’s heavy emphasis on subscription-based models is a double-edged sword. While it provides predictable revenue, customers have been pushing back against an ecosystem that locks them into ongoing costs for hardware they might previously have owned outright.
With hybrid work models no longer driving the same demand for home office printing, and the rise of paperless workflows continuing unabated, HP’s long-term bet seems to be on making itself indispensable through integration rather than outright dominance in any single hardware category.
Final thoughts
While HP remains a profitable and well-managed business, the fundamental challenges in printing remain unchanged. Consumer demand continues to dwindle, while regulatory scrutiny and shifting workplace habits could further squeeze margins in the years ahead.
For now, though, it seems that HP will keep printing money – at least for its executives, even as the print industry itself faces an uncertain future. As for shareholders, they might take comfort in knowing that at least one thing remains predictable – the steady flow of stock buybacks, ensuring that CEO pay continues to look just as polished as a freshly unboxed HP printer.
Categories : World Focus
