Do you want AoE damage/waveclear? 
Do you want single target burst damage (through animation cancelling)?
Do you want sustain?
Do you want AD?
I'm not saying the item is OP, but I feel like it's useful in almost all situations, barring ranged champions, AP champions, and Nasus (since Q damage isn't applied through Hydra). Am I missing something here?
FalconPawwwwnch2 votesBecause it falls off very hard if its your only damage item
Most bruisers would prefer Bork/trinity/cleaver because they don't fall off like hydra does
I.e. Bork Renekton/Trundle would destroy Hydra Renekton/Trundle
Hydra is good on champs who build a lot of armor pen and wanna be an assassin like Riven
A bad Malzahar2 votesTrundle destroys Renekton with any build.
Ionian1 votesWhen your champion scales very poorly with AD. 
50000000000000001 votesI see your point, but isn't Hydra a great item on Poppy?
Ionian1 votesDon't think so, a huge portion of her damage comes from Q which is % hp damage. I mostly see people building Triforce and then cdr tank items (like an Irelia build).
Trebbi1 votesWhen you want more attack speed? :,)
YossarianSensei1 votesWhen you're ranged
Krinu1 votesI was going to say Nasus (not because it doesn't apply Q damage, but because it makes it harder to farm stacks) but you already mentioned it.
Only Play Darius1 votesBecause AD bruisers usually get kited to hell, and often even 1 damage item is too much if they wan't to last any amount of time on the front line. In high elo people will kite you 100-0 before you can even get in range for hydra, so often it's like not having an item in that slot.