Lenovo announced today much better than expected results for the quarter ending December 31, with a net profit of $233 million on revenues of $14.04 billion. Of particular note, sales from the firm’s PC and smart devices division jumped 12 percent to a record $10.7 billion.
“When we set out on our journey of Intelligent Transformation, our goal was to restore and then accelerate Lenovo’s business momentum, while providing our customers and partners with the best technologies in smart IoT, smart infrastructure and smart vertical solutions,” Lenovo chairman and CEO Yang Yuanqing said in a prepared statement. “We’ve done exactly that and more. Our strength and position as the industry’s most prolific global technology organization is firmly established. What I’m most pleased to see is how Lenovo is bucking the current industry trend. We’re strong, have delivered record-breaking results this quarter and are only getting stronger.”
Lenovo emerged from 2018 as the world-biggest PC maker, with 25 percent market share, having eclipsed HP earlier last year. But even more impressive is that the firm’s PC business delivered record revenues in a quarter in which much of the rest of the PC industry was down, allegedly because of an Intel chipset shortage. PC sales were up 16 percent by revenue, Lenovo says, outperforming the market by over 17 points.
“A focus on high-growth and premium segments saw Workstations, Thin and Light devices, and Visuals revenue outgrow the market by more than 30 points, Gaming by 16 points, and Chromebook by over 220 points,” Lenovo reported.
Even Lenovo’s struggling mobile division performed well in the quarter and it delivered its first-ever worldwide profit since the firm purchased Motorola in October 2014. Lenovo credits ongoing cost reductions, a streamlined product portfolio, and a focus on core markets for the change. North America, notably, saw a “breakthrough” quarter with unit sales outgrowing the market by 40 percent.
But with over three-quarters of its revenues coming from its PC business, Lenovo is, of course, primarily a PC maker. And its success in the most recent quarter hints at a healthy 2019 and, better still, perhaps even a bit of a broader PC industry turnaround.
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