Lenovo revenue hits high after strong quarter
Lenovo’s annual revenue rose to a three-year high, led by doubledigit sales growth in the fourth quarter, as business at its personal computer (PC) and smart devices segment improved, the Chinese group said.
The PC business would continue to see premium products such as gaming PCs and workstations driving revenue growth, chief operating officer Gianfranco Lanci said.
“I think the company is in much better shape than it was six [to] nine months ago,” he said on Thursday, adding that Lenovo was now the world’s top gaming PC maker.
Shares of the company rose as much as 4% on the news.
Lenovo, which lost the world’s largest PC-maker crown to HP in 2017, has seen its core business suffer from a shrinking market globally, while its smartphone business struggles to stay ahead of fierce competition. But in the fourth quarter ended March, its revenue from the PC and smart devices business jumped 16%, accounting for almost three-quarters of a total $10.6bn for the period.
For the year, Lenovo’s revenue came in at $45.35bn, up 5%, with gaming PC revenues almost doubling.
Lenovo, however, posted a loss attributable to shareholders of $189m for the year, versus a $535m profit a year ago, on higher component costs, a $400m tax writedown and a lacklustre smartphone business. It was the company’s biggest loss since 2009 and wider than an average analyst estimate for a loss of $161.3m from 17 analysts polled by Thomson Reuters. Annual revenue from the mobile business, Lenovo’s secondlargest, fell 6%.
The company, which missed a March deadline to turn around the business, said it would focus on reducing losses in the segment by focusing on profitable markets such as Latin America and North America.
Chairman Yang Yuanqing said Lenovo also aimed to be among the world’s first to roll out 5G phones, late in 2018 or early 2019, with Qualcomm’s next-generation Snapdragon 855 chips.
Lenovo’s phone problems started after it bought Motorola Mobility from Google for $2.9bn in 2014 but struggled to integrate the assets.
Yang declined to give a specific target turnaround date for Lenovo’s mobile and data centre businesses.
“I think our data centre business’s momentum is much stronger. If we continue this, definitely we will break even soon,” he said.