Lenovo sees US$189m net loss on one-time charge

CHINESE technology giant Lenovo yesterday said it recorded a US$189 million net loss for its full fiscal year due mainly to a one-time charge, while saying it was planning an overhaul to broaden its appeal.

The Beijing-based company also reported a 69 percent decline in profit in its fourth quarter ending March 31. Quarterly profit was US$33 million, compared to US$107 million in the same quarter last year.

Revenue in the fourth quarter rose 11 percent annually to 10.6 billion, the first double-digit gain in 10 quarters, while full-year revenue was up five percent, it said in a statement to the Hong Kong Stock Exchange.

Full-year profit was hit by a US$400 million non-cash write-off charge from deferred income tax assets, the company said.

Lenovo continues to be weighed down by the poor performance of a subscale mobile segment despite an improved datacenter business, Johnathan Ritucci, a Bloomberg Intelligence analyst, wrote ahead of the release.

“Its US PC franchise strategy also needs to be confronted quickly, as (rival Hewlett-Packard) continues to gain segment share,” he said.

Lenovo said it will combine its personal computer group, smart devices and mobile business into an “intelligent devices group,” transforming itself from a single PC hardware company into multi-business group.