Lenovo profit falls less than projected as PC market stabilizes
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Beijing: Lenovo Group Ltd.’s quarterly profit fell less than expected after the global personal computer market eked out growth for the first time since 2012.
The world’s second-largest PC maker reported a 41% slide in net income to $107 million in the three months ended March. That compares with the $97.9 million average of analysts’ estimates compiled by Bloomberg. Revenue increased 5% to $9.6 billion, compared with the $9.65 billion projected.
Lenovo narrowly lost its top position in global PCs to HP Inc. in the quarter but managed to increase market share as industry shipments grew 0.6%, the first time they’ve risen since early 2012 according to IDC. Lenovo’s biggest rival posted better-than-expected revenue growth as the market stabilized.
Overall demand however remains depressed and Lenovo needs to tap new sources of growth or turn around an under-performing smartphone division. It’s re-enlisted the executive who steered the acquisition of Motorola to run its Chinese PC arm, shaking up its senior ranks to breathe new life into a stagnating business.
“Any sign of stabilization of operating performance of mobile business group should build market confidence in Lenovo’s capability to achieve a break-even in the second half of fiscal year 2018,” Mark Po, a China Galaxy International analyst, wrote in a memo ahead of the earnings release. Bloomberg