15th August 2014

Lenovo Profits Leap as More Acquisitions Targeted

Chinese PC manufacturer Lenovo has announced a 23% increase in net profits, with the firm saying it will continue to look for acquisition opportunities.

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Lenovo Profits Leap as More Acquisitions Targeted

Announcing the results for Q2, the world’s biggest PC maker saw profits rise to $214m (£128m). Revenue for the same period also rose significantly to $10.4bn, up 18% compared to the same period in 2013.

With its core business in PCs the firm saw nearly half of its total revenue come from this stream.

More of a surprise was the increase in laptop sales, up 12% for the quarter, despite an industry downturn. The increasing popularity of tablet devices helped see a 3.7% decline in laptops being shipped compared to last year.

However, Lenovo performed well in tablets too, as well as other mobile devices, helping the company remain as the leader in its field.

A Quarter of Milestones

A statement about the firm’s Q2 earnings was released by chairman Yang Yuanqing, saying:

“This has been a quarter of milestones for Lenovo – record PC share, a number three ranking in worldwide tablets for the first time and an even stronger number four global smartphone position.”

What will make the news even more pleasing for the firm is the success of its move into other markets, as desktop PCs sales have slumped. Laptops too are going to continue to decline, as tablets and smartphones become the go to gadget.

Indicative of this, Lenovo posted sales of more smartphones than it did PCs. Achieving a record figure of 15.8 million sold units, it represented a 39% increase from 2013.

Mr Yang also went on to explain that the smartphone sector is moving away from high-end and into the more mainstream marketplace.

Remarking on the success of its acquisitions of IBM’s low-end x86 server unit and Motorola Mobility from Google – both likely to close in Q3 – he also hinted at further acquisition opportunities that Lenovo would try to exploit.

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