Ahead of Acquisition Binge, Lenovo Quarterly Revenue Tops $10 Billion for First Time
Lenovo, which is in the process of buying IBM’s server business and Google’s Motorola phone business, said Thursday that its existing business topped $10 billion in quarterly revenue, a first for the company.
The Chinese PC giant reported $10.8 billion in revenue, with earnings of $265 million, or two cents per share. The company said it shipped 32.6 million devices, including 15.3 million PCs and 17.3 million mobile devices (phones and tablets). Tablet shipments of 3.4 million were more than triple those of a year ago, Lenovo said.
Next up, Lenovo said, is getting the pending Motorola and IBM server deals through to completion.
“While our top priority now is full participation in the regulatory approvals process, I am confident that from Day 1 after closing, these businesses will quickly begin contributing to our performance and develop into pillars for long-term, sustainable growth,” Lenovo CEO Yang Yuanqing said in a statement.
Revenue from China was about $4 billion — roughly flat from a year ago — while revenue from all other regions grew. In Asia Pacific, revenue rose 22 percent, to $1.6 billion. In the Americas, revenue totaled $2.3 billion, up 36 percent, while that from Europe, the Middle East and Africa, totaled $2.9 billion, a 25 percent year-over-year increase.
Laptops accounted for half of the company’s total revenue, up 11 percent, despite an overall laptop market that saw shipments down 6.3 percent. Desktop PC shipments were up 9.1 percent, with revenue of $3.2 billion, up 12 percent. The unit that houses smartphones and tablets saw its quarterly revenue rise 73 percent, to $1.7 billion.
Update: In a conference call, Yuanqing said that the company will be able to cut material costs and other expenses in both the server and phone businesses to make those units more profitable.
“We know these are absolutely the right investments to secure our future,” he said.