Lenovo Delivers Outstanding Q1 Performance and Strong Growth, Overcoming Challenging Global Environment
Lenovo Group (HKSE: 992) PINK SHEETS: LNVGY) today announced Group revenue in the first quarter of US$13.3 billion, up almost 7% year-on-year (up 10% year-on-year excluding currency impact). Pre-tax income grew 38% compared to the same quarter a year earlier, to US$332 million, while net income also increased by 31% year-on-year to US$213 million. Basic earnings per share for the first quarter were 1.80 US cents or 13.95 HK cents.
“Our outstanding performance last quarter proves that Lenovo has quickly regained momentum from the impact of the pandemic and is capturing the new opportunities emerging from remote working, education and accelerated digitalization,” said Yang Yuanqing, Lenovo Chairman and CEO. “While the world continues to face challenges, Lenovo is focused on delivering sustainable growth through our core businesses as well as the new services and solutions opportunities presented by our service-led intelligent transformation.”
Global economic factors
The last quarter has presented multiple industry-wide business challenges, including ongoing geo-political uncertainties and the COVID-19 pandemic. To chart a path through these challenges, Lenovo continues to leverage its core competencies of operational excellence and a ‘global sourcing, local delivery’ approach. Looking to the geo-political landscape, Lenovo continues to believe that cooperation in trade, technology and culture provides significant economic benefits to all markets and will ensure that technology can benefit and empower everyone in society.
Business Group Overview
Lenovo’s Intelligent Devices Group (IDG) continues to lead the company’s strong performance. The PC and Smart Devices Group (PCSD), one of the two IDG business units, grew revenue by double digits year-on-year to US$10.6 billion. Pre-tax income reached US$670 million, up nearly 28% year-on-year, while industry-leading profitability improved by almost 1 point to a new record of 6.3%. The PC market significantly outperformed the industry forecast of a market decline, with Lenovo retaining its #1 leadership position in the worldwide PC Devices market (PC and Tablets). Similarly, there was strong year-on-year growth (45%) in Consumer business revenue worldwide. Driven by these successes, revenue grew 30% in EMEA and 18% in China. Volume in high-growth and premium categories such as Gaming, Thin & Light, Visuals, and Chromebooks all continued to grow at high double-digits. The worldwide e-Commerce business was a notably stellar performer, with revenue growth over 50% year-on-year.
Looking to the future, the company expects this strong PC demand will be a long-term trend. As a result, Lenovo will focus on innovative products that adapt to the new global environment, further strengthen its global supply chain to meet the fast-growing demand, continue to develop its e-Commerce platform and focus on high-growth segments to drive premium-to-market growth with leading profitability.
IDG’s second business unit, the Mobile Business Group (MBG), while still impacted by COVID-19 and challenging currency exchange rates, has improved momentum with revenue increasing by 33% over the last quarter. Although revenue declined year-on-year, volume outgrew the market year-on-year in key markets like Latin America, North America and Europe, with record high market share in both Latin America and North America. Looking forward Lenovo will continue to leverage its strong product portfolio, innovative technology, particularly in 5G, and expand carrier ranging to resume profitable growth.
The Data Center Group (DCG) resumed hypergrowth, with revenue growing almost 20% to US$1.6 billion and profitability improving year-on-year. Notable successes included Cloud Service Provider business (previously called hyperscale), which grew more than 30% year-on-year, setting a new revenue record by capturing strong public cloud infrastructure demand driven by increased digital consumption due to COVID-19 lockdowns. Meanwhile, the customer base continues to grow thanks to customized in-house design and manufacturing capabilities and an expanded cloud services provider salesforce. Enterprise and SMB business (previously called non-hyperscale) delivered year-on-year revenue growth, led by double-digit revenue growth in high-growth segments such as Software Defined Infrastructure and Services, as well as High-Performance Computing. Looking ahead, we expect long-term growth in the Cloud Service Provider segment and will leverage the team’s existing strength in public and private cloud to expand the Edge computing business.
Lenovo’s Intelligent Transformation continues to show strong progress as a result of determined execution of the 3S strategy. Overall Software and Services revenue* grew 38% year-on-year to over US$1 billion, now accounting for around 7.6% of Group revenue. Smart IoT revenue* grew 39% year-on-year, Smart Infrastructure was up 16% and Smart Verticals* up 65%, driven by Smart City solutions in China and Smart Healthcare solutions in North America. Attached Service* grew 32% year-on-year, Managed Service* (including fast growing Device as a Service) grew 48% year-on-year and Solutions* grew 54% year-on-year.
* invoiced revenue
Lenovo (HKSE: 992) (ADR: LNVGY) is a US$50 billion Fortune Global 500 company, with 63,000 employees and operating in 180 markets around the world. Focused on a bold vision to deliver smarter technology for all, we are developing world-changing technologies that create a more inclusive, trustworthy and sustainable digital society. By designing, engineering and building the world’s most complete portfolio of smart devices and infrastructure, we are also leading an Intelligent Transformation – to create better experiences and opportunities for millions of customers around the world. To find out more visit https://www.lenovo.com, follow us on LinkedIn , Facebook, Twitter, YouTube, Instagram, Weibo and read about the latest news via our StoryHub.
About Business Wire
For more than 50 years, Business Wire has been the global leader in press release distribution and regulatory disclosure.
Subscribe to releases from Business Wire
Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from Business Wire
International AI Art Competition Enters Final Round30.9.2020 19:16:00 EEST | Press release
Ten finalists have been announced for AI Artathon, the first ever international AI Art competition held in Saudi Arabia. The finalists were revealed during a livestream event to showcase artworks created by the competitors using artificial intelligence tools and techniques. The three winning teams will be announced at the Global AI Summit on 22nd October, where they will share a prize of US$133,000. The AI Artathon is an initiative of the Global AI Summit, to highlight the creative potential of humans and machines working together to create innovative artworks. Twenty teams made up of artists, graphic designers, AI experts and programmers, competed in this stage of the competition, after qualifying during a hackathon held in Riyadh in January. Over 2,000 people from over 50 countries applied to participate in the hackathon, with 300 selected for the three-day event, where teams were formed to develop initial AI art concepts. Twenty teams were selected to take part in a bootcamp, where
VALBIOTIS Publishes Its 2020 Half-Year Results and Provides an Update on Its Global Strategic Partnership with Nestlé Health Science, its strong Financial Visibility and the Promising Advances in Its Pipeline30.9.2020 18:40:00 EEST | Press release
Regulatory News: VALBIOTIS (Paris:ALVAL) (FR0013254851 – ALVAL / eligible for the PEA/SME), a Research & Development company committed to scientific innovation for preventing and combating metabolic diseases, announces its results for the first half of 2020 and provides an update on developments since the beginning of the year. Sébastien PELTIER, CEO of VALBIOTIS, commented: "Events in the first half of 2020 have transformed our outlook and helped further boost our international recognition. With the signature of the development and marketing partnership for TOTUM-63 and the launch of the final clinical phase for this Nutrition Healthcare product, entirely financed by Nestlé Health Science, we have demonstrated the soundness of our development model. We are now moving confidently towards marketing and claim submission for TOTUM-63 and, thanks to a solid financial position, we are also working to apply this same model to the rest of our Nutrition Healthcare portfolio. At the head of the
Bittrex Global to Operate Cryptocurrency Exchange From Bermuda30.9.2020 18:16:00 EEST | Press release
Bittrex Global (Bermuda) Ltd. received a full Class F Digital Assets Business Act license to operate its acclaimed cryptocurrency exchange under the supervision of the Bermuda Monetary Authority (BMA). The Bermuda-based entity will provide Bittrex Global with an additional important gateway for global accounts. From its Bermuda hub, Bittrex Global (Bermuda) will offer additional digital asset services over time subject to further approval by the BMA, such as futures. “The entire crypto industry is about looking forward,” said Bittrex Global’s CEO Tom Albright. “Working with the Bermuda Government and the BMA to be part of another regulatory community that keeps innovating is extremely exciting and is an important step in increasing crypto’s penetration at all levels of the financial industry.” Bermuda Premier David Burt added “attracting Bittrex Global to Bermuda is a significant achievement. As one of the leading global exchanges, Bittrex Global’s choice of Bermuda for expanding their
GA Telesis Plans to Deliver Renewed Confidence in Air Travel Through its New Global Distribution Agreement with Honeywell for a State-of-the-Art UV Cabin Cleaning System30.9.2020 17:50:00 EEST | Press release
In an effort to help restore confidence to the flying public, GA Telesis, LLC, has teamed with Honeywell and entered into a distribution agreement to act as a global distributor for their UV Aircraft Cabin Cleaning system. This partnership is another step in the development of GA Telesis’ Tarmac Solutions Group's ability to offer a fully comprehensive Specialized Tooling and Ground Support Equipment solution for airlines around the world. This cabin system utilizes Ultraviolet (UV) light to quickly traverse an aircraft cabin, galleys & lavatories in less than ten minutes. In addition to measures already being taken by airlines in flight like the use of cabin air exchange and HEPA filters, this new system, when properly applied, reduces certain viruses and bacteria on airplane cabin surfaces and can assist in creating a cleaner environment for passengers and crew after the airplane lands and before each flight. The UV cabin cleaning system is intended to help instill confidence to busin
Velodyne Lidar Announces Inaugural Trading on Nasdaq Global Select Market30.9.2020 16:31:00 EEST | Press release
Velodyne Lidar, Inc. (Nasdaq: VLDR, VLDRW) today announced shares of its common stock and warrants have begun trading on The Nasdaq Global Select Market under the ticker symbols “VLDR” (common stock) and “VLDRW” (warrants). This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200930005166/en/ Velodyne Lidar is the first public pure-play lidar company and is known worldwide for its broad portfolio of breakthrough lidar technologies, including revolutionary sensor and software solutions. (Photo: Velodyne Lidar, Inc.) Velodyne is the first public pure-play lidar company and is known worldwide for its broad portfolio of breakthrough lidar technologies, including revolutionary sensor and software solutions. These innovative technologies deliver performance, quality and flexibility to meet the needs of a wide range of industries such as autonomous vehicles and growing new markets. Currently, Velodyne serves the automotive industry with
97% of PeopleSoft Licensees Believe Current Releases Meet Their Needs30.9.2020 16:00:00 EEST | Press release
Rimini Street, Inc. (Nasdaq: RMNI), a global provider of business software products and services, the leading third-party support provider for Oracle and SAP software products and a Salesforce partner, today revealed significant findings from its recent survey of Oracle PeopleSoft licensees, which was conducted to better understand licensees’ software product and release roadmap strategies, current challenges and application support and operating plans. The survey highlights that an overwhelming 97% of respondents believe their current PeopleSoft releases meet all or most of their business needs. Further, many licensees are taking steps to maximize the value and extend the lifespan of their robust and mature current releases, including moving their PeopleSoft software to a cloud hosting platform, utilizing Application Management Services and switching their annual support to third-party support providers like Rimini Street. This press release features multimedia. View the full release
In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.Visit our pressroom