Lenovo Q2 Momentum Powered By 9th Consecutive YoY Quarterly Revenue Growth, Strong, Positive PTI and Net Income Growth
7.11.2019 07:20:00 EET | Business Wire | Press release
Lenovo Group (HKSE: 992) (PINK SHEETS: LNVGY) today announced Group revenue in the second quarter reached US$13.5 billion, the ninth consecutive, year-on-year quarter of growth. Pre-tax income grew 45% compared to the same quarter a year earlier, to US$310 million. Net income also increased 20% year-on-year to US$202 million. Revenue mix continues to be balanced across the company’s four geographies (Americas, Asia Pacific, China, EMEA) with each reporting more than 20% share of revenue.
Basic earnings per share for the second quarter were 1.69 US cents or 13.23 HK cents. Lenovo’s Board of Directors declared an interim dividend of 6.3 HK cents per share.
“During the quarter we were pleased to see our growth momentum deliver continued solid financial performance amidst a complex and dynamic global trading environment. This success is a testament to our commitment to innovation, to our customers across 180 markets around the world, and to how the world continues to embrace our vision to deliver smarter technology for all,” said Yang Yuanqing, Lenovo Chairman and CEO.
Global trade environment
Although global trade and geo-political uncertainties persist, they continue to have a negligible material impact on the financial performance of the company. This quarter’s results highlight the consistently high degree at which Lenovo continues to perform. Lenovo’s global footprint, flexible, majority-owned manufacturing base and ongoing strong financial performance remain competitive differentiators propelling the company’s market-leading position. Going forward, Lenovo is well positioned to manage complex and dynamic market conditions, while continuing to deliver sustainable long-term results.
Business Group Overview
The strong results are led by the Intelligent Devices Group (IDG). The PC and Smart Devices Group (PCSD), one of the two IDG business units, reported US$10.7 billion in revenue and record PTI margin of 5.7%. Sales volume in PCs enjoyed strong growth year-on-year of 7.1%, resulting in overall PCSD revenue growth of 4.1% year-on-year. Pre-tax income was US$612 million, up US$97 million year-on-year.
In PCs, volume again outgrew the market, which is continuing to recover. Lenovo holds 24.4% of the global PC market, sustaining its position as the worldwide #1 in PCs. Growth came from high-growth and premium categories, including Workstation, Thin and Light, Visuals and Gaming PCs – all of which had double-digit volume growth year-on-year. In the future the PCSD group will continue to drive premium-to-market growth and industry leading profitability as it continues to focus on customer insights to innovate across the portfolio.
IDG’s second business unit, the Mobile Business Group (MBG), posted its fourth consecutive quarter of profitability and positive PTI, improving US$57 million year-on-year. While there was a small revenue decline reported year-on-year (5.7% to US$1.5 billion), the group continues to focus on inventory controls, portfolio efficiency and diligent cost controls to help expand margins. The company’s Latin America stronghold continues to see revenue, profit and market share grow year-on-year. In North America Lenovo moved up two places in the industry rankings from the previous quarter to number four. In addition, revenue continues to outgrow the market with profit continuing to improve. Going forward, Lenovo will continue its investment in its mobile business to drive ongoing and future growth opportunities in select new and profitable markets.
The Data Center Group (DCG) successfully navigated challenging circumstances during the quarter and reports its 9th consecutive year-on-year quarter of narrowing losses. Overall revenue in DCG declined 13.8% as a result of lower prices for key components and softness in demand from some of the largest hyperscale customers. Revenue – excluding Hyperscale – grew almost 13% year-on-year with China reporting more than a 47% increase in non-hyperscale revenue compared to the same quarter a year ago. In addition, there was strong double-digit growth in Storage, Software Defined Infrastructure and High Performance Computing as a result of an expanded storage portfolio, strong ThinkAgile offerings and new HPC project wins. Looking ahead, the data center group will continue its growth in non-hyperscale including fast-growing segments like SDI and storage, while also investing in new Edge, Telco and AI infrastructure opportunities. The Hyperscale customer base is expected to expand and return to growth in the second half of this fiscal year.
Software and Services heading to US$1 billion business
Software and Services revenue* grew 35% year-on-year, reaching almost US$900 million. Device as a Services (DaaS), premier support service and managed services all grew significantly to contribute to this performance and ongoing diversification of the company’s revenue streams. This business is expected to exceed US$1 billion per quarter very soon.
* invoiced revenue
About Lenovo
Lenovo (HKSE: 992) (ADR: LNVGY) is a US$50 billion Fortune Global 500 company, with 57,000 employees and operating in 180 markets around the world. Focused on a bold vision to deliver smarter technology for all, we are developing world-changing technologies that create a more inclusive, trustworthy and sustainable digital society. By designing, engineering and building the world’s most complete portfolio of smart devices and infrastructure, we are also leading an Intelligent Transformation – to create better experiences and opportunities for millions of customers around the world. To find out more visit https://www.lenovo.com, follow us on LinkedIn, Facebook, Twitter, YouTube, Instagram, Weibo and read about the latest news via our StoryHub.
|
LENOVO GROUP FINANCIAL SUMMARY For the second quarter ended September 30, 2019 (in US$ millions, except per share data) |
||||
|
|
|
|
Q2 18/19 |
|
|
Revenue |
|
13,522 |
13,380 |
1% |
|
Gross profit |
|
2,183 |
1,794 |
22% |
|
Gross profit margin |
|
16.1% |
13.4% |
2.7pts |
|
Operating expenses |
|
(1,741) |
(1,504) |
16% |
|
Expenses-to-revenue ratio |
|
12.9% |
11.2% |
1.7pts |
|
Operating profit |
|
442 |
290 |
53% |
|
Other non-operating expenses - net |
|
(132) |
(77) |
73% |
|
Pre-tax income |
|
310 |
213 |
45% |
|
Taxation |
|
(66) |
(40) |
67% |
|
Profit for the period |
|
244 |
173 |
40% |
|
Non-controlling interests |
|
(42) |
(5) |
716% |
|
Profit attributable to equity holders |
|
202 |
168 |
20% |
|
EPS (US cents) |
|
|
|
|
|
Basic |
1.69 |
1.41 |
0.28 |
|
|
Diluted |
1.62 |
1.40 |
0.22 |
|
To view this piece of content from cts.businesswire.com, please give your consent at the top of this page.
View source version on businesswire.com: https://www.businesswire.com/news/home/20191106006181/en/
Contact information
Hong Kong – Angela Lee,
angelalee@lenovo.com, +852 2516 4810
London – Charlotte West, cwest@lenovo.com, +44 7825 605720
Zeno Group - LenovoWWcorp@zenogroup.com
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
Clene Nanomedicine Partners with Veristat to Reduce Biostatistical Output Time by 80% for ALS New Drug Application12.11.2026 19:09:00 EET | Press release
VeristatTM, a global clinical research organization (CRO) and consultancy specializing in complex studies, announced that it has partnered with Clene Nanomedicine to cut the time to deliver biostatistical outputs for a pivotal ALS drug application submission by 80%. Veristat reduced the time from study data to validated tables, listings and figures (TLFs) from up to six weeks to just one week. Clene, a late-stage biotech company, leveraged Veristat’s recently launched InStat™ platform, the industry’s first zero-code, fully automated solution to accelerate clinical trial processes. Biostatistical TLFs sit on the critical path for submissions, yet most sponsors rely on antiquated processes that involve slow, manual workflows to produce them, making post-database lock one of the biggest bottlenecks to regulatory approval. To remove this barrier, Veristat uses its AI-enhanced platform to compress the timeline to submission-ready TLFs from weeks to days, with every output validated by stati
WHOOP Launches WHOOP Humans, the Most Verifiably Human Social Network12.11.2026 19:00:00 EET | Press release
WHOOP, the human performance brand, today launched WHOOP Humans, a new feature that lets members follow friends and family, share fitness, health, and performance data they choose, and support each other's progress. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20261112176779/en/ WHOOP Launches WHOOP Humans, the Most Verifiably Human Social Network For more than a decade, WHOOP has helped members better understand their own health and performance. Now, WHOOP Humans extends that experience beyond the individual, making it easier to celebrate achievements, encourage progress, and look out for the people who matter most. "In a world that's becoming increasingly artificial, we're building something deeply human,” said Will Ahmed, Founder and CEO of WHOOP. “This is the most verifiably human network ever launched. Every account represents a real person with a verified heartbeat. They have real goals, challenges, and achievements. T
Integrated Hubs for Green Chemistry Research Aim to Transform How Chemicals and Materials Are Designed12.11.2026 18:00:00 EET | Press release
The Gordon and Betty Moore Foundation today announced four Integrated Research Hubs to explore new frontiers in chemical design, from materials that respond to their surroundings to molecules designed for safety from the start. Bringing together global researchers across institutions and disciplines, the hubs will investigate fundamental principles that could enable new capabilities in chemicals and materials while improving performance and protecting human health and the environment. The research priorities emerged through extensive engagement with the scientific community to identify the questions that could transform what chemistry can achieve. Each hub will connect researchers across institutions around one of four green chemistry focus areas: Safer molecular design: Led by The George Washington University, this hub will combine artificial intelligence and quantum chemistry to embed safety into chemical design from the outset. Adaptive catalytic systems: Led by the Max Planck Insti
Roquette Highlights Scalable Excipient and Capsule Solutions for Regional and Global Pharmaceutical Markets at CPHI India 202612.11.2026 17:00:00 EET | Press release
Roquette, a global leader in plant-based ingredients and a leading provider of pharmaceutical excipients, will showcase its comprehensive portfolio of excipient and capsule solutions at CPHI India 2026, Hall 1, Booth 1I12 from November 23 to 25, 2026. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20261112803410/en/ Meet Roquette at CPHI India 2026, Hall 1, Booth 1I12 At the event, Roquette will demonstrate how it helps pharmaceutical manufacturers accelerate the journey from formulation to market with confidence. By combining technical expertise, trusted quality, meaningful innovation and close collaboration, Roquette helps customers address formulation, scale-up and manufacturing challenges across a broad range of pharmaceutical applications. As India continues to play a critical role in supplying medicines to patients around the world, pharmaceutical manufacturers face increasing demands for quality, regulatory compliance,
Tigo Energy and Google Cloud Pair AI-Powered Tools for Solar Installers and Utilities12.11.2026 16:00:00 EET | Press release
Tigo Energy, Inc. (NASDAQ: TYGO) (“Tigo” or “Company”), a leading provider of intelligent solar and energy software solutions, today announced a collaboration with Google Cloud to develop AI-enabled operational workflows for solar installers and distributed energy portfolios. By making core Tigo data and software products available through Google Cloud, Tigo aims to deliver faster deployment, simplified data integration, and additional insights with Gemini. The resulting workflows will help installers, asset managers, and energy operators more easily identify issues, prioritize actions, and automate routine operational tasks across growing fleets of distributed energy systems. As solar and storage portfolios expand, energy businesses are increasingly responsible for managing more sites, more system data, and more customer interactions without a proportional increase in operational resources. Through collaboration with Google Cloud, Tigo is developing AI-assisted workflows to help opera
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