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
Biocytogen Announces Clinical Milestone with First Patient Dosed in Phase 1 Trial of IDEAYA’s First-in-Class B7H3/PTK7 Bispecific TOP1 ADC IDE03428.2.2026 02:00:00 EET | Press release
Biocytogen Pharmaceuticals (Beijing) Co., Ltd. (Biocytogen, SSE: 688796; HKEX: 02315), a global biotechnology company that drives the research and development of novel antibody-based drugs with innovative technologies, today announced that its partner IDEAYA Biosciences, Inc. (“IDEAYA”; Nasdaq: IDYA) has dosed the first patient in IDEAYA’s Phase 1 dose-escalation/expansion clinical trial of IDE034, an investigational B7H3/PTK7 bispecific TOP1 ADC. Pursuant to the companies’ option and license agreement, first patient dosing triggers a $5 million milestone payment to Biocytogen. According to IDEAYA, the Phase 1 study is designed to characterize IDE034’s safety profile, tolerability, and PK as a monotherapy, and IDEAYA also intends to evaluate combination regimens with DNA damage response (DDR) -targeting agents such as its oral PARG inhibitor IDE161 as the program advances. IDE034 is a potential first-in-class bispecific B7H3/PTK7 TOP1 ADC, independently developed by Biocytogen and lice
IQM and Real Asset Acquisition Corp. to Host Conference Call/Webcast to Discuss Proposed Transaction27.2.2026 14:00:00 EET | Press release
IQM Finland Oy, a global leader in full-stack superconducting quantum computers (“IQM”, “IQM Quantum Computers” or the “Company”), and Real Asset Acquisition Corp. (Nasdaq: RAAQ), a special purpose acquisition company (“RAAQ”), announced that they will host a conference call to discuss their recently announced business combination, including certain transaction highlights. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260227472716/en/ IQM Radiance quantum computer As previously disclosed, on February 23, 2026, IQM and RAAQ announced they have entered into a definitive business combination agreement, which will result in IQM becoming a public company and listing American Depositary Shares on one of the two leading U.S. stock exchanges. The transaction provides funding with the aim to accelerate IQM’s technology and commercial development towards fault-tolerance quantum computing, further advancing its position as a leading p
HighRadius Launches $0 Implementation Fee, $0 Subscription Fee via Outcome Based Pricing for oCFO Software27.2.2026 13:00:00 EET | Press release
HighRadius launches Office of the CFO first Outcome Based Pricing with $0 Implementation fee and $0 Subscription until Go-Live. Customers only pay a fraction of realized gains based on P&L impact. Chapter 1: Outcome Based Pricing (OBP) Introduction of OBP: HighRadius, a provider of 190+ AI agents for Order-to-Cash, Accounts Payable, Record-to-Report, and Treasury introduces Outcome Based Pricing (OBP). Three Components of OBP: Customers pay a) $0 in Implementation fees, b) $0 in Subscription fees until Go Live, c) HighRadius earns a fraction of the actual savings realized by the client. Chapter 2: US GAAP & ASC 606 Constraints Not Designed for Innovation: The traditional ASC 606 model requires companies to standardize and recognize revenue based on contractual obligations. For a traditional SaaS subscription, the obligation is access to software over time. AI agents are designed to deliver quantifiable, real-time Business Outcomes that do not fit the traditional accounting framework. C
Kioxia Appoints Yoshihiko Kawamura as Chief Financial Officer27.2.2026 10:15:00 EET | Press release
Kioxia Holdings Corporation (TOKYO:285A), a world leader in memory solutions, today announced the appointment of Yoshihiko Kawamura as Chief Financial Officer (CFO), effective April 1, 2026. Mr. Kawamura brings extensive international experience to Kioxia, having held assignments at Mitsubishi Corporation’s U.S. headquarters, served as General Manager of its Chicago office, and completed a tenure at the World Bank. At Hitachi, Ltd., he held senior leadership positions, including Chief Strategy Officer (CSO), Chief Financial Officer (CFO), and Chief Risk Management Officer (CRMO), where he was instrumental in leading the company’s management reforms. Since joining Kioxia as Executive Vice President in June 2025, Mr. Kawamura has worked closely with the executive team to advance the business through strategic capital and financial planning. Following its initial public offering on the Prime Market of the Tokyo Stock Exchange in December 2024, Kioxia is entering a new phase of growth char
DNP Invests in Rapidus to Support the Establishment of Mass Production for Next-Generation Semiconductors27.2.2026 09:18:00 EET | Press release
Dai Nippon Printing Co., Ltd. (DNP, TOKYO:7912) today announced that it has participated in Rapidus Corporation’s funding round as one of the round investors. This strategic funding initiative supports Rapidus’ plan to steadily progress from its current R&D phase to mass production of 2nm (10⁻⁹ meters) logic semiconductors by 2027. Through this initiative, DNP will advance the development and mass production of EUV lithography photomasks and support Rapidus as it establishes a mass production system for 2nm & next-generation semiconductors. Background In recent years, the rise in energy consumption, in line with increased data generation, has become a challenge, driving demand for next-generation semiconductors capable of improving device performance and reducing power consumption. Next-generation semiconductors manufactured using EUV lithography enable the formation of finer patterns on silicon wafers compared to currently available technologies. This in turn is boosting expectations
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