Lenovo poised to claim the pc crown

PUBLISHED : Friday, 14 October, 2011, 12:00am
UPDATED : Friday, 14 October, 2011, 12:00am


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Lenovo Group, boosted by key acquisitions, is gearing up to unseat troubled Hewlett-Packard as the global leader in personal computers, chief executive Yang Yuanqing declared yesterday.

The mainland technology giant took a big step towards that goal in the third quarter when it posted the industry's strongest growth in unit shipments to pass Dell and become the world's second-largest supplier of personal computers with a 13.7 per cent global market share, according to separate preliminary estimates by market research firms Gartner and International Data Corp (IDC).

'This is the highest rank Lenovo has achieved in worldwide PC sales,' Yang said. 'Given the current competitive environment, it positions the company as a strong challenger to ultimately become the global market leader.'

Amid that positive news, Hong Kong-listed Lenovo's share price rose 2.28 per cent to close at HK$5.39 yesterday.

The company's personal computer shipments in the quarter to September jumped 36.1 per cent to 12.58 million units, up from 9.24 million units a year earlier, on 'strong gains across all regions as it continued its channel expansion and capitalised on disarray among the other top players', IDC's Worldwide Quarterly PC Tracker report said.

That marked the ninth consecutive quarter in which Lenovo has outpaced the global personal computer market by more than 10 per cent. It has outperformed the market by 20 per cent or more in six of those quarters.

The company recently spent an estimated Euro466 million (HK$4.97 billion) on acquiring the German consumer electronics company Medion to expand its operations in western Europe.

In July, Lenovo and NEC launched a joint venture in Japan that became the country's biggest personal computer supplier. NEC Lenovo Japan Group, in which the mainland firm has a 51 per cent stake and invested US$175 million, accounts for about 25 per cent of annual personal computer sales in Japan, the industry's third-largest market.

Gartner principal analyst Mikako Kitagawa said Lenovo's 'aggressive marketing to both the professional and consumer PC markets accelerated its shipment volume' in the last quarter.

Lenovo, which acquired IBM's personal computer division for US$1.75 billion in 2005, apparently benefited from the general improvement in demand across Asia, where it is the largest computer company. Gartner calculated total personal computer shipments in the region, excluding Japan, advanced 6 per cent to reach 31.8 million units last quarter.

'The region managed to regain momentum, reversing two previous quarters of only single-digit growth, due to gains in China and India, as well as good volume in Indonesia and Thailand,' the IDC report said.

IDC estimated worldwide personal computer shipments grew 3.6 per cent to 91.879 million units last quarter from 88.679 million units the previous year. Gartner calculated a 3.2 per cent year-on-year increase to 91.786 million units.

Despite announcing plans in August to spin off or sell its personal computer business as part of a corporate makeover, HP remained the market leader with an 18.1 per cent market share last quarter on the back of double-digit growth in the United States, according to IDC.

Gartner's Kitagawa said HP's efforts to give the appearance of 'business as usual' seemed to work in the quarter, although its sales outside the US were relatively weak.