PC giant posts surprise first-quarter profit of US$67m
Lenovo Group, the world's third-largest personal computer supplier, will sharpen its focus on the international consumer market next year, emboldened by a fiscal first-quarter net profit that grew a better than expected 12-fold thanks to robust sales to small businesses.
Marking the company's first double-digit sales growth since it bought IBM's personal computer business two years ago, net revenue for the company rose 1,184 per cent in the three months to June to US$67 million from US$5 million a year earlier. Turnover reached US$3.92 billion, up 13 per cent.
The company was expected to post net income of US$20.4 million, according to the median estimate in a Bloomberg survey.
William Amelio, president and chief executive at Lenovo, attributed the company's strong quarterly performance to robust sales growth worldwide, as the company bolstered marketing to small businesses.
Lenovo seized an 8.3 per cent market share in the quarter, shipping 4.87 million PC units, up 22.3 per cent from a year earlier, to regain its standing as the world's No3 from Taiwanese rival Acer, according to preliminary estimates from market researcher International Data Corp.
Mr Amelio also credited 'the steps we have taken for enhanced operational efficiency and expense control', which included plans to cut or redeploy about 5 per cent of Lenovo's global workforce, announced in April. The company took a US$45 million restructuring charge in the quarter, but estimated the amount would be smaller in the three months to September.