Lenovo back on track in Q3

Back in the black: Lenovo banked $94m in pre-tax profit last quarter

PC vendor Lenovo returned to growth during its third fiscal quarter, with sales and profit enjoying a healthy boost.

Worldwide revenue for the three months to the end of December rose 33 per cent year on year to $4.8bn (£3bn). The vendor posted an annual sales fall in each of the four preceding quarters. Pre-tax profit stood at $94m in Q3, compared to a pre-tax loss of $90m in the corresponding period last year.

Lenovo PC shipments rose 42 per cent year on year in Q3 and the Chinese firm claims to now have nine per cent of the global market – its highest ever share. The vendor also stressed that it grew shipments at almost two and a half times the market rate.

Lenovo's sales in China rose 45 per cent in Q3 to $2.3bn, 47 per cent of the global total. The vendor also claims to have grown its market share in the country to 33.5 per cent, a 2.8 point hike from the preceding quarter.

The vendor's Emerging Markets wing was its fastest growing unit, with turnover up 53 per cent year on year to $857m, 18 per cent of the worldwide figure. Sales in mature markets, which includes western Europe, rose 13 per cent to $1.7bn, 35 per cent of overall revenue.

Lenovo chairman Liu Chuanzhi claimed the board was "especially satisfied" with the company's Q3 performance. "The Lenovo management is forward-looking and strong in strategic planning," he added. "It has already started to deploy a development strategy that integrates innovation into business model, technology and management."

Lenovo's notebook sales rose 46 per cent annually in Q3 to $3bn, 62 per cent of total turnover. Desktop sales spiked 18 per cent to $£1.7bn, 36 per cent of the worldwide figure.

During Q3, Lenovo muscled into the mobile device space with a $200m stock and cash deal to acquire Lenovo Mobile Communication Technology from private equity house Hony Capital. Lenovo chief executive Yang Yuanqing indicated that his firm would attack the market with gusto in the coming months.

"In the future, while we continue to expand our PC business, we also want to attack the mobile internet category to drive growth and capitalise our innovation efforts," he said.