Lenovo bullish after stellar Q1

Gains all around for Chinese titan

Lenovo's share of the UK and Ireland PC market increased to almost 12 per cent during a stellar first fiscal quarter.

For the three months to the end of June, the Chinese firm grew sales 10 per cent annually to $8.8bn (£5.6bn). Pre-tax profit jumped 16 per cent to $215m, with gross profit of $1.2bn equating to gross margins of 13.6 per cent.

The vendor saw its laptop sales grow 4.7 per cent on the prior year to $4.5bn, comprising 52 per cent of its total top line. Desktop shipments were flat year on year but revenue from this segment dropped 2.8 per cent to $2.5bn, accounting for 28 per cent of overall sales. Sales of mobile devices, including tablets and smartphones, more than doubled to $1.2bn, equating to 14 per cent of quarterly turnover.

During the quarter Lenovo definitely reclaimed the crown as the world's biggest PC vendor, with both Gartner and IDC agreeing that the Chinese giant was ahead of US rival HP during the period.

Lenovo claimed today that it is now the world's fourth-largest smartphone manufacturer, having grown from nothing in the past two years to snaffle 4.8 per cent of the global market. The vendor also asserts that it is number five in the tablet marketing rankings with a 3.3 per cent slice of the pie.

The Q1 results presentation also states that Lenovo accounted for 11.7 per cent of the UK and Ireland PC market during the quarter, an increase of 3.4 points on the corresponding period last year.

Chief executive Yang Yuanqing said: "In a tough PC market, Lenovo became the clear number one for the first time and continues to improve profitability. Our strong performance in PC is fuelled by balanced growth, through our consistent execution of the right strategy.

"While driving profitable growth in our core PC business, we are rapidly transforming our company into a ‘PC Plus' company. The PC Plus market requires fast, efficient innovation as it moves quickly from premium products to mainstream ones and from mature market domination to emerging market hyper-growth.

"This kind of market plays to Lenovo's proven strengths. Lenovo is now better positioned than our competition to take advantage of these clear trends."