Sometimes, the true success of a company is based on the diversification of its products. Playing everything on the same card has its advantages, but also its clear drawbacks if the winds do not blow in favor of a certain product or trend. Thus, Lenovo has been clear about this for a long time.
And it is that, the famous brand of PC can boast of being leaving more or less gracefully the stagnation in the sale of these devicesthanks to the fact that more than 40% of the income already comes from other products that have nothing to do with the sale of PCs.
Specifically, the Chinese multinational technology company based in Beijing obtained income in the third quarter of its 2022-2023 financial year of 15.3 billion dollars, which means figures at maximums without taking into account the sale of devices.
The secret? He Record revenue from its Solutions and Services (SSG) and Infrastructure Solutions (ISG) businesses which set revenue records, with 1,800 million and 2,900 million dollars, respectively, with interannual growth of 23% and 48%. Specifically, at ISG, operating profits also doubled with an all-time high of 43 million.
The combination of revenue from non-hardware-focused services and solutions led the company to a record 53%, with managed services nearly doubling year-over-year values.
“Our services-led transformation strategy is paying off (…) our diversified growth drivers in businesses outside of PCs currently account for more than 40% of Group revenue (…) and are driving strong profitability,” says the CEO and Chairman Yuanqing Yang. And all this despite the complex macroeconomic environment, “we have maintained our leadership in the PC market”. In fact, the Intelligent Devices unit (IDG) retains the first position in computers with a share of 23.1%.
Unlike other companies in the sector, Lenovo can boast of having obtained an outstanding profitability for the fifth consecutive quarter. In this last quarter, Lenovo’s net profit reached 437 million dollars.
“We are fully confident that our clear strategy, operational resilience, healthy liquidity, and continued investment in innovation will ensure long-term sustainable growth and improve profitability,” Yang says. That, in addition, foresees that spending on PCs will recover in the medium-long term. “(Demand) is much better than what the sectoral production figures indicate.”
For the second semester, The company is confident of recovering the path of year-on-year growth and receive a demand from end users even greater than that registered in 2019.
Lenovo in Spain and Portugal
Lenovo has recovered in its third quarter of its fiscal year, the leadership of the PC market in Spain and Portugal with a market share of 26.2%.
The general director of Lenovo Iberia, Alberto Ruano, has highlighted that the company has fallen less than the market, which is suffering from the fall in consumption and the shift in customer preferences to the detriment of technology.
The executive stressed that the technology market is cyclical and closely linked to the renewal of products. Predicting a flat calendar year in line with this quarter before the recovery in 2024.
As reported by Europa Press, Ruano has advanced that the company will soon present a new strategy to encourage cross-selling of its solutions and devices.
