lenovo posted a new revenue and profit record in the third quarter of its fiscal year 2022, which ended on December 31. Thus, between last October and December, its profits rose no less than 62%reaching 640 million dollars, which has been possible according to the company thanks to the popularity of hybrid work as the pandemic ends, which has significantly increased the demand for PCs.
In addition, during this quarter, company revenues up 17% up to 20,100 million dollars, also setting a record for Lenovo as we have mentioned. In addition to breaking both records, the company has exceeded all expectations in terms of results for the reporting period.
The company has stated that the demand for business PCs (Chromebooks apart) has seen a large increase during the quarter. So much so that it has grown to the highest level since 1998. Customers who have purchased computers this quarter have also opted for more high-end models, as well as laptops, due to the increase in remote work.
On the other hand, although the chip shortage, which has affected many sectors of the industry, has been a notable problem for business growth, Lenovo has detected some signs of improvement, as well as adjusting its practices to cope with shortages. All in all, Lenovo managed to achieve a 24.6% market share of PC sales in the world.
Regarding the areas, it must be remembered that, a year ago, Lenovo reorganized its business divisions. The Data Center Group then became part of the Infrastructure Solutions Groupwhich in this quarter has had revenues of 1,900 million dollars with a year-on-year growth of 19% and has had benefits, although scarce: 17 million dollars.
Another of the divisions created a year ago, the Lenovo Services and Solutions Group, which covers all things managed services and IT as a Service, grew 25% year-over-year in revenue to $1.5 billion, posting profit of $340 million. It has become the business area with the highest business margin of the company.
As for the smart device group, which encompasses Lenovo PCs, smartphones and other devices, saw revenue grow 16% to $17.6 billion, with profit up 21% to $1.4 billion. The income obtained from the sale of workstations rose 40%, and those of the equipment designed for gaming have done so by 27%. As for the area of Motorola smartphones, it had 89 million profits.
Yang Yuanqing, President and CEO of Lenovohas highlighted that the company has followed «seizing the opportunities driven by accelerated digital and intelligent transformation, and our new IT architecture has prepared us well, with “client-edge-cloud-network-intelligence” capabilities. With another record quarter, we achieved the sixth quarter of year-over-year net revenue growth of more than 50%, and the first of US$20 billion in revenue in our history. We continue to make progress towards doubling our net margins and R&D investment in three years from FY20/21 levels. Again, we have shown that Lenovo’s innovation, transformation strategy and strong execution can consistently deliver sustainable earnings growth for the future.«.
