What downturn? Lenovo stuffs pockets with 54% extra profit

Lenovo Group is one of the few PC makers still in the pink, beating market expectations with a fat third-quarter net profit.

The Chinese firm's profit jumped 54 per cent to $153.46m in the three months to December last year, up from $99.65m in the same period the year before.

Despite the downturn in the global economy and the lack of consumer appetite for PCs and laptops, Lenovo is continuing to do well. The main driver of the PC maker's growth is its market share in China and emerging markets, which has allowed it to continue expanding.

In July last year, Lenovo launched a joint venture with Japan's NEC to control that firm's and its own PC businesses in Japan. The same month, it started a takeover of German consumer electronics company Medion.

The firm is now the number two PC maker in the world, having passed Dell to take the slot behind HP.

"Commercial demand and growth in emerging markets including China continued to help offsetting the weaknesses in mature markets triggered by pressure on the consumer business," Lenovo said in its filing. "The group’s continuous solid execution has enabled it to be the fastest growing PC company among the top four global PC companies for nine consecutive quarters, and outperform the global PC market for eleven consecutive quarters."

But Lenovo is not ignoring the new major growth sectors in technology either, venturing into both smartphones and tablets.

"The sales of the Mobile Internet and Digital Home business, which was largely from mobile phone sales in China, increased by 159 per cent year-on-year to $565 million," the group said.

The Chinese firm said it "remains optimistic" that growth will continue and since it's going to have lots of money, it also said it would be on the lookout for other acquisitions.

"The group, given its strong financial position, will continue to actively look for inorganic growth opportunities which will supplement its organic growth strategy to accelerate future expansion," Lenovo said. ®