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Lenovo cracks its first ever $10bn quarter

PC sales still bring in half the loot as smartmobe sales surge 300 per cent

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Lenovo sold a record-breaking 32.6 million pieces of kit in the last quarter, passing the $US10 billion (£6bn) revenue milestone for the first time.

The PC giant’s third fiscal quarter ending 31 December saw revenue up 15 per cent year-on-year to $10.8bn (£6.5) and profits up even more, growing 30 per cent to $321m (£193m).

The results helped Lenovo stay out in front in the global PC stakes with its highest ever quarterly market share of 18.5 per cent, according to IDC’s latest stats.

The firm said it sold 15.3m PCs, 13.9m smartphones and 3.4m tablets, with smartmobe sales growing 47 per cent year-on-year and tablets at a rapid 300 per cent.

Laptops remained Lenovo’s biggest cash cow for the quarter, contributing an impressive 50 per cent of revenue ($5.4bn, £3.3bn) despite shipments dropping 6.3 per cent year-on-year.

Cock-a-hoop CEO Yang Yuanqing said the record-breaking results were a vindication of the firm’s PC Plus strategy – which has seen it expand out of its core heritage in PCs to smartphones, tablets and the like.

That strategy is likely to get a further boost with the pending acquisitions of Motorola Mobility and IBM’s x86 server business. Although they will cost Lenovo a combined $5.2bn (£3.1bn), the past quarter has shown that the Chinese hardware giant can easily afford it and analyst reaction has generally been positive.

“The Motorola and IBM server acquisitions that we just announced are a perfect fit with our PC Plus strategy,” Yang said in a canned statement.

“While our top priority now is full participation in the regulatory approvals process, I am confident that from day one after closing, these businesses will quickly begin contributing to our performance and develop into pillars for long-term, sustainable growth.”

Lenovo remains China’s best known and most successful brand name in tech – although much to the frustration of Beijing it doesn’t have much competition.

Its revenue from the Middle Kingdom remained a sizeable but little-changed 37 per cent of its global total, but it was elsewhere in APAC (+22 per cent), EMEA (+25 per cent) and the Americas (+36 per cent) where growth really spurted. ®

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