Lenovo has announced group revenue in the first quarter reached $12,5-billion, the eighth consecutive quarter of growth.
Pre-tax income more than doubled year-on-year, growing by $127-million to reach $240-million. Net income also more than doubled, up $85-million to $162-million.
Basic earnings per share for the first quarter were 1.37 US cents or 10.74 HK cents.
“This fiscal year kicked off to an excellent start. Once again, this quarter’s strong results provided solid evidence that Lenovo’s Intelligent Transformation is enabling the company to drive sustainable, profitable growth in today’s dynamic and changing world. Our persistent execution and operational efficiency allows us to bring our vision to life and deliver smarter technology for all,” says Yang Yuanqing, Lenovo chairman and CEO.
The first quarter results signal that Lenovo continues outperform the market and is well positioned to manage complex and dynamic market conditions going forward.
The strong results are led by the Intelligent Devices Group (IDG). The PC and Smart Devices Group (PCSD), one of its two business units, continued double-digit (12%) revenue growth while achieving its highest-ever profit in a fiscal first quarter, and further improving industry leading profitability.
Pre-tax income was $524-million, up $98-million. Americas and Asia Pacific achieved 20% and 40% year-on-year revenue growth respectively and all four geographies (Americas, Asia Pacific, China, EMEA) each delivered over $2-billion in revenue, demonstrating the geographical balance and sustainability of this business.
In PCs, volume outgrew the market, which as a whole is experiencing a recovery, by over 13 points, and the group hit an all-time record PC market share of 24,9%.
IDG’s second business unit, the Mobile Business Group (MBG), delivered another profitable quarter and improved pre-tax income by $100-million for the fourth consecutive quarter. In the North America market, volume outgrew the market by more than 37 points and pre-tax income margin improved by over 14 points year-on-year. In the company’s Latin America stronghold, volume has grown with or above the market for 11 quarters.
Going forward, the mobile business will continue to maintain profitability and seek opportunities to drive profitable growth in new markets with new innovative products.
The Data Centre Group (DCG) continued to improve profitability year-on-year for the eighth consecutive quarter. Storage revenue grew more than 80% year-on-year and Software Defined Infrastructure (SDI) continued to grow at a double-digit rate year-on-year.
Overall revenue declined due to a small number of large cloud customers reducing their purchasing after rapid infrastructure growth over the past year and a lower average unit revenue due to declining component prices.
In High Performance Computing, the company extended the number one position in the Top 500 Supercomputer list to 173 systems across 20 markets – continuing to support ground-breaking scientific research and applications around the world.