Lenovo Group has announced record results for the Group for both its fourth quarter and fiscal year, with phenomenal growth across all parts of the business.
The results demonstrate the group’s resilience and ability to achieve balanced, consistent, and sustainable growth as it continues to diversify and transform in line with its 3S (Smart IoT, Smart Infrastructure, Smart Solutions) corporate strategy.
Fourth quarter Group revenue grew at 48% year-to-year to US$15.6 billion. Profit recorded its highest growth rate in two years – with pre-tax income of US$380 million and net income of US$260 million – up 392% and 512% respectively. The Q4 results closed out a record year, with annual Group revenue surging past US$60 billion, adding more than US$10 billion on the previous fiscal year.
Profit grew even faster, with pre-tax income of almost US$1.8 billion and net income of US$1.2 billion – both up more than 70% year-on-year.
Lenovo’s Board of Directors declared a final dividend of 3.09 US cents or 24 HK cents per share for the fiscal year ended March 31, 2021.
“Last quarter, we delivered our fastest growing quarter in almost a decade and closed the fiscal year with the new milestone of passing US$60 billion in revenue and significant growth in profit to a new record. These historic highs were achieved by leveraging our core competencies of a clear strategy, innovative products, operational excellence, and global-local model to meet the new needs in the New Normal,” says Yuanqing Yang, Lenovo chairman and CEO.
“Looking forward, we will capture the huge growth opportunities created by the market trends of information consumption upgrade, infrastructure upgrade and application upgrade to drive long-term sustainable growth and ensure we can build an even smarter future in the years ahead.”
Commenting on Lenovo’s robust quarterly performance, Thibault Dousson, country GM at Lenovo South Africa shares some insights into the company’s strong local statistics: “We are ecstatic to share that Lenovo South Africa has once again claimed the number one market share in South Africa.
“This is the third consecutive quarter that we have dominated the South African PC market, and are delighted to share that we have jumped a whopping 8% from our previous quarterly results, now claiming a total market share of 28.5%.
“As a company, these results indicate that we are going from strength-to-strength, as we continue to live up to our brand promise of providing smarter technology for all, by unveiling the very best innovations in technology for our customers to empower their businesses, professions and personal lives.
“We must also acknowledge and extend our gratitude to our channel partners and teams throughout the country, as our successes would not be possible without their support and the excellent service they provide.”
The fourth quarter record was driven by simultaneous double-digit revenue growth across all core businesses:
* Best fourth quarter ever for PC and Smart Devices (PCSD) with US$12.4 billion in revenue, up 46% year-on-year and profitability at an all-time high of 6.7%.
* All geographies realized high double-digit growth in PCSD revenue and PC volume outgrew the market – further strengthening the company’s global #1 ranking in PCs.
* Tablets had a breakthrough quarter, with shipments growing 157% year-on-year – around three times as fast as the market.
* High growth and premium segment volumes (Gaming, Thin & Light, Chromebooks, Visuals) continue to outgrow the market and deliver strong double to triple-digit growth rates.
* Revenue from the Mobile Business Group (MBG) achieved hyper-growth, up 86% year-on-year to US$1.54 billion – achieving pre-tax income of US$21 million – a record high since the Motorola acquisition.
* Expanded carrier relationships and a strong product portfolio, including 5G products, saw smartphone volumes grow at triple digit rate in North America, Europe, and Asia Pacific.
* Smartphone market share in our Latin America stronghold reached a record of nearly 21%.
* Revenue for the Data Center Group (DCG) was strong, growing 32% year-on-year to US$1.6 billion, the fifth straight quarter of premium-to-market growth. Profitability improved 4.4 points year-on-year.
* The Cloud Service Provider business grew 73% year-on-year and at a 61-point premium to the market.
* Record high fourth quarter revenue was achieved for Server, Storage, Software Defined Infrastructure, Software, and HPC/AI. Traditional storage was a particular highlight growing at 73% year-on-year.
* Burgeoning Edge business delivering strong signs of future growth.
* Transformation businesses also achieved record growth, fueled by ongoing strong growth in services and software revenue up 44% year-on-year. Managed Services revenue (DaaS, TruScale) nearly doubled, and Solutions revenue grew 65% year-on-year.
The fiscal year milestone was fueled by leveraging core competencies of clear strategy, product innovation, operational excellence, and global/local model:
* For the first time, Group revenue surged past US$60 billion, adding more than US$10 billion, or 20% year-on-year growth in just one year.
* Intelligent Devices Group (PCSD and MBG) and Data Center Group achieved revenue growth of 20% and 15% respectively.
* The Group’s Service-led transformation is forging ahead. Software and Services revenue grew twice as fast at the overall Group revenue, at almost 40% year-on-year to a record US$4.9 billion – now makes up 8%* of Group revenue.