Click here to close now.




















Welcome!

@CloudExpo Authors: Elizabeth White, Pat Romanski, Esmeralda Swartz, Liz McMillan, Nicholas Lee

News Feed Item

Lenovo Reports Second Quarter 2012/13 Results

Lenovo Group today reported results for its second fiscal quarter ended September 30, 2012. Outgrowing the market in all geographies, Lenovo continued its push towards becoming the number one vendor in the PC industry, with record quarterly sales of $8.7 billion, an 11 percent increase year-over-year. While growing faster than the top four PC companies for three straight years, Lenovo also turned in another quarter of record pre-tax income at US$204 million, evidence that the Company continues to build upon its track record of profitable growth.

During the second fiscal quarter, Lenovo’s worldwide PC shipments grew 10.3 percent, in a difficult market that was down eight percent year-over-year, the 14th quarter in a row that the company has grown faster than the PC industry as a whole. In this challenging environment, Lenovo achieved its highest-ever worldwide market share of 15.6 percent*, gaining share points in every geography, every product category in which it competes, and in every respective customer segment.

This balanced growth has become a hallmark of Lenovo over the past three years, and is the result of the Company’s continued focus on its “protect and attack” strategy, whereby Lenovo strengthens its position in those places or markets where it enjoys a solid business, while simultaneously reaching outwards into new places or markets where opportunities to reach even more customers present themselves. Entering these new markets is essential to Lenovo continuing its position as a leader in the PC Plus era, where tablets, smartphones and smart TVs continue to gain traction and capture record customer acceptance.

In addition to its impressive share gains, Lenovo turned in net income of US$162 million in the second quarter, an increase of 13 percent year-over-year, with gross margin at 12.1 percent. Gross profit for the second fiscal quarter increased 11 percent year-over-year, to US$1.1 billion, while operating profit for the second quarter was US$206 million, a 24 percent increase year-over-year.

Basic earnings per share for the second fiscal quarter was 1.58 US cents, or 12.25 HK cents. Net cash reserves as of September 30, 2012, totaled US$3.6 billion. Lenovo’s Board of Directors declared an interim dividend of 4.5 HK cents per share.

As the PC Plus era continues to take shape, Lenovo made several bold moves during the second fiscal quarter to solidify its leadership position, announcing two significant acquisitions: CCE, widely known in Brazil as a leader in PCs and consumer electronics, which significantly expands Lenovo’s presence in the world’s third-largest PC market, including manufacturing capabilities; and Stoneware, a software company based in Indiana, focused on cloud computing, which will help Lenovo grow its capabilities for both commercial and consumer cloud offerings, particularly the ability to provide secure content across multiple devices in education and government sectors.

Both of these acquisitions came quickly on the heels of Lenovo’s announcement of a global partnership with EMC, forming a server technology development program to help drive innovation and extend Lenovo’s capabilities in x86 industry-standard servers. As part of this agreement, Lenovo will bring these servers to market on its own, and embed them in selected EMC storage systems over time. Just last week, Lenovo announced the formation of the Enterprise Product Group, a new business unit that will focus on expanding the Company’s server, storage, networking and software offerings geared to a variety of commercial customers, including large enterprises, small/medium businesses and system integrators.

Also during the second quarter, Lenovo announced that it was opening a manufacturing line in North Carolina, creating 115 new manufacturing jobs, boosting its competitive position as a global company with strong local roots.

“With the strong execution of our Protect and Attack strategy, Lenovo has continued its strong and balanced growth momentum. Our global PC market share reached another historic high, moving us closer to our dream of becoming the worldwide PC leader. With four years’ effort, our Consumer PC business has become the world’s number one in this segment for the first time. Our smartphone business in China, which we started only two years ago, has again strengthened its number two position,” said Yang Yuanqing, Chairman and CEO of Lenovo. “More importantly, we not only grew rapidly, but also improved our profitability consistently, with pre-tax income reaching a record high this quarter. As emerging markets outside of China and Mature Transactional business have entered the profitable growth stage, and as our smartphone and other MIDH (mobile internet/digital home) business continue to grow, Lenovo’s overall profitability will continue to improve.”

GEOGRAPHIC OVERVIEW

  • Lenovo China achieved US$3.9 billion in consolidated sales in the second fiscal quarter, an increase of 20 percent year-over-year, accounting for 44 percent of the Company’s worldwide sales. During the second quarter, Lenovo grew its number-one position in China, the world’s largest PC market, to a leading market share of 34 percent, up 2.4 points year-over-year. Lenovo’s PC shipments in China grew eight percent year-over-year in the quarter, a significant result given that the overall China PC market was flat. As the number one PC vendor in China, Lenovo’s PC shipments are greater than that of the next top four vendors combined. Of particular note, is Lenovo’s continued strength in China’s emerging cities, and the Company continues to build its reputation with other product offerings such as smart phones, tablets and smart TVs, as it leads China’s customers into the PC Plus era.
  • In the Asia Pacific/Latin America region, Lenovo achieved a record market share of 11.5 percent in the second fiscal quarter, up 1.6 points year-over-year. In a PC market that was down ten percent year-over-year, the Company grew its PC shipments across the region by an impressive five percent. Lenovo was the leading PC vendor in Japan, the world’s fifth largest PC market, and number one in India as well, where the Company grew 31.8 percent and gained 4.8 share points year-over-year. In the Latin America countries (not including Brazil), Lenovo recorded its first-ever overall double-digit market share, while picking up 4.1 share points year-over-year. Consolidated sales across the region totaled US$1.8 billion for 21 percent of Lenovo’s worldwide sales.
  • For the first-time ever, Lenovo in Europe Middle East/Africa achieved double-digit market share, ending the second fiscal quarter at 10.8 percent, an increase of 3.0 share points year-over-year. These gains helped Lenovo become the third-largest PC vendor in EMEA. Lenovo’s share gains were consistent throughout the region, growing in all markets. Among the highlights for the second quarter were the Company’s number one positions in Russia and Germany, where in the latter Lenovo gained 3.9 additional share points year-over-year. Although the overall industry was down eight percent across the region, Lenovo grew its PC shipments by 27 percent year-over-year, a stunning result. The Company had consolidated sales in the second quarter of US$1.8 billion, a year-over-year improvement of 12 percent, and good for 21 percent of Lenovo’s total worldwide sales.
  • Lenovo’s PC shipments in North America in the second fiscal quarter increased eight percent year-over-year, in a market that fell badly by about 12 percent. In this environment, the Company picked up 1.6 share points to a record high market share in the U.S.A. of 8.3 percent. Consolidated sales grew seven percent year-over-year to US$1.2 billion in the second quarter, or 14 percent of Lenovo’s total worldwide sales. Triggered by a ten-times increase in its retail presence throughout the U.S.A, Lenovo saw significant sales gains in its consumer business there. Commercial account growth was strong there as well.

PRODUCT OVERVIEW

  • For the first-time ever, Lenovo became the world’s largest supplier of Laptop PCs. The Company’s laptop shipments worldwide in the quarter were up 11.3 percent year-over-year, helping Lenovo gain 2.6 share points and achieve a record-high laptop market share of 16 percent. Across the industry, laptop shipments were down seven percent year-over-year. Lenovo’s laptop computers continued to be the largest contributor to the Company’s sales worldwide, generating 53 percent of Lenovo’s total sales revenue. Consolidated sales for Lenovo’s laptop PC business worldwide in the second fiscal quarter totaled US$4.6 billion, an increase of three percent year-over-year. During the second quarter, Lenovo announced a breathtaking array of new products: ThinkPad X1 Carbon, ThinkPad T430u ultrabook, and ThinkPad Tablet 2, the company’s first tablet specifically geared for Windows 8. Last month, Lenovo caught the industry’s attention with its announcement of three new convertibles, Yoga 13, Lynx and Twist, tablets that flip, twist, fold and separate, and are designed for Windows 8.
  • Consolidated sales of Lenovo Desktop PCs worldwide increased five percent year-over-year in the second fiscal quarter to US$2.8 billion, or 32 percent of Lenovo’s total sales revenue. The Company’s desktop PC shipments worldwide in the second quarter increased 8.8 percent year-over-year worldwide, compared to an overall industry decrease of nine percent worldwide. As a result, Lenovo gained 2.6 share points year-over-year and achieved a record-high market share of 15 percent. During the second quarter, Lenovo announced its new IdeaCentre A520, a new all-in-one desktop PC featuring a compact 23-inch frameless 1080p display that supports multi-touch with a widely adjustable screen angle (from -5 to 90 degress flat) with perfect picture at any angle so users can watch movies, play touch-based games or enjoy video chat in any position.
  • Entering its second full year of operations, Lenovo’s Mobile Internet Digital Home (MIDH) group is forging ahead in leaps and bounds, with consolidated sales of US$718 million, a 155 percent increase year-over-year in the second fiscal quarter, and eight percent of the Company’s overall sales. With smartphones and tablets leading the Company’s PC Plus charge, Lenovo has continued to outpace the hyper-growth in shipments in China, and is now the second largest vendor in China in each of these product categories. Lenovo has gained an incredible 12.5 share points in smartphones year-over-year in the second quarter for an overall market share of 14.2 percent in China. During the second quarter, Lenovo announced that it would begin selling smartphones in Indonesia, Philippines and Vietnam, and just last week, added India to the list.

ABOUT LENOVO

Lenovo (HKSE: 992) (ADR: LNVGY) is a US$30 billion personal technology company – and one of the top two PC makers in the world -- serving customers in more than 160 countries. Dedicated to building exceptionally engineered PCs and mobile internet devices, Lenovo’s business is built on product innovation, a highly-efficient global supply chain and strong strategic execution. Formed by Lenovo Group’s acquisition of the former IBM Personal Computing Division, the company develops, manufactures and markets reliable, high-quality, secure and easy-to-use technology products and services. Its product lines include legendary Think-branded commercial PCs and Idea-branded consumer PCs, as well as servers, workstations, and a family of mobile internet devices, including tablets and smart phones. Lenovo, a global Fortune 500 company, has major research centers in Yamato, Japan; Beijing, Shanghai and Shenzhen, China; and Raleigh, North Carolina. For more information see www.lenovo.com.

*See IDC data, 3Q 2012

FINANCIAL SUMMARY

       

For the second quarter ended September 30, 2012

(in US$ millions, except per share data)

 
 
Q2
12/13
 
Q2
11/12
 
Y/Y
CHG
Sales 8,672   7,786   11%
Gross Profit 1,050   947   11%
Gross Profit Margin 12.1%   12.2%   -0.1pts
Operating Expenses (844)   (781)   8%
Expenses-to-Revenue Ratio 9.7%   10.0%   -0.3pts
Operating Profit 206   166   24%
Other Non-Operating Expenses (2)   (1)   47%
Pre-tax Income 204   165   24%
Taxation (41)   (20)   103%
Profit for the period 163   145   13%
Non-controlling interests (1)   (1)   12%
Profit attributable to Equity Holders 162   144   13%
EPS (US cents)          
Basic 1.58   1.41   0.17
Diluted 1.55   1.38   0.17

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@CloudExpo Stories
U.S. companies are desperately trying to recruit and hire skilled software engineers and developers, but there is simply not enough quality talent to go around. Tiempo Development is a nearshore software development company. Our headquarters are in AZ, but we are a pioneer and leader in outsourcing to Mexico, based on our three software development centers there. We have a proven process and we are experts at providing our customers with powerful solutions. We transform ideas into reality.
In their Live Hack” presentation at 17th Cloud Expo, Stephen Coty and Paul Fletcher, Chief Security Evangelists at Alert Logic, will provide the audience with a chance to see a live demonstration of the common tools cyber attackers use to attack cloud and traditional IT systems. This “Live Hack” uses open source attack tools that are free and available for download by anybody. Attendees will learn where to find and how to operate these tools for the purpose of testing their own IT infrastructu...
Any Ops team trying to support a company in today’s cloud-connected world knows that a new way of thinking is required – one just as dramatic than the shift from Ops to DevOps. The diversity of modern operations requires teams to focus their impact on breadth vs. depth. In his session at DevOps Summit, Adam Serediuk, Director of Operations at xMatters, Inc., will discuss the strategic requirements of evolving from Ops to DevOps, and why modern Operations has begun leveraging the “NoOps” approa...
SYS-CON Events announced today that IceWarp will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IceWarp, the leader of cloud and on-premise messaging, delivers secured email, chat, documents, conferencing and collaboration to today's mobile workforce, all in one unified interface
The Internet of Things (IoT) is about the digitization of physical assets including sensors, devices, machines, gateways, and the network. It creates possibilities for significant value creation and new revenue generating business models via data democratization and ubiquitous analytics across IoT networks. The explosion of data in all forms in IoT requires a more robust and broader lens in order to enable smarter timely actions and better outcomes. Business operations become the key driver of I...
Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is designed for their business. In 2015, organizations such as United Airlines, Sony...
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and a...
As more and more data is generated from a variety of connected devices, the need to get insights from this data and predict future behavior and trends is increasingly essential for businesses. Real-time stream processing is needed in a variety of different industries such as Manufacturing, Oil and Gas, Automobile, Finance, Online Retail, Smart Grids, and Healthcare. Azure Stream Analytics is a fully managed distributed stream computation service that provides low latency, scalable processing of ...
In today's digital world, change is the one constant. Disruptive innovations like cloud, mobility, social media, and the Internet of Things have reshaped the market and set new standards in customer expectations. To remain competitive, businesses must tap the potential of emerging technologies and markets through the rapid release of new products and services. However, the rigid and siloed structures of traditional IT platforms and processes are slowing them down – resulting in lengthy delivery ...
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
SYS-CON Events announced today that G2G3 will exhibit at SYS-CON's @DevOpsSummit Silicon Valley, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Based on a collective appreciation for user experience, design, and technology, G2G3 is uniquely qualified and motivated to redefine how organizations and people engage in an increasingly digital world.
SYS-CON Events announced today that DataClear Inc. will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The DataClear ‘BlackBox’ is the only solution that moves your PC, browsing and data out of the United States and away from prying (and spying) eyes. Its solution automatically builds you a clean, on-demand, virus free, new virtual cloud based PC outside of the United States, and wipes it clean...
SYS-CON Events announced today that Micron Technology, Inc., a global leader in advanced semiconductor systems, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Micron’s broad portfolio of high-performance memory technologies – including DRAM, NAND and NOR Flash – is the basis for solid state drives, modules, multichip packages and other system solutions. Backed by more than 35 years of tech...
Culture is the most important ingredient of DevOps. The challenge for most organizations is defining and communicating a vision of beneficial DevOps culture for their organizations, and then facilitating the changes needed to achieve that. Often this comes down to an ability to provide true leadership. As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership ab...
Through WebRTC, audio and video communications are being embedded more easily than ever into applications, helping carriers, enterprises and independent software vendors deliver greater functionality to their end users. With today’s business world increasingly focused on outcomes, users’ growing calls for ease of use, and businesses craving smarter, tighter integration, what’s the next step in delivering a richer, more immersive experience? That richer, more fully integrated experience comes ab...
IBM’s Blue Box Cloud, powered by OpenStack, is now available in any of IBM’s globally integrated cloud data centers running SoftLayer infrastructure. Less than 90 days after its acquisition of Blue Box, IBM has integrated its Blue Box Cloud Dedicated private-cloud-as-a-service into its broader portfolio of OpenStack® based solutions. The announcement, made today at the OpenStack Silicon Valley event, further highlights IBM’s continued support to deliver OpenStack solutions across all cloud depl...
Red Hat is investing in Tesora, the number one contributor to OpenStack Trove Database as a Service (DBaaS) also ranked among the top 20 companies contributing to OpenStack overall. Tesora, the company bringing OpenStack Trove Database as a Service (DBaaS) to the enterprise, has announced that Red Hat and others have invested in the company as a part of Tesora's latest funding round. The funding agreement expands on the ongoing collaboration between Tesora and Red Hat, which dates back to Febr...
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies leverage disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advance...
Akana has announced the availability of the new Akana Healthcare Solution. The API-driven solution helps healthcare organizations accelerate their transition to being secure, digitally interoperable businesses. It leverages the Health Level Seven International Fast Healthcare Interoperability Resources (HL7 FHIR) standard to enable broader business use of medical data. Akana developed the Healthcare Solution in response to healthcare businesses that want to increase electronic, multi-device acce...
SmartBear Software has updated its API tools, ServiceV for API service virtualization and LoadUI NG for API load testing, to accelerate development and testing processes in Agile teams. Updates to ServiceV enable software teams to rapidly build advanced mocks from real-time API traffic and quickly switch between virtualized “mock” services and actual APIs during diagnostic, load or integration testing in the continuous delivery lifecycle.