Lenovo Carves Out 30% Profit Increase From PC Market

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Chinese personal-computer giant Lenovo who is currently in talks with Australian retailers about a full product return to the consumer PC market has reported a 30% increase in profits.

The Company who has had two failed attempts to build their presence in the Australian consumer market in the past is currently in talks with JB Hi Fi.

Earlier today the Company reported that their fiscal third-quarter net profit rise 30% from a year earlier thanks to strong sales of PCs and smartphones.

Earlier this month Lenovo acquired Motorola Mobility from Google for US$2.9 Billion with the Company tipped to launch several Motorola products including smartphones and tablets later this year. 

Analysts have warned that this deal may hurt Lenovo’s balance sheet over the next few years.

Motorola’s net loss widened to $928 million last year from $616 million in 2012, according to Lenovo.

The Chinese Company who overtook the struggling Hewlett-Packard as the world’s biggest PC maker by shipment volume, said on Thursday net profit rose to $265.3 million from $204.9 million a year earlier, while revenue rose 15% to $10.79 billion from $9.36 billion. 

Lenovo’s result comes at a time when Sony and Samsung move to quit the PC market in Australia due in part to PC vendors being unable to cope with weak demand for desktop and laptop PCs.

The Wall Street Journal said that In the past few years, Lenovo has demonstrated an ability to increase revenue and squeeze out profits even as most PC makers saw their sales decline.

The company, which became known internationally when it bought IBM’s PC business in 2005, has been trying to make up for the PC market’s expected slowdown by selling more smartphone and tablets in China and other emerging markets. Last year, Lenovo was the world’s fifth-largest smartphone vendor with a 4.5% market share by shipment volume, according to research firm IDC.
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