Lenovo Group who is now being selective over what information tech journalists in Australia get access to, has reported an 11% surge in revenues and a 65% lift in profits, with the Chinese PC powerhouse, moving to further invest in Formula 1 to promote the Company and their latest AI offering.
Lenovo leads the market for global PC shipments in the second quarter of 2024, followed by HP and Dell Technologies according to the International Data Corporation, or IDC.
The Chinese Companies PC shipments grew 3.7% year-over-year to 14.7M units and held a market share of 22.7% for the second quarter of 2024.
The growth came as the traditional PC market delivered its second quarter of growth after seeing seven consecutive quarters of decline.
Total worldwide shipments rose 3% year-over-year to 64.9M units in the second quarter of 2024.
IDC noted that while the overall market benefited from favourable comparisons to 2023, weak results in China continued to hold the market back. Excluding China, worldwide shipments grew more than 5% year over year.
Matt Codrington, Vice President and Regional General Manager for Lenovo Asia Pacific, has reported that revenue from non-PC businesses rose from 41% to 47%, reflecting a diversification of the company’s revenue streams.
In the Asia Pacific region, Lenovo experienced a 20% increase in revenue, with non-PC business revenue climbing by 9.4 pp to 43.7%.
Codrington, who is Sydney, based, claims the PC sector, is expecting to see AI PCs comprise 50% of all PCs by 2027.
Lenovo who also own Motorola, is not only focusing on AI PCs but is also expanding AI applications in smartphones, embodying the concept of “from pocket to cloud.”
Lenovo is not only focusing on AI PCs but is also expanding AI applications in smartphones, embodying the concept of “from pocket to cloud.
Codrington attributes these results to the company’s substantial increase in R&D investment and its proactive approach to seizing AI opportunities.
The business that has been investing in Formula 1 marketing since 2022 believes further investments will allow the Company to demonstrate their AI capability by demonstrating its use in Formula 1 motorsport.
The Company believes that the investment not only represents a convergence of racing and technology but also highlights the increasing demand for AI applications, which are becoming more rigorous and wide-ranging.
Codrington confirmed this week that the business has experienced significant growth in the first half of 2024 and that the growth is continuing into the second half as retailers in Australia report an uplift in demand for AI computers.
Where Lenovo is reporting significant growth is in their Infrastructure Solutions Group (ISG) which grew by 65%.
The Intelligent Devices Group (IDG) and Solutions and Services Group (SSG) delivered growth of 11% and 10%, respectively.
Codrington stressed that Lenovo’s ISG operation has a comprehensive AI product portfolio and ranks third globally in AI infrastructure.
He claims that Lenovo is commitment to gaining an advantage from demand for AI PC’s and systems and that the business is planning to invest US$1 billion over the next three years to accelerate the deployment of AI technologies and applications.
This investment will support the development of AI devices, AI infrastructure, and the integration of generative AI technologies into vertical industry solutions and a new generation of desktop PC’s and mobile devices.
The ISG has invested US$100 million in its AI Innovators program, delivering over 150 AI solutions and more than 70 AI-optimized platforms in its first year.
Globally the AI market expected to reach US$407 billion by 2027.
Software is projected to account for approximately US$225 billion.
Services, hardware, servers, IT services, and applications will comprise US$84 billion, US$56 billion, US$49 billion, US$15 billion, and US$14 billion, respectively.
