Lenovo says quarterly profit nearly doubles

Aug 18, 2011 By JOE McDONALD , AP Business Writer
In this May 26, 2011 file photo, from left, Lenovo Group Limited President and Chief Operating Officer Rory Read, Chief Executive Officer Yang Yuanqing, Chairman of the Board Liu Chuanzhi and Chief Financial Officer Wong Wai Ming, show Lenovo products before announcing its fiscal profit in Hong Kong. Lenovo Group, the world's No. 3 personal computer manufacturer, said Thursday, Aug. 18, 2011, its profit in the latest quarter nearly doubled on strong sales in emerging markets. Profit for the three months ending June 30 was $108 million, or 1.11 U.S. cents per share, up 98 percent from a year ago, the company said. (AP Photo/Kin Cheung, File)

(AP) -- Lenovo Group, the world's No. 3 personal computer manufacturer, said Thursday its quarterly profit nearly doubled on strong emerging market sales.

The results come as Lenovo expands into mobile Internet, competing with Apple Inc. and other foreign rivals, and in developed markets with an acquisition this year in Germany and a joint venture in Japan.

Profit for the three months ending June 30 was $108 million, or 1.11 U.S. cents per share, up 98 percent from a year earlier, Lenovo said. It said sales rose 15 percent from the same period last year to a quarterly record of $5.9 billion and hit a high of 12.2 percent.

Lenovo, which acquired IBM Corp.'s PC unit in 2005, overtook Taiwan's Acer Group this year to become the third-largest , according to International Data Corp.

After spending the past two years focusing on expanding sales, Lenovo is changing strategy to give equal emphasis to profits, said CEO Yang Yuanqing in a conference call with reporters.

"We will continue to invest in capturing growth in emerging markets while focusing on improving profitability," Yang said.

Lenovo entered wireless Internet last year and has launched smartphones and Web-linked in competition with Apple, South Korea's Corp. and Taiwan's HTC Corp. It unveiled a low-priced smartphone last week to target developing markets.

The company's tablet shipments in China have lagged behind Apple's popular but Yang said that was due partly to supply constraints. He said the company is aiming to achieve a 20 percent share in that market within a year.

Lenovo said PC shipments in Africa, Latin America and other rose 45.7 percent in the latest quarter over a year earlier.

In China, which provides nearly half of Lenovo's sales, rose 23.4 percent in the quarter.

Shipments in North America rose 30.8 percent while those in Japan were up 14 percent.

In a reflection of Lenovo's growth in mature markets such as Europe and the United States, they provided $77 million of the , compared with a $9 million loss a year earlier, said chairman Liu Chuanzhi.

"This is a major improvement," Liu said on the conference call.

Lenovo announced its acquisition of Germany's Medion AG, a maker of multimedia products and consumer electronics, in June. It said that would make it the second-largest PC vendor in Europe's biggest computer market.

Also this year, Lenovo launched a joint venture with Japan's NEC Corp., expanding its presence in the Japanese market.

In June, the company announced that Yang, the CEO, bought 797 million shares in Lenovo from its parent company, Legend Holdings Ltd. That made him its second-largest owner after the holding company, with an 8 percent stake.

Liu said that reflected Lenovo's desire for its top managers to have an ownership stake in the company, which he said would improve performance. Executives on Thursday's conference call did not respond to a question about whether further share purchases by management were expected.

Explore further: Ex-Apple chief plans mobile phone for India

not rated yet
add to favorites email to friend print save as pdf

Related Stories

PC maker Lenovo's quarterly profit up 45 percent

Nov 10, 2010

(AP) -- Lenovo Group, the world's fourth-largest personal computer maker, said Wednesday its latest quarterly profit rose 45 percent on strong sales in China and other emerging markets.

PC maker Lenovo says profit up 25 percent

Feb 17, 2011

(AP) -- Chinese personal computer maker Lenovo said Thursday its quarterly profit rose 25 percent on double-digit sales growth in developing markets.

PC maker Lenovo reports loss amid weak demand

Aug 06, 2009

(AP) -- Lenovo Group, the world's fourth-largest personal computer maker, reported a $16 million quarterly loss Thursday and said it faces pressure from weak global demand and intense competition.

PC maker Lenovo turns to profit on China sales

Aug 19, 2010

(AP) -- Lenovo Group, the fourth-largest personal computer maker, said Thursday it rebounded to a quarterly profit from a loss a year earlier, driven by strong sales in China and other emerging markets.

Lenovo says business will focus on mobile Internet

Mar 12, 2010

(AP) -- Lenovo Group expects wireless Internet products to account for up to 80 percent of its sales within five years as it pursues expansion in faster-growing emerging markets, CEO Yang Yuanqing said Friday.

Recommended for you

Ex-Apple chief plans mobile phone for India

8 hours ago

Former Apple chief executive John Sculley, whose marketing skills helped bring the personal computer to desktops worldwide, says he plans to launch a mobile phone in India to exploit its still largely untapped ...

Airbnb rental site raises $450 mn

21 hours ago

Online lodging listings website Airbnb inked a $450 million funding deal with investors led by TPG, a source close to the matter said Friday.

US venture investments highest since 2001 (Update)

Apr 18, 2014

Funding for U.S. startup companies soared 57 percent in the first quarter to a level not seen since 2001, as venture capitalists piled more money into a growing number of deals, according to a report due out Friday.

User comments : 0

More news stories

Ex-Apple chief plans mobile phone for India

Former Apple chief executive John Sculley, whose marketing skills helped bring the personal computer to desktops worldwide, says he plans to launch a mobile phone in India to exploit its still largely untapped ...

Airbnb rental site raises $450 mn

Online lodging listings website Airbnb inked a $450 million funding deal with investors led by TPG, a source close to the matter said Friday.

Health care site flagged in Heartbleed review

People with accounts on the enrollment website for President Barack Obama's signature health care law are being told to change their passwords following an administration-wide review of the government's vulnerability to the ...

A homemade solar lamp for developing countries

(Phys.org) —The solar lamp developed by the start-up LEDsafari is a more effective, safer, and less expensive form of illumination than the traditional oil lamp currently used by more than one billion people ...

NASA's space station Robonaut finally getting legs

Robonaut, the first out-of-this-world humanoid, is finally getting its space legs. For three years, Robonaut has had to manage from the waist up. This new pair of legs means the experimental robot—now stuck ...

Filipino tests negative for Middle East virus

A Filipino nurse who tested positive for the Middle East virus has been found free of infection in a subsequent examination after he returned home, Philippine health officials said Saturday.

Egypt archaeologists find ancient writer's tomb

Egypt's minister of antiquities says a team of Spanish archaeologists has discovered two tombs in the southern part of the country, one of them belonging to a writer and containing a trove of artifacts including reed pens ...