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Lenovo quarterly revenue jumps 31%, tops expectations
[BEIJING] Lenovo Group Ltd, the world's leading PC maker, said on Tuesday its third-quarter revenue rose 31 per cent to US$14.1 billion, beating investor expectations, as its smartphone division sales more than doubled.
The company said net profit was US$253 million, down from US$265 million a year prior due to ballooning operating expenses associated with two multi-billion dollar acquisitions completed in recent months.
The results beat expectations of US$13.71 billion in revenue and US$200 million in net profit, according to analysts polled by Thomson Reuters SmartEstimates.
The Beijing-based company acquired American phone brand Motorola for US$2.91 billion and IBM's low-end server unit for US$2.1 billion to expand its business beyond the declining PC market.
Lenovo, which closed the Motorola purchase in late October and included two months of Motorola's results in this quarter's earnings, touted the American handset brand's early performance and said it achieved "hyper growth" in emerging markets outside China.
Motorola sold more than 10 million handsets during the quarter, a company record, and its purchase by Lenovo made the combined company the world No. 3 smartphone maker with 6.6 per cent market share, Lenovo said.
Total sales from the mobile division rose 109 per cent to US$3.39 billion, or a quarter of the company's sales.
Lenovo continued to consolidate its hold on the shrinking PC market, reaching a record 20 per cent share during the quarter with sales of US$9.15 billion. Shipments rose 5 per cent compared to a 3 per cent decline in the broader industry, with growth particularly strong in Eastern Europe, Lenovo said.