Lenovos revenue decline accelerated last quarter blamed on the PC

Lenovo’s revenue decline accelerated last quarter, blamed on the PC downturn

China-based Lenovo Group reported a 24% decline in revenue for the quarter ended March 31, 2023 (the company’s fiscal quarter). This is broadly in line with market forecasts, according to Reuters, as demand for computers continues to fall and the company is the world’s largest PC vendor.

    Image source: Lenovo

Image source: Lenovo

According to Lenovo, revenue for its most recent quarter was $12.63 billion, down 24% from the same period in 2022. This marks the third consecutive quarter of year-over-year sales declines and the sharpest decline in 14 years. According to Renfinitiv, analysts had forecast sales of $12.74 billion. Total net income attributable to shareholders fell 72% to $114 million for the January-March period, well below guidance of $212.49 million.

For the full fiscal year, Lenovo’s revenue fell 14% to $61.9 billion, the first decline since 2019, while net income fell 21% to $1.6 billion.

It is well known that the outbreak of COVID-19 has contributed to the development of many technology companies, including Lenovo – consumers and companies bought new devices or updated the fleet of old devices. However, over the past year, revenues in this area have started to decline. Lenovo’s Intelligent Devices Group, which includes PCs, fell from $62.3 billion to $49.3 billion last year (down 21%). In general, global PC shipments fell even more sharply in the first calendar quarter of 2023, down 29% to 56.9 million units. According to IDC, the numbers are worse than the same period before the 2018 and 2019 pandemic.

To increase profits, Lenovo is expanding its non-computer business into smartphones, servers and IT services. At the same time, around 40% of the company’s total revenue last year came from Lenovo’s non-PC business share. Solutions and Services Group (SSG) and Infrastructure Solutions Group (ISG) accounted for record sales of $6.7 billion and $9.8 billion, respectively, up 22% and 37% year over year, respectively is equivalent to. It also noted that last year Lenovo increased its full-year research and development spending to $2.2 billion, a 6% increase year over year.

Sooby, it’s not necessary on the box that’s in the back of the room, in Lenovo you’ll find the stalls and the liner ается, во второй половине 2023 года рынок ПК и смарт-устройств вернётся к росту, а совокупно с ростом на рынке IT-servi so the company should be careful with the rust of the rynka in general.

Lenovo’s share price fell 3.7% in morning trade ahead of the financial results release.

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