May 20, 2020 | 13:00
Lenovo has reported strong financial results for its full fiscal year and Q4, despite the COVID-19 pandemic affecting its figures.
The group saw full-year revenue exceeding $50 billion for the second consecutive year with pre-tax income at $1.02 billion, up almost 19 percent year-on-year. Alongside that, full-year net income was $665 million, up 12% year-on-year. Understandably then, Yang Yuanqing, Lenovo Chairman and CEO, said in response, "I am also unbelievably proud of how we continue to respond to the global pandemic, as both a business and a corporate citizen. While the world continues to face uncertain times, I'm confident Lenovo will leverage its operational excellence and global footprint to continue implementing our intelligent transformation strategy and fully grasp the opportunities our 'new norm' provides us."
Granted, the pandemic certainly had an effect on how Lenovo performed. Its Q4 revenue was $10.7 billion, down $900 million, mostly due to the ongoing situation. Supply chain constraints certainly didn't help here with the same quarter seeing net income at $43 million, down $75 million year-on-year. As Lenovo explained, its second business group, the Mobile Business Group (think Motorola) was on target for a breakthrough year until the impact of the required closure of its primary smartphone factory in Wuhan. That led to MBG revenue declining and a pre-tax loss of $43 million. Still, at least it was on target until the precedented event.
Where there was strong and sustainable growth in areas such as gaming, workstations, thin and light laptops, and Chromebooks, with each outgrowing the market by double digits in volume. The working from home drive no doubt helping here.
There was also double-digit revenue growth in Software Defined Infrastructure, Storage, Software and Services with storage revenue growing more than 50 percent year-on-year, even if the Data Center Group saw overall revenue decline 8.7 percent year-on-year.
It seems that the plans for the 20/21 financial year is to "promptly act on industry growth opportunities, including the surge of work-from-home and study-at-home tailwinds as a result of the paradigm shift of COVID-19" which is probably what a lot of companies are vowing right now. In these uncertain times, at least Lenovo is in a fairly comfortable position if not quite as comfortable as investors may have wished for right now.
July 1 2020 | 17:34