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Lenovo rises as mobile, data server player

Updated: 2013-11-08 10:21
( Agencies)

Lenovo rises as mobile, data server player

A Lenovo PC advertisement is seen in Shanghai, Jan 27, 2013. [Photo by Jiangwei / Asianewsphoto]


BEIJING - China's Lenovo Group Ltd, the world's biggest personal computer maker, is reinventing itself as a growing force in mobile devices and data storage servers to beat the slump in the PC market that is crippling less agile rivals.

Lenovo said on Thursday net profit beat estimates, jumping over a third in July-September to a quarterly record of $219.7 million.

Now the world's fourth-biggest smartphone maker, the company also said it's looking for new businesses to buy as it remoulds itself. It has $2.87 billion in cash and equivalents on its balance sheet three decades after it was founded in Beijing with a staff of 11.

The progress at Lenovo, with a 17.7 percent share of worldwide PC shipments according to research firm IDC, is in sharp contrast with that of other PC makers like Acer Incorporated. Acer's chief executive stepped down this week after poor results at the Taiwan firm in a quarter when the PC industry contracted 7.6 percent globally, according to IDC.

Lenovo's continuing cruise into smartphones, tablets and network storage systems extended its streak of double-digit quarterly growth to over three years. Desktop PCs were its only business line not to grow as July-September net profit surged compared with $162 million a year ago and a $199.12 million consensus forecast on Thomson Reuters Starmine SmartEstimate.

Some of its future acquisition targets will be in the growing market for cloud computing and back-end information storage that's lured companies from rival IBM to Internet retailer Amazon.com Inc, Lenovo said.

"We don't have an exact plan, but I hope in five years our new businesses, including mobile, with tablet, and enterprise, will account for 50 percent" of sales, Chief Executive Yang Yuanqing said in a telephone interview with Reuters.

Aside from grabbing headlines by hiring Hollywood star Ashton Kutcher as a part-time product engineer on its Yoga tablet computers, Lenovo stands out from peers for its ability to embrace change.

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