News: The company plans to refocus on high-growth segments.
Lenovo saw its revenues drop 6 percent in its Q1 results as it blamed a wider slowdown in its core markets.
Revenues for the quarter were $10.1 billion.
Lenovo’s gross profit for the first fiscal quarter decreased 7 percent year-over-year to $1.5 billion The company saw a net income of $173 million, a 64 percent increase year-on-year.
The PC and Smart Device Business Group saw revenues fall 7 percent to $7 billion, in the mobile business group they fell 6 percent to $1.7 billion and in the data centre business group sales rose 1 percent to $1.1 billion.
Lenovo shipped 13.2 million PCs in the quarter, a 2.3 percent fall.
In a statement, Lenovo said that this performance “occurred during a period when the core markets saw either slow growth or year-over-year industry declines.”
It cited a 4.1 percent fall in PCs, 11.1 percent in tablets and close to flat server and smartphone markets.
“Although the macro-economy and our industries remain challenging, causing a decline in our revenue, we significantly improved our profit year-on-year through innovative products and strong execution. Our PC business delivered strong profits and our smartphone business stabilised compared to last quarter,” said Yuanqing Yang, Chairman and CEO of Lenovo.
Yang said that the company would focus, in the PC market, on high-growth segments and use industry consolidation to resume growth.
In smartphones, he said that the company’s focus would be on “innovative, differentiated products”. For the middle market, the mobile group is streamlining costs and expenses, while at the high end it is focusing on innovation.
In data centres the company will expand in hyperconverged technology and aim to improve its profitability in the hyperscale business. The data centre group plans to invest in sales force capabilities, marketing, channel programs and portfolio partners to drive future growth opportunities
[Source:-CBR]
