Lenovo Group: Third Quarter Results 2023/24

Infrastructure Solutions Group (ISG): Capturing opportunities in AI infrastructure

Q3 FY23/24 performance:

  • ISG delivered quarter-to-quarter revenue growth for the second consecutive quarter.
  • Combined revenue from storage, software, and services reached a record high of US$1 billion.
  • ISG expects to remain a solid #3 globally for both storage and AI infrastructure.

Opportunities and Sustainable Growth:

  • AI server is expected to grow nearly twice as fast as the total server market.
  • ISG is growing key strategic partnerships to strengthen its portfolio competitiveness.
  • The rise of AI is driving higher demand for smart infrastructure (better performance, smarter management, and lower energy consumption). Lenovo is unique with its comprehensive Edge to Cloud portfolio, AI Innovators program, and AI Innovation Centers delivering vertical and horizontal pre-validated solutions to the industry.

Intelligent Devices Group (IDG): Resumed growth and solidified leadership

Q3 FY23/24 performance:

  • IDG delivered a strong quarter with revenue resuming growth thanks to a clear strategy, consistent investment in innovation, and operational excellence.
  • Continued PC market recovery saw IDG outperforming the market and returning to year-on-year shipment growth with the highest market share since Covid at nearly 24%. North America excelled with year-on-year PC revenue growth of 20%.
  • The non-PC devices business made encouraging progress. The smartphone and tablet businesses returned to high double-digit year-on-year shipment growth with a significant premium to the market of more than 20 points. Smartphone shipments were up 32% year-to-year – with hypergrowth in Asia Pacific, EMEA and North America.

Opportunities and Sustainable Growth:

  • The trend of hybrid AI will drive the demand for client devices and another refreshment cycle, creating growth potential and margin improvements.
  • Lenovo has a unique opportunity to develop a fully unified AI experience that spans users’ digital ecosystems, including PC, tablets, and smartphones.

ESG highlights

Lenovo has been recognized for several ESG achievements over the past quarter, including:

[1] non-HKFRS measure was adjusted by excluding net fair value changes on financial assets at fair value through profit or loss, amortization of intangible assets resulting from mergers and acquisitions, mergers and acquisitions related charges; and the corresponding income tax effects, if any.

About Lenovo

Lenovo is a US$62 billion revenue global technology powerhouse, ranked #217 in the Fortune Global 500, employing 77,000 people around the world, and serving millions of customers every day in 180 markets. Focused on a bold vision to deliver smarter technology for all, Lenovo has built on its success as the world’s largest PC company by further expanding into growth areas that fuel the advancement of ‘New IT’ technologies (client, edge, cloud, network, and intelligence) including server, storage, mobile, software, solutions, and services. This transformation together with Lenovo’s world-changing innovation is building a more inclusive, trustworthy, and smarter future for everyone, everywhere. Lenovo is listed on the stock exchange of Hong Kong under Lenovo Group Limited (HKSE: 992)(ADR: LNVGY). To find out more visit https://www.lenovo.com, and read about the latest news via our StoryHub.

LENOVO GROUP

 

FINANCIAL SUMMARY

For the quarter ended December 31, 2023

(in US$ millions, except per share data)

 

 

 

 

 


Q3 23/24


Q3 22/23


Y/Y CHG

Revenue

 

15,721

15,267

3%

Gross profit

 

2,601

2,612

(0)%

Gross profit margin

 

16.5%

17.1%

(0.6) pts

Operating expenses

 

(1,988)

(1,862)

7%

R&D expenses

 

(547)

(579)

(6)%

(included in operating expenses)

 

 

 

Expenses-to-revenue ratio

 

12.6%

12.2%

0.4 pts

Operating profit

 

613

750

(18)%

Other non-operating income/(expenses) - net

 

(142)

(145)

(2)%

Pre-tax income

 

471

605

(22)%

Taxation

 

(94)

(123)

(23)%

Profit for the period

 

377

482

(22)%

Non-controlling interests

 

(40)

(45)

(11)%

Profit attributable to equity holders

 

337

437

(23)%

Profit attributable to equity holders- non-HKFRS [1]

 

357

447

(20)%

EPS (US cents)

 

 

 

 

Basic

2.81

3.65

(0.84)

Diluted

2.64

3.44

(0.80)





© 2024 Internet Business Systems, Inc.
670 Aberdeen Way, Milpitas, CA 95035
+1 (408) 882-6554 — Contact Us
ShareCG™ is a trademark of Internet Business Systems, Inc.

Report a Bug Report Abuse Make a Suggestion About Privacy Policy Contact Us User Agreement Advertise