PC growth boosts Lenovo's Q1 showing

Chinese PC maker rides on continued PC shipment growth of 24.4 percent year-on-year to report US$8 billion in sales for its first quarter earnings.

Lenovo on Thursday reveals quarterly sales for the first quarter of 2012 has reached US$8 billion, which is a 35 percent increase year on-year. The positive result comes on the back of its continued expansion in the PC market, as the world's second-largest manufacturer marked its 13th consecutive quarter of outpacing the industry's growth.

In a statement released today, the Chinese company said its PC business achieved its highest-ever quarterly market share of 15.4 percent, according to IDC findings, and shipments for the first quarter ended Jun. 30 increased by 24.4 percent compared to the same time last year. It also said its shipment growth represents the 11th quarter the company had grew faster than any of the other top four PC vendors .

Laptop devices, in particular, remained the largest contributor to Lenovo's global sales, generating 54 percent of its total sales revenue which totaled US$4.3 billion. Desktops, by comparison, grew 26 percent year-on-year to US$2.5 billion, which represented 32 percent of the company's overall sales revenue, it noted.

Its strong showing in the PC sector helped Lenovo increase its net income by 30 percent year-on-year to US$141 million, while its gross profit rose by the same percentage and operating profit grew 48 percent to US$182 million, the statement noted.

The company's "protect and attack " strategy of reinforcing its business in established markets while going after potential new ones has also helped it ensure business growth was balanced across all geographies, customer segments, and product lines.

It cited the recent global partnership with EMC as an example. The server technology development program will help Lenovo extend its capabilities and reach in the x86 server market, allowing it to market its servers with the Lenovo brand as well as embed them in select EMC storage systems over time.

Commenting on these results, company Chairman and CEO Yang Yuanqing said in the statement: "Our business in China and our global commercial business maintained strong profitability, which allows us to secure plenty of resources to invest in growth areas and ensure the company's overall healthy performance.

"Although the economic environment is somewhat similar to the 2008-2009 downturn, Lenovo's results are much stronger because we have the right strategy and great execution. [We] are confident that by continuing to execute our 'protect and attack' strategy, Lenovo can achieve sustainable growth and healthy returns in the PC plus era."