Lenovo Group, the world's fourth-largest PC maker, saw quaterly earnings rise 65% for Q1, but profit margins fall dramatically.
Net profits rose to $110.49 million, up from $66.84 million a year ago, but profit margins in the US fell dramatically to 0.3% from 3.4%. Even in China margins fell from 7.3% a year ago to 6.8%. The company blamed the economic slowdown in the US and weaker demand in China following a devastating earthquake.
Lenovo is up against some big hitters (it ranks fourth, behind HP, Dell and Acer) but it benefits from holding onto a large market share in China. This could give the company an edge if rivals see significant falls in profit margins in the US. It'll be interesting to see if Lenovo still ranks fourth this time next year.