Strong demand for PC and smart devices pushes Lenovo's Q1 revenue to $13 billion

The Chinese tech giant maintained growth despite the impacts of COVID-19.
Written by Aimee Chanthadavong, Contributor

Lenovo Group has announced it has posted positive financial results for the first quarter of 2021 despite challenging times due to the COVID-19 pandemic.

On Thursday, the Chinese electronic vendor said it delivered group revenue of just over $13 billion, up by almost 7% year on year, while net income increased by 31% to $213 million.

"Our outstanding performance last quarter proves that Lenovo has quickly regained momentum from the impact of the pandemic and is capturing the new opportunities emerging from remote working, education, and accelerated digitalisation," Lenovo chairman and CEO Yang Yuanqing said.

"While the world continues to face challenges, Lenovo is focused on delivering sustainable growth through our core businesses as well as the new services and solutions opportunities presented by our service-led intelligent transformation."

The company attributed the uplift to its PC and smart devices group (PCSD), which sits within Lenovo's intelligent devices group, alongside the mobile business group (MBG).

PCSD reported revenue grew by double digits, reaching $10.6 billion. Part of that, according to Lenovo, was underpinned by a 45% year-on-year growth in its consumer business revenue worldwide, particularly in categories such as gaming, thin and light devices, visuals, and Chromebooks which all saw double-digit growth.

Separately, revenue for PCSD in EMEA and China lifted by 30% and 18%, respectively.

The global e-commerce business also performed well during the quarter, where revenue grew over 50% year on year, Lenovo said.

The company's MBG business, however, was not so lucky. Lenovo said revenue declined year on year. Despite this, the mobile business managed to grow its market volume in Latin America, North America, and Europe.

When it came to Lenovo's intelligent transformation business unit, the company's software and services revenue saw 38% revenue growth, reaching over a $1 billion, accounting for around 7.6% of the group's total revenue.

Smart Internet of Things revenue grew 39% year on year, smart infrastructure increased 16%, managed services grew 48%, attached services went up 32%, while solutions lifted 54%. Smart verticals also increased by 65%, which Lenovo said was driven by smart city solutions in China and smart healthcare solutions in North America.

Lenovo's data centre group reported revenue closed at $1.6 billion, 20% higher than the same period last year, with the company outlining how the growth was driven by its cloud service provider business, which saw revenue lift by more than 30% year on year.

Lenovo said due to COVID-19 lockdowns, an increase in digital consumption led to greater demand for public cloud infrastructure.

As for the tech giant's enterprise and SMB business, it experienced double-digit revenue growth in areas such as software-defined infrastructure and services and high-performance computers.

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