Lenovo delivers ninth straight quarter of improved revenue and profitability as diversified new growth engines drive sustained strong performance

HONG KONG – Lenovo Group (HKSE: 992) (ADR: LNVGY) today announced strong first quarter results for the Group, improving both revenue and profitability for the ninth consecutive quarter. First quarter net income grew 11% year-on-year to US$516 million and 35% year-on-year to $556 million on a non-HKFRS [1] basis. Revenue grew to US$17 billion, up 5% year-on-year in constant currency.

The Group saw revenue from non-PC businesses reach 37%, demonstrating its services-led transformation strategy and persistent investments in diversifying the business have paid off and are driving future growth opportunities. These new growth engines of solutions and services, infrastructure solutions, and mobile businesses all grew revenue by double digits year-on-year – contributing to both topline growth and Lenovo’s wider commitment to double profitability in the midterm. The Group remains committed to doubling investments in Research and Development (R&D) and grew R&D spending 10% year on year and increased R&D headcount by 29% year on year.

Lenovo continues to seize the opportunities driven by accelerated digital/intelligent transformation and hybrid working, while successfully navigating a range of industry-wide challenges. Overall, the Group remains optimistic about the long-term industry growth potential and the opportunities afforded by its investments in new growth engines. It is confident that by leveraging its strategy and execution together with its core competencies of innovation, operational excellence, and global/local operating model, it has the agility and resilience to navigate any macro or micro challenges successfully.

Financial Highlights:

 

 

                                                                     

Q1 22/23

US$ millions

Q1 21/22

US$ millions

Change

 

 
Group Revenue 16,956 16,929 0.2%  
Pre-tax income 691 650 6%  
Net Income (profit attributable to equity holders) 516 466 11%  
Net Income (profit attributable to equity holder – non-HKFRS) [1] 556 413 35%  
 
Basic earnings per share (US cents) 4.39 4.02 0.37  

 

Chairman and CEO quote – Yuanqing Yang:

 

“We successfully grew our business and improved profitability for the ninth consecutive quarter, while our revenue mix from non-PC businesses reached 37%. These are the results of our strategic foresight and strong execution, together with our operational resilience.” said Yuanqing Yang, Lenovo Chairman and CEO. “Although external challenges may persist in the short-term, the digitalization trend continues to accelerate, and the hybrid work model is here to stay. We have confidence in capturing these opportunities and will continue to invest, innovate, and deliver sustainable growth and profitability improvements.”

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