Lenovo, in its earnings report for October-December fiscal 2024-25, has indicated that its strategic focus on artificial intelligence (AI) has significantly bolstered its financial performance across various business units.
Lenovo, during the third quarter of fiscal 2024-25, reported a 20 percent revenue increase, reaching $18.8 billion, marking the third consecutive quarter of double-digit growth. Net income more than doubled to $693 million.
Lenovo’s Intelligent Devices Group (IDG) achieved a 12 percent revenue growth, totaling $13.8 billion. This growth was driven by the launch of AI-powered PCs, which have gained significant traction in the market. Lenovo’s PC market share expanded to 24.3 percent, extending its lead over competitors.
Lenovo’s smartphone segment also experienced double-digit revenue growth, with notable expansion in the Asia Pacific and EMEA regions.
Lenovo’s Infrastructure Solutions Group (ISG) reported a 60 percent revenue increase, amounting to $3.9 billion, and achieved break-even status for the quarter. This surge was largely due to heightened demand for AI servers and the adoption of Lenovo’s Neptune liquid cooling solutions, which saw a 48 percent revenue growth.
Lenovo’s Solutions and Services Group (SSG) maintained its momentum with a 12 percent revenue increase, reaching $2.3 billion, and sustained an operating margin of 20 percent. This performance was bolstered by AI-powered solutions enhancing hardware-attached services and a growing share of non-hardware-tied services, which now constitute nearly 60 percent of SSG’s revenue.
Lenovo’s commitment to AI is evidenced by a 14 percent increase in R&D expenditures, totaling $621 million. This investment has facilitated the development of innovative products, such as the world’s first rollable AI laptop and AI-integrated handheld gaming devices, which collectively garnered 185 industry awards at CES 2025.
Looking ahead, Lenovo anticipates that AI PCs will constitute a significant portion of its PC shipments, projecting that AI PCs could account for up to 80 percent of the PC landscape by 2027.
This projection underscores the company’s strategic emphasis on AI as a catalyst for sustained growth and profitability across its diverse business units.
Baburajan Kizhakedath
