Lenovo Q1 revenue up 10 percent to $8.8 billion

Lenovo first quarter revenue rose 10 percent to $8.8 billion. This is despite passing some of the non-profitable PC deals in India.

Lenovo’s earnings grew 23 percent to $174 million in the first quarter of FY 2014.

Operating profit grew 11 percent to $202 million.

In PC market, Lenovo market share increased by 1.7 points to 16.7 percent.

Lenovo shipped 12.6 million PCs. But the global PC industry posted 11 percent dip in shipments.

The Chinese PC maker said shipment of smart-connected devices (PC, smartphone and tablet products), rose 41 percent.

Lenovo’s combined sales of smartphones and tablets surpassed PCs for the first time ever during the quarter.

During the first quarter, Lenovo smartphone shipments grew 132 percent.

Lenovo is now the second largest smartphone company in China, growing at 121 percent.

“In a tough PC market, Lenovo became the clear #1 for the first time and continues to improve profitability. Our strong performance in PC is fueled by balanced growth, through our consistent execution of the right strategy,” Yang Yuanqing, chairman and CEO, Lenovo.

Geographical revenue

Revenue from China rose 5.6 percent to $3.7 billion in the first fiscal quarter. China accounts for 42 percent of Lenovo worldwide revenue.

Smartphones and tablets, which together grew 76 percent, contributed to Lenovo’s China growth.

In the Asia Pacific region, Lenovo’s revenue reached $1.3 billion or 15 percent of the company’s worldwide revenue.

Lenovo’s unit shipments in Asia Pacific declined 8.1 percent.

It passed on non-profitable education deals in India.

Lenovo is currently the second largest PC provider in the region with 13.2 percent market share.

Lenovo’s PC revenue in Europe/Middle East/Africa (EMEA) increased 18 percent to $1.9 billion, or 21 percent of Lenovo’s worldwide revenue.

During the quarter, Lenovo’s PC shipments in EMEA increased 18 percent compared to an overall industry decrease of PC shipments in the region of 22 percent. The company recorded market share of 13.2 percent, up 4.4 points.

In fiscal quarter one Lenovo achieved number one PC position in ten countries in the region, including Germany, and also became number one in Eastern Europe for the first time, further solidifying its number two position in the EMEA PC market.

Americas revenue rose 29 percent to $1.9 billion or 22 percent of the company’s worldwide revenue.

With results in both Brazil, the world’s third-largest PC market, and U.S., Lenovo increased its market share in the Americas to 9.7 percent, up 2.1 points.

Lenovo achieved double-digit market share in North America for the first time, benefiting by its strong growth in the U.S. commercial PC business, reporting a record-high share of 10.1 percent.

Lenovo’s PC shipments in the Americas increased 22 percent compared to an overall industry decrease of PC shipments in the Americas of four percent.

Lenovo’s Laptop computers generated 52 percent of Lenovo’s total revenue. Lenovo’s Desktop PC shipments growth was flat worldwide year-over-year during the first fiscal quarter, compared to an overall industry decrease of 9.4 percent. As a result, Lenovo gained 1.5 share points year-over-year and achieved a market share of 16 percent. Consolidated sales of Lenovo desktop PCs decreased 2.8 percent year-over-yea of the Company’s total revenue.

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