The revenues of Lenovo Fall Yet Again

The revenue of the company, Lenovo fell consecutively for the 5th quarter as well. Lenovo has two primary lines of business – the servers and the smartphones. Both of these lines suffered a decline in sales by a rate of 20 percent or more and this caused the revenue of the company to fall even more.

The company has gained the topmost rank in the sales of PCs across the world. In the 3rd fiscal quarter, Lenovo posted revenue that was worth 12.2 billion dollars, which is a drop of 6 percent. This fiscal quarter had ended on 31st of December. In spite of the loss incurred by Lenovo, it had beaten the target of 11.7 billion dollars, which was predicted by the analysts of Bloomberg News.

Moreover, the analysts had projected Lenovo’s net income to drop by 145.9 million dollars; however, the income witnessed a drop of 67 percent (that is 98 million dollars).

Chris Yim, an analyst from BOCOM International told Bloomberg that the market for PC is likely to get more stabilizing globally. This is going to benefit Lenovo and their net incomes will become better and go up.

In the year 2014, Lenovo had made efforts to overcome its position in the weak PC market. It had spent lots of capital to enhance its smartphone functionalities and had also acquired Google’s Motorola Mobility. To consolidate its server business, it had bought IBM’s several lines of servers. But all these efforts have not made their expected contributions yet. In the earnings announcement, Lenovo declared that their company witnessed slow growth or absolutely no growth in all the 3 core lines of business in the markets all around the world.

With more than three thousand employees, Lenovo has its basis in China, but operates from the headquarters in Morrisville.

A sum of 8.6 billion dollars was totaled in the revenue of tablets and PC. The rate was approximately 2 percent higher the last year, but the North America PC shipments made the revenue rate go high up to 14 percent.

IDC, a firm working in the market research, revealed that the overall shipments of PC by Lenovo had outpaced the international market and reinforced its topmost rank in the recent quarter. However, the rivals of Lenovo like Dell Technologies and HP bridged the gap by their rapid growth.

The mobile business of Lenovo, inclusive of Lenovo and Moto smartphones, experienced a decline of 23 percent reaching 2.2 billion dollars. The storage device and server business experienced a 20 percent decrease reaching 1.1 billion dollars.

Yang Yuanqing, the CEO however is optimistic and said that the company will soon reach the break-even and make significant growth in earning profits.

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