This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Dell's Pain Means Gain for China's Lenovo

BEIJING -- During a sultry August in Beijing, local PC giant Lenovo was kicking the heat up even higher on a struggling Dell (DELL - Get Report).

In less than a month, Lenovo has poached nearly half a dozen of Dell's key Asia executives -- a move likely to bolster its standing outside its home market and deal a setback to Dell.

The incoming Lenovo hires, all announced between Aug. 17 and Aug. 31, include:

  • David Miller, formerly president of Dell China, will become president of Asia Pacific for Lenovo.
  • Sotaro Amano, new president of Lenovo Japan, had been corporate director of Japan home and business sales for Dell.
  • Gerry Smith has been tapped as senior vice president of Lenovo's global supply chain; previously he ran Dell's design center and displays business unit in Singapore.
  • David Schmoock will lead a new Lenovo organization focused on supply/demand forecasting, pricing and sales strategies, leaving his old role as Dell's vice president of marketing for Asia-Pacific/Japan.
  • Christopher Askew has been named senior vice president of Lenovo Services, after serving as vice president of Dell's services unit in Asia-Pacific/Japan.

"It's a coup for Lenovo," says Victor Ma, a Hong Kong-based analyst for Morgan Stanley. "Given that Lenovo CEO Bill Amelio came from Dell, it's within expectations that he would take some of his troops to the new company. But the surprise is how many people have left, which is obviously symptomatic of the problems Dell's having."

Indeed, the defections come as Dell is struggling with a string of disappointing quarters and an embarrassing battery recall announced in August.

Meanwhile, Lenovo, which closed on its acquisition of IBM's (IBM - Get Report) PC business in May 2005, seems to be gaining momentum.

The top-ranked China PC outfit, which last year moved its headquarters from Beijing to Westchester County, N.Y., beat Wall Street expectations in its fiscal first-quarter earnings report in August. It reversed the prior quarter's loss with a slim $5 million profit, including restructuring charges. Sales of $3.5 billion were up 38% over year-ago levels.

The string of staff defections from rival Dell stands to further boost Lenovo's morale.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
DELL $0.00 0.00%
HPQ $33.64 -0.41%
IBM $170.87 -0.66%
AAPL $131.52 -0.40%
FB $80.18 -0.46%

Markets

DOW 18,081.81 -81.18 -0.45%
S&P 500 2,115.83 -7.65 -0.36%
NASDAQ 5,091.4890 -15.1040 -0.30%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs