Lenovo Reports Third Quarter 2012/13 Results
Lenovo Group today reported results for its third fiscal quarter ended December 31, 2012. In its best quarter ever, Lenovo continued to outgrow the market in all geographies with record sales, pre-tax income and earnings. Lenovo continued its push towards becoming the world’s leading PC maker and emerging global leader in PC Plus devices, with another quarterly sales record of $9.4 billion, an 12 percent year-over-year increase.
For 13 consecutive quarters, Lenovo has been the fastest growing major PC company. Lenovo was also recognized by IDC as the world’s third largest maker of “smart connected devices,” such as tablets, PCs and smartphones. At the same time, Lenovo had another quarter of record pre-tax income at US$246 million, demonstrating that such rapid growth is being achieved while profits increase.
Lenovo’s third quarter earnings were also a record at US$205 million, an increase of 34 percent over the last year, with gross margin at 11.8 percent. Gross profit for the third fiscal quarter increased 15 percent year-over-year, to US$1.1 billion, while operating profit for the third quarter was US$243 million, a 26 percent increase year-over-year. Basic earnings per share for the third fiscal quarter was 1.99 US cents, or 15.42 HK cents. Net cash reserves as of December 31, 2012, totaled US$4.2 billion.
The Company’s ‘Protect and Attack’ strategy – protecting the two profit pools of global commercial PC and the China businesses, while attacking three high growth opportunities in emerging markets, global consumer and PC Plus products, such as smartphones, tablets and smart TVs – continued to deliver results. This quarter, Attack businesses delivered 50 percent of the Company’s revenues, a significant increase from four years ago when the Company first launched the strategy and attack revenues were 32 percent. Further demonstrating the Company’s balance, its Mobile Internet and Digital Home (MIDH) revenues, which includes its smartphone, tablet and smart TV businesses, accounted for a record 11 percent of Company revenue this quarter, up 77 percent year over year. And for the first time, its smartphone business in China became profitable.
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