• Lenovo will leverage its coverage of all customer segments (CSP of different scale, Enterprise, SMB) as a unique advantage to balance scale and profitability, as well as customers’ demands for security/reliability and agility/flexibility.
• Investments will continue to be made in fast-growing and expanding segments such as Edge computing.

Intelligent Devices Group (IDG): strong revenue growth and stronger profitability, increasing contribution from non-PC businesses

Opportunity:

The market for smart devices continues to benefit from the new normal of hybrid working and the PC market is forecasted to remain strong and stable, shifting to commercial and premium segments. In smartphones, the market reshuffling will bring more growth opportunities to Lenovo, and the penetration of 5G and development of the New IT of ”edge-cloud-network-intelligence” will provide more growth potential for emerging smart devices such as embedded computing/IoT, AR/VR driven by the metaverse, as well as smart home and smart collaboration solutions.

Q3 performance:

• Excellent results with revenue growth of 16% year-on-year to US$17.6 billion, with even stronger profitability growth - up 21% year-on-year to US$1.4 billion, on an already high base.
• Premium PC segments delivered high growth with workstation and gaming revenue growing 40% and 27% year-on-year, respectively.
• Smartphones maintained a healthy profit for the seventh consecutive quarter, with revenue growing strongly at 46% year-on-year and becoming the fastest growing major vendor. Profit equaled the historic high of last quarter at US$89 million. Rapid growth was seen in key strongholds, with revenue in Latin America up 25% year-on-year and revenue in North America more than doubling year-on-year (133%).
• Among the emerging smart devices categories, revenue from smart collaboration solutions nearly doubled year-on-year.

Looking ahead:

• Lenovo will further invest in innovation, premium segments, and core components to drive increased profitability and average selling price. In Mobile, we will further strengthen our portfolio and invest in expanding to new markets in Europe and Asia Pacific. We also will continue to invest in non-PC products such IoT, metaverse, smart Home and smart collaboration solutions to capture emerging opportunities and further increase the non-PC business mix.

Operational highlights and investing for the future

• Lenovo continues to focus significantly on ESG through all its operations – from the use of innovative recycled materials in products such as the ThinkPad Z series launched in January 2022, to the use of carbon neutral flights for cargo shipments.
• In addition, Lenovo has recently received significant external recognition for its ESG actions and commitments, including:
  • Recognized as one of the world’s most sustainable companies by Corporate Knights
  • Secured a place on the prestigious ‘A List’ for tackling water security by global environmental non-profit CDP
  • Earned a perfect score of 100 on the 2022 Corporate Equality Index
  • Recognized on the Bloomberg Gender Equality Index
  • Named as one of the Financial Times 2022 leaders in diversity
  • Climbed the 2022 list of Fortune’s Most Admired Companies
  • Awarded gold in the Hong Kong Institute of Certified Public Accountants Best Corporate Governance and ESG Awards 2021

About Lenovo

Lenovo (HKSE: 992) (ADR: LNVGY) is a US$60 billion revenue Fortune Global 500 company serving customers in 180 markets around the world. Focused on a bold vision to deliver smarter technology for all, we are developing world-changing technologies that power (through devices and infrastructure) and empower (through solutions, services and software) millions of customers every day and together create a more inclusive, trustworthy and sustainable digital society for everyone, everywhere. To find out more visit https://www.lenovo.com and read about the latest news via our StoryHub.