PC manufacturer Lenovo has posted another positive quarter after it returned to growth (3 per cent) in Q3, this time posting a 10 per cent increase in revenue year-on-year to $13.8bn (£10.76bn).
However, this wasn’t enough to offset a miserable financial year, which was still down by eight per cent to $56.8bn (£44.30bn).
Lenovo’s Q4 FY23/24 report mentioned other areas of expansion and growth, including its pocket-to-cloud AI portfolio, solutions and services group (SSG) and infrastructure solutions group (ISG), intelligent devices group (IDG), and commitment to sustainable growth.
The company reported strong revenue growth across all business groups in Q4, with group revenue increasing nearly 10 per cent year-on-year to $13.8bn (approximately £10.76bn.
Net income doubled year-on-year to $248m (£193.44m) and non-PC revenue mix reached a “historic high” of 45 per cent.
Yearly turnover, however, was still down eight per cent compared to the previous year, a symptom of the PC industry’s economic struggles.
Lenovo’s pocket-to-cloud portfolio, ecosystem partnerships, and full-stack AI capabilities lead the vendor’s AI strategy.
The company expects the AI PC market to grow from premium to mainstream over the next three years, driving a new refresh cycle.
The full-stack “pocket-to-cloud” AI portfolio spanning devices, infrastructure, and services integrates personal AI agents, heterogeneous computing, and on-device AI capabilities.
Lenovo expects the premium AI PC segment to go mainstream within three years, driving an industry refresh cycle.
Lenovo’s enterprise-focused groups SSG and ISG delivered impressive results fuelled by accelerating AI adoption.
SSG’s revenue grew over 10 per cent in Q4 to $1.8bn (£1.40bn) with more than 21 per cent operating margins, driven by managed services and AI-powered workplace solutions.
ISG hit record Q4 revenue, up 15 per cent year-over-year, with storage, software and AI server sales seeing significant growth.
With AI infrastructure demand outpacing traditional servers, ISG is broadening its AI portfolio.
Consulting, infrastructure and service deployment drove much of the demand as groups capitalised on customers seeking comprehensive AI solutions.
Lenovo says its strength validates its strategy of being an end-to-end AI provider across the entire technology stack.
Lenovo’s IDG captured 22.9 per cent PC market share and industry-leading profitability. IDG ranked first in four out of five regions, with an over 30 per cent share in North America.
The smartphone business also shone, with double-digit shipment and revenue growth outpacing the market.
After a soft first half, PCs, tablets and phones resumed growth in the second half. Looking ahead, Lenovo expects the overall PC market to recover to pre-pandemic levels, with smartphones already seeing double-digit growth.
The company said it is doubling down on innovation for sustainable growth, allocating 26.2 per cent of its workforce and 3.6 per cent of revenue to R&D.
The investments target Lenovo’s anchor AI and computing technologies to realise its “Smarter AI for All” vision. It has also been pushing forward on its environmental certifications.
