The tech giant Lenovo‘s recent FY22-23 results are here and they seem to be positive at a time when PC sales have slowed down. The Lenovo Group reported a revenue of US$15.3 billion and a net income of US$437 million, which is again impressive because we know Lenovo to be more focussed on the PC business primarily.
Lenovo’s Q3 FY22-23 results out
Interestingly, the revenue from non-PC businesses reached a high of 41% and profitability remained solid as Lenovo’s diversified growth engines of Solutions and Services Group (SSG) and Infrastructure Solutions Group (ISG) grew revenue to record highs of US$1.8 billion and US$2.9 billion respectively, up 23% and 48% year-on-year.
The company even says in the PC sector, real demand, as reflected by the activation data in 2022, is much better than the industry shipment data indicates as the channel consumes excess inventory. Not only that, Lenovo Group expects year-on-year growth to resume in the second half of the calendar year with end-user demand to be higher than pre-Covid levels.
To further strengthen its cost competitiveness, Lenovo will be working on this by investing in high-margin growth engines as well as reducing run-rate operational expenses. Lenovo’s cash balance remains strong, the cash conversion cycle continues to improve, channel inventory has been reduced, and the company continues to invest in R&D and sustainability.
Financial Highlights:
Chairman and CEO quote – Yuanqing Yang:
“Today’s solid results demonstrate that our service-led transformation strategy is paying off. Our diversified growth engines of non-PC business now account for over 40% of our group revenue and are driving solid profitability. Despite the complex macro environment, we retained our market leadership in PCs. I remain confident that our clear strategy, operational resilience, healthy liquidity, and continued investment in innovation will ensure we can deliver long-term sustainable growth and improved profitability.”
“With total revenue of over US$ 400 million across all Lenovo portfolios in India in Q3 FY22/23, we continue to see strong momentum for our services and solutions business in India. We are committed to investing in capability building to deliver for our customers beyond end-point devices and achieve our service-led transformation objectives with a broad suite of pocket-to-cloud offerings. We have taken concrete steps on the ESG front, which help our customers reduce their carbon footprint (CO2 Offset services) and e-waste management (Asset Recovery Services). With the help of new IT solutions, we are on our journey to becoming an end-to-end technology partner that enables intelligent transformation for our customers.” – Shailendra Katyal, Managing Director, Lenovo India
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