No. 2 PC maker Lenovo rode market-leading PC sales and growing smartphone sales in overseas markets to record revenue and profit in its fiscal third quarter.
Lenovo, which is based in China but has an executive headquarters in Morrisville that employs about 2,000 workers, reported Wednesday that revenue rose 12 percent to $9.36 billion, ahead of the expectations of analysts polled earlier by Bloomberg News. Most of the growth was organic, but strategic acquisitions and a joint venture with data storage company EMC also figured into the total.
Net income rose 34 percent to $204.9 million. That was in line with expectations after excluding a one-time gain of $19.8 million, Bloomberg reported.
We have grown faster than the market for 15 straight quarters, and have been the fastest-growing major PC company for 13 straight quarters, CEO Yang Yuanqing said during a conference call. He added that Lenovo ranks No. 3 worldwide -- behind Apple and Samsung -- in the overall market for smart connectivity devices that include PCs, smartphones and tablets.
Yang also said that, in the U.S. market, the company is enjoying success with its new high-end products using the Windows 8 operating software from Microsoft, which overall had a soft debut last fall. Yang said that Lenovo grabbed a 30 percent share of the Windows 8 convertible market -- that is, PCs that double as tablets -- that sold for $700 or more, and a 45 percent share of the market for $900-and-above devices.
Clearly, our PC business is healthy and well continue to get it stronger, Yang said. More importantly, we have built a strong foundation for our PC-plus business, which is growing even faster.
The companys revenue from smartphones, tablets and smart TVs accounted for a record 11 percent of revenue and rose 77 percent from a year ago. The company recently launched smartphone sales in Russia and also expanded smartphone sales to India, Indonesia, the Philippines and Vietnam last year.
Worldwide PC shipment rose 7.9 percent during the quarter despite an overall decline in the market.
Despite its impressive momentum in PCs, market research firm Gartner reported earlier this month that Lenovo fell to No. 2 worldwide during the quarter, behind HP, after reaching the No. 1 ranking for the first time in the prior quarter. Rival research firm IDC ranked Lenovo No. 2 in both quarters.