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InvestmentsChina's Lenovo beats chip shortage to post 65% rise in Q2 profit...

China’s Lenovo beats chip shortage to post 65% rise in Q2 profit By Reuters

© Reuters. FILE PHOTO: A Lenovo emblem is seen on the pc in Kiev, Ukraine April 21, 2016. REUTERS/Gleb Garanich

By Brenda Goh

SHANGHAI (Reuters) -China’s Lenovo Group (OTC:), the world’s greatest maker of non-public computer systems, reported a 65% rise in second-quarter profit on Thursday and mentioned it was ready to outgrow the market by securing extra parts amid a worldwide chip shortage.

Profit for the quarter ended Sept. 30 attributable to fairness holders jumped to $512 million versus $310 million in the identical interval a 12 months earlier, and Lenovo mentioned it remained on monitor in the direction of its aim of doubling profitability in three years.

Revenue rose 23% to $17.9 billion, barely above a median estimate of $17.3 billion from 9 analysts, in accordance to Refinitiv information.

“The industry-wide component shortage of various integrated circuits (ICs) remained a business challenge, causing delays in order fulfilment and significant back-log orders across PCs, smartphones, and servers,” it mentioned in a press release.

“The group was able to excel in operational efficiency by securing more supply of components than peers to outgrow the market.”

It additionally mentioned that it noticed sturdy gross sales progress in China and America, however a decline elsewhere in the Asia Pacific due to fewer instructional offers in Japan.

Growth in worldwide PC shipments slowed in the September quarter as easing anti-virus measures and the rising availability of COVID-19 vaccines shifted client and academic spending away from PCs to different priorities, in accordance to analysis consultancy Gartner (NYSE:) mentioned https://www.gartner.com/en/newsroom/press-releases/2021-10-11-gartner-says-worldwide-pc-shipments-grew-1-percent-in-third-quarter-of-2021.

Lenovo retained the title of largest worldwide PC vendor by shipments, although its progress slowed after 5 consecutive quarters of double digit progress, Gartner mentioned. In the third quarter, Lenovo’s international market share grew 1.8% to 23.7%.

Shares in Lenovo tumbled final month after it abruptly withdrew its software for a ten billion yuan ($1.55 billion) share itemizing in Shanghai, days after it had been accepted by Shanghai’s STAR Market.

But its Hong Kong shares are nonetheless up greater than 70% over the previous 12 months, boosted by sturdy demand for electronics as extra folks do business from home.

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