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Lenovo Q2 profit jumps 20% on strong personal computer sales

Lenovo's net profit in the quarter ended September rose to $202 million, compared with an average estimate of $199.59 million by eight analysts

twitter-logo Reuters   SHANGHAI     Last Updated: November 7, 2019  | 11:48 IST
Lenovo Q2 profit jumps 20% on strong personal computer sales
Lenovo's net profit in the quarter ended September rose to $202 million (Photo: Reuters)

Chinese personal computer maker Lenovo Group Ltd (0992.HK) reported a 20% year-on-year jump in second-quarter profit on Thursday, slightly beating analysts' estimates, on the back of strengthening demand for its products.

Lenovo's net profit in the quarter ended September rose to $202 million, compared with an average estimate of $199.59 million by eight analysts, according to Refinitiv data. Revenue rose 1% to $13.52 billion, compared to an average estimate of $13.73 billion by 11 analysts.

"Looking ahead, the global demand for technology products is expected to remain volatile amid a complex macro environment," the company said in a statement.

"However, going forward, Lenovo is well-positioned to manage complex and dynamic market conditions."

China's Lenovo Group, the world's largest PC maker, warned in August that it would have to raise prices if U.S. tariffs increased, and that shifting manufacturing from China to avoid tariffs could further bump up costs.

Laptop computers are among $156 billion worth of Chinese goods that Washington has threatened to hit with tariffs on Dec. 15, along with cell phones and toys.

Beijing is expected to ask Washington to drop that plan as part of a deal both sides say they are close to finalising on some parts of a trade agreement.

The global PC market grew 1.1% in the quarter to September, as customers replaced machines to migrate to Windows 10, market research firm Gartner said last month. Lenovo took a 24.7% market share during the quarter, ahead of rivals HP Inc (HPQ.N) and Dell, it said.

IDC, another market research firm, said in October that sales during the quarter were boosted by the threat of higher tariffs which spurred PC makers to ship additional desktops and notebooks, although some were hampered by supply constraints.

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