MORRISVILLE – Lenovo rode increasing demand for a wide variety of products and services, including its world-leading PC business, to report records for revenue and profits during the year of COVID-19.

Corporate revenues soared to $60 billion – up $10 billion from the previous year.

And earnings hit $1.2 billion, up 70% year over year.

The performance led CEO and Chair Yang Yuanqing to hail the firm’s performance.

Lenovo’s president: ‘Relentless commitment’ is key to record fiscal year results

Infographic: Breaking down Lenovo’s record-setting year

“Last quarter, we delivered our fastest growing quarter in almost a decade and closed the fiscal year with the new milestone of passing US$60 billion in revenue and significant growth in profit to a new record,” he said in a statement.

“These historic highs were achieved by leveraging our core competencies of a clear strategy, innovative products, operational excellence, and global-local model to meet the new needs in the New Normal.”

A key to growth: Surging demand for PCs and smart devices to meet global needs created by the pandemic for work-from-home and education at home.

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A strong fiscal fourth quarter ending March 31 delivered profits of $260 million, which blew past seven analysts’ expectations of $204.7 million as polled by Refinitiv.

Revenue soared some 48% to nearly $16 billion. Analysts had projected $14.3 billion.

But Yang is already looking ahead.

“Looking forward, we will capture the huge growth opportunities created by the market trends of information consumption upgrade, infrastructure upgrade and application upgrade to drive long-term sustainable growth and ensure we can build an even smarter future in the years ahead,” Yang said.

Lenovo, which operates global headquarters in Beijing and Morrisville, also implemented a corporate restructuring in April which led to the selection of a new president for its North America operations.

The company is focused on a so-called 3S (Smart IoT, Smart Infrastructure, Smart Solutions) strategy and it reported “double-digit revenue growth across all core businesses.”

Financial highlights as reported by Lenovo:

  • Best fourth quarter ever for PC and Smart Devices (PCSD) with US$12.4 billion in revenue, up 46% year-on-year and profitability at an all-time high of 6.7%.
  • All geographies realized high double-digit growth in PCSD revenue and PC volume outgrew the market – further strengthening the company’s global #1 ranking in PCs.
  • Tablets had a breakthrough quarter, with shipments growing 157% year-on-year – around three times as fast as the market.
  • High growth and premium segment volumes (Gaming, Thin & Light, Chromebooks, Visuals) continue to outgrow the market and deliver strong double to triple-digit growth rates.
  • Revenue from the Mobile Business Group (MBG) achieved hyper-growth, up 86% year-on-year to US$1.54 billion – achieving pre-tax income of US$21 million – a record high since the Motorola acquisition.
  • Expanded carrier relationships and a strong product portfolio, including 5G products, saw smartphone volumes grow at triple digit rate in North America, Europe, and Asia Pacific.
  • Smartphone market share in our Latin America stronghold reached a record of nearly 21%.
  • Revenue for the Data Center Group (DCG) was strong, growing 32% year-on-year to US$1.6 billion, the fifth straight quarter of premium-to-market growth. Profitability improved 4.4 points year-on-year.
  • The Cloud Service Provider business grew 73% year-on-year and at a 61-point premium to the market.
  • Record high fourth quarter revenue was achieved for Server, Storage, Software Defined Infrastructure, Software, and HPC/AI.
  • Traditional storage was a particular highlight growing at 73% year-on-year.
  • Burgeoning Edge business delivering strong signs of future growth.
  • Transformation businesses also achieved record growth, fueled by ongoing strong growth in services and software revenue* up 44% year-on-year. Managed Services revenue* (DaaS, TruScale) nearly doubled, and Solutions revenue* grew 65% year-on-year.
    Fiscal year milestone fueled by leveraging core competencies of clear strategy, product innovation, operational excellence, and Global/Local model

Lenovo’s big news day: Profit and revenue records; No. 2 exec retiring; new service group