Lenovo is enjoying a moment. During the quarter that ended Dec. 31, the PC maker posted record quarterly sales and its highest-ever worldwide market share.
Lenovo, the world's No. 2 PC maker, saw record sales of
$8.4 billion during its fiscal 2011 third quarter, which concluded Dec. 31. Growing
faster than its top-five ranking peers, it additionally enjoyed global market
share of 14 percentits highest ever.
Lenovo, which announced its quarterly results Feb. 9, has
been executing a "protect and attack" strategyprotect its
enterprise business and strong base in China, and attack growing segments such
as smartphones and tablets. Handily, it helped Lenovo outsell the industry
averageLenovo PC shipments increased 37 percent, the company said in a
statement, while the overall industry struggled to remain flatand to work
around hard-drive shortages that are hurting competitors.
Analysts with investment firm Jefferies & Company wrote
that third-quarter "revenue and income came in better than market
expectations." Revenue, they added, was driven by strong consumer PC
growth of 71 percent year-over-year, while Lenovo's commercial PC segment grew
21 percent year-over-year.
On. Jan. 13, Gartner
Lenovo had sold nearly 13 million PCs during the quarterup from 10.5
million a year earlierand "further cemented its place as the No. 2
vendor in global PC shipments."
During the quarter, its laptop business brought in sales of
$4.5 billionan increase of 30 percent year-over-yeargenerating
43 percent of its total sales revenue.
Its growing smartphone divisionwhich saw shipments
increase "20 times year-over-year for the quarter"also
"We saw strong progress
in our Mobile Internet business. During the quarter, Lenovo sold more than 6.5
million phones, and almost half were smartphones," Lenovo Chairman and CEO
Yang Yuanqing said in a statement. "Lenovo's smartphone market share in
China reached double-digit market share in December. We also see strong
momentum in our tablet business. All these successes demonstrate that Lenovo
has built a strong foundation for the next steps beyond traditional PCs."
In China, Lenovo is the No. 2 tablet vendor, and during the third quarter grew its overall market
share to a record-high 35.3 percent.
"In the largest PC
market in the world, Lenovo widened the share gap between itself and the
company's main competitors," according to a company statement, "and
continued to outperform the China market, particularly in emerging cities and
amongst rural customers."
Apple, Nokia and other top
brands have aggressive plans for China, noting the unprecedented pace at which
its middle class is growing and their appetite for mobile electronics. With
such fast-paced growth, a few cultural stumbles along the way seem likely, and
it will be interesting to see how the China-based Lenovo can put its home
advantage to use.
The writer Chuck Salter, in
a Fast Company
article, recently summed up Lenovo by describing it as a company unlike anything we've ever seen before, a product of Communist China, influenced by the West, and with customers in 160 countries. He writes:
In just 30 years, an enterprise launched in the Beijing equivalent of a garage ... has blossomed at a pace no one predicted. Lenovo is redefining
"Made in China," producing the industry's highest-quality machines;
it ranked No. 1 in the 2011 Computer Reliability Report, ahead of Apple and HP.
And the company's culture skillfully blends an Eastern way of thinking with the
best of Western business, demonstrating innovation and nimbleness that would
impressand unnervethe most skeptical Silicon Valley digerati.