Lenovo has unveiled its financial results for the fourth quarter, ended on 31 March, revealing above-estimate profits fuelled by the surge in demand for laptops and PCs during the pandemic.
The Chinese tech giant reported the highest profit growth rate in two years, at 512%, with a Q4 net income of $260 million (£183.4 million). By comparison, the amount predicted by analysts averaged at $204.7 million (£144.4 million), as reported by Reuters.
The company's revenues also exceeded the $14.33 billion (£10.11 billion) forecast by analysts, achieving instead $15.63 billion (£11 billion) – a 48% rise from last year's $10.58 billion (£7.46 billion).
Lenovo attributed the performance to the sales of its PCs and smart devices, which generated $12.4 billion in revenue, up 46% year-on-year. The company said that the quarter had been "the best fourth quarter ever" for these devices, with profitability at an "all-time high" of 6.7%. Tablets alone experienced a "breakthrough quarter", with a 157% year-on-year growth in shipments.
Last month, both IDC and Gartner placed Lenovo as the number one PC manufacturer, with roughly 25% of the market. According to Gartner, the PC market was at its fastest year-over-year growth in two decades, with global sales at 69.9 million units for the first three months of 2021, up 32% compared to Q1 2020. Meanwhile, IDC suggested the market has grown by 55% year-on-year with an estimated 83.9 million PCs sold during the first quarter.
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This is following a record-breaking 2020, when PC shipments managed to reach a 10-year high due to the pandemic-induced mass switch to remote working which, despite the vaccine rollout, will likely continue until at least the end of 2021. PCs were also seemingly unhindered by the ongoing component shortages.
Commenting on the financial results, Lenovo chairman and CEO Yuanqing Yang attributed the achievements to the company's ability to meet "the new needs in the New Normal", and also outlined the next steps for the tech giant:
"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," he said.
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