Lenovo Posts Second Quarter 2013/14 Results
OREANDA-NEWS. Lenovo Group announced results for its second fiscal quarter ended September 30, 2013.
Quarterly revenue was USD 9.8 billion, a 13 percent increase year-over-year. Second quarter profit grew even faster with pre-tax income increasing 30 percent year-over-year to USD 265 million, while earnings grew 36 percent year-over-year to USD 220 million. Lenovo posted a record 29 million devices sold in the quarter, which is about four devices every second. The company's strong global execution of its Protect and Attack strategy, innovative product portfolio and an increasing mix of PC Plus revenues drove the results.
For the second straight quarter, Lenovo was the world's largest PC vendor*, with its highest-ever quarterly market share of 17.7 percent up 2 points year-over-year. Number one positions in five of the top seven PC markets - which cover one quarter of the world's population - supported this strong performance. Lenovo's PC shipments for the second fiscal quarter were 14.1 million units, again making it the fastest growing of the top five PC vendors. This was also the 18th quarter in a row that Lenovo outperformed the industry as a whole.
The company continues to diversify its business and build a strong foundation for the future in the PC Plus era with outstanding performance in PCs and mobile devices like tablets and smartphones. Lenovo's second quarter mix of sales from Mobile Internet and Digital Home (MIDH) products, which includes smartphones, smart TV and much its tablet business, was 15 percent of total revenues, up from eight percent one year ago and four percent two years ago, with steadily improving profitability.
In fact, Lenovo ranked second in combined PC and Tablet shipments, and was the third-largest supplier of Smart Connected Devices, which includes PC, smartphone and tablet products, growing shipments36 percent year-over-year. Lenovo's combined shipments of smartphones and tablets surpassed those of PCs for the second quarter in a row. It also continued to be the world's fourth largest smartphone supplier, rapidly expanding shipments 78 percent year-over-year. The Company's China smartphone shipments continued with strong 64percent year-over-year growth. Finally, Lenovo had a record high of 2.3 million global tablet shipments, up 4.2 times year-over-year, driven by sales outside China. Together, these results show Lenovo's rapid ongoing transformation into a PC Plus company.
The Company's gross profit for the second fiscal quarter increased 11 percent year-over-year to USD 1.27 billion, with gross margin at 12.9 percent. Operating profit for the quarter grew 38 percent year-over year to USD 283 million. Basic earnings per share for the second fiscal quarter was 2.12 US cents, or 16.44 HK cents. Net cash reserves as of September 30, 2013, totaled USD 2.6 billion. Lenovo's Board of Directors declared an interim dividend of 6 HK cents per share.