China’s Lenovo posts first revenue drop in 10 quarters as COVID lockdowns weigh By Reuters

By Josh Ye

HONG KONG (Reuters) -China’s Lenovo Group (OTC:) reported its first revenue decline in 10 quarters as a pandemic-fuelled sales boom comes to an end, with sales especially falling in China as COVID lockdowns took a toll.

The world’s largest maker of personal computers said on Thursday total revenue during the July-September quarter was $17.09 billion, down 4% from the same quarter a year ago, but coming above an average Refinitiv estimate of $16.74 billion drawn from seven analysts. That was the first decline since the March 2020 quarter.

Lenovo had already seen growth for its first-quarter revenue grind to a halt, at only 0.2%. Together with its second-quarter result, the company reported a 2% decline for its fiscal first half.

Net income attributable to shareholders for the quarter rose 6% to $541 million.

Lenovo’s struggles reflect a weakening market for PCs globally. Global PC shipments declined 15% year-over-year in the third quarter, according to a report published by data firm IDC last month.

The report also showed that Lenovo, HP (NYSE:), and Dell saw year-over-year shipments fall by 16%, 28% and 21%, respectively. The Chinese company maintained its leadership in the global PC market with a 22.7% share. Lenovo did not give shipment numbers.

In response, Lenovo has been working over the past several quarters to improve its non-PC businesses such as smartphones, servers and information technology services, which together now make up more than a third of its sales.

Chipmaker Qualcomm (NASDAQ:) expects a slump in sales as its forecast for holiday-quarter revenue fell about $2 billion short of Wall Street estimates.