Lenovo reports 19 per cent rise in quarterly profit on sales growth outside China

BEIJING, China – Lenovo Group, the world’s biggest personal computer maker, said Thursday its latest quarterly profit rose 19 per cent, driven by sales growth outside its home China market.

Profit rose to $262 million, or 2.5 cents per share, in the three months ended Sept. 30, the company said. Revenue rose 7 per cent to $10.5 billion.

Lenovo, with headquarters in Beijing and in Research Triangle Park, North Carolina, is in the midst of a multibillion-dollar effort to expand beyond its traditional PC business into mobile devices, infrastructure to support them and business services.

Last month, it completed its $2.9 billion acquisition of Motorola Mobility from Google Inc., which Lenovo said made it the third-largest global smartphone manufacturer. In September, the company announced the completion of its $2.1 billion purchase of IBM Corp.’s low-end server business.

“Mobile and Enterprise are now our new growth engines, and over time, like PCs, they will become our profit pool as well,” said chairman Yang Yuanqing in a statement.

Quarterly sales in China declined 2 per cent from the same quarter last year, offset by a 33 per cent rise in Europe, the Middle East and Africa and a 3 per cent rise in the Asia-Pacific region. Sales in North America were flat.

Sales of smartphones, tables and other mobile devices declined 6 per cent while those of Lenovo’s traditional desktop PCs rose 6.4 per cent. The company said smartphone shipments rose 38 per cent.

Also Thursday, Lenovo announced the appointment of Yahoo Inc. co-founder Jerry Yang as an independent non-executive member of its board of directors.