Digitimes Research in Taiwan is reporting that Lenovo shipped far fewer smartphones in the first quarter of this year than had been expected following its acquisition of Motorola Mobility and a rebirth of interest in that brand.
Ships may be as low as 8-9 million, down from 15 million the previous quarter due in part to inventory, Digitimes reports.
In February, Motorola rolled out a less expensive smartphone, targeting first-time buyers.
Competition from low-cost providers such as Xiamoi has increased pressure on Lenovo in China and other emerging markets. Lenovo also recently reintroduced Motorola phones in China while expanding its own product lineup.
However, Digitimes says the 15-million expectation won’t be met “due to high inventories left over from the previous quarter as well as its marketing strategy and pricing for Lenovo- and Motorola-brand products.”
“Lenovo managed to ship 15 million smartphones in the fourth quarter of 2014 thanks to increasing shipments of 4G models. It was expected to maintain its shipment momentum by shipping over 10 million units in the first quarter of 2015,” the company reported.
One big problem, Digitimes adds, is a change in subsidiary policies in China – Lenovo’s biggest market for PCs and phones. Subsidies help bring down phone costs.
The report does note one big positive for Lenovo: Motorola smartphones in the U.S. “have been steady recently, and the introduction of some entry-level models in emerging markets including India, Latin America and China has been successful.”
Lenovo closed on the buy of Motorola Mobility from Google last fall.
