Is Lenovo acquiring Motorola Mobility at just the right time?

Technology news site The Information reports that the Google smartphone division Lenovo is hoping to acquire for $2.9 billion is in the midst of a sales boom.

So is Lenovo about to strike gold again as it did when it bought IBM’s PC division almost a decade ago?

Could be.

The Information, a two-year-old news startup staffed by a team of veteran technology journalists, reports that sentiment about Motorola Mobility being a “lost cause” is changing as sales perk up.

In fact, reporter Amir Efrati says the group could be profitable by 2015.


Recent WRAL TechWire coverage of Lenovo:

  • Is IBM-Apple deal a slap in the face of Lenovo?
  • European Union OKs Motorola Mobility deal
  • N.C. in running for new Lenovo facility

LENOVO ARCHIVE: Check out nine of Lenovo stories as reported in WRAL TechWire.


The improvement comes despite turbulence caused by changes in Motorola Mobility management that occurred shortly after the Lenovo deal was announced. The company also announced the shut down of a plant in Texas where it builds smartphones.

Lenovo is hoping to close on the deal before the year is out and has already received regulatory approval in Europe, where Motorola has a sizable smartphone beachhead and Lenovo has virtually no phone presence. (See graphic with this post in which Lenovo notes Motorola’s reach and brand.)

“Motorola could double phone sales this year, according to internal projections,” Efrati reports.

“It’s also on track to hit profitability my the middle of next year, after losing $1.2 billion in 2013 alone. The turnaround could help position the combined Lenovo-Motorola as the leading global challenger to Samsung Electronics in selling phones based on Google’s Android operating software. It also holds valuable lessons for the many device makers that rely on Android and have struggled to gain ground.”

But there’s more.

Efrati also reports that Google is now working with its Motorola group on a “phone-table” project. Now that Google is selling the group, it appears the tech giant is willing to invest in Android device development that it had eschewed in the past due to other vendor concerns, Efrati reports. 

Financial news website SeekingAlpha says in its summary of The Information and other recent news about Motorola Mobility that the table project is called “Shamu.” 

SeekingAlpha says Motorola Mobility’s increasing sales also could be the result of selling cheaper phones rather than taking on deluxe iPhone and Samsung models. 

Lenovo has its own smartphones – a number that seems to increase daily – and is making huge progress in sales, especially in China. Combined with Motorola Mobility, Lenovo hopes to sell 80 million smartphones this year, as various media reports have said.

Motorola Mobility gives Lenovo a foothold in the U.S., another huge market where the world’s No. 1 PC maker and growing tablet manufacturer has yet to sell smartphones. 

The Information report can be read online. (Subscription required.)

Lenovo operates its global executive headquarters in Morrisville and also is seeking regulatory approval for a $2.3 billion acquisition of IBM’s x86 server business.