Lenovo’s annual profit rose 29 percent to a record high as smartphone sales surged in China and other markets.
For the fourth consecutive quarter, Lenovo sold more smartphones and tablets combined than PCs.
Overall sales in the Americas grew by nearly a third to $8.2 billion even though Lenovo smartphones are not yet available in North America.
For the fiscal year, Lenovo’s revenues reached $9.4 billion, $400 million more than 21 analysts expected, according to Bloomberg news.
However, quarterly net income of $158.3 million was $5 million shy of expectations, Bloomberg reported.
Still, Lenovo Chairman and CEO Yang Yuanqing praised the results.
In a conference call with analysts, he also set out higher goals for growth in smartphones and tablets. Yang wants to sell 100 million smartphones and tablets combined this year and become the No. 1 tablet manufacturer within two years, Reuters reported Yang as saying.
“The record sales and profits that we delivered last year prove that Lenovo can grow and deliver its commitments, no matter the market conditions,” Yang said in a statement.
“Not only did we strengthen our leading position in PCs, but we gained three points in tablets by quadrupling sales volume and became the fastest growing major smartphone company in the world. This demonstrates our capability to manage both businesses that are already mature, as well as those that are shifting to maturity. Meanwhile, we are building new engines for growth in the enterprise and ecosystem. Through the combination of our existing and new businesses, Lenovo offers tremendous value to shareholders today, and our value will be even greater in the future.”
The world’s No. 1 PC manufacturer said early Wednesday that smartphone shipments during the year jumped by nearly three-quarters to 50 million on strong demand in China, Southeast Asia and Eastern Europe, almost matching the 55 million PCs sold in the same period.
The company has been expanding aggressively into mobile technology as the traditional PC market cools and consumers increasingly go online using phones and tablets.
Lenovo is in the process of acquiring Google’s Motorola Mobility smartphone business, which it agreed to buy for $2.9 billion in January. The deal has yet to receive approval from regulators.
Lenovo, based in Beijing and Morrisville, reported profit for the year ended March 31 of $817 million or 7.88 cents a share. Revenue grew 14 percent to $38.7 billion.
Revenue at its smartphone division nearly doubled to $5.7 billion as deliveries in China grew by about half to 44 million and shipments in markets outside of China jumped 11-fold to 6 million. Tablet sales quadrupled to 9.2 million.
The company said it was the world’s fourth biggest smartphone maker, with global market share edging up to 4.6 percent
Laptop sales rose 10 percent to $17.9 billion while desktop computer sales edged up 5 percent to $11 billion.
Sales in China, its biggest market, were flat at $14.7 billion. Sales in the Asia-Pacific region overall grew 12 percent to $6.2 billion and in Europe, Middle East and Africa they were up 27 percent to $9.6 billion.