Lenovo Group Limited and its subsidiaries announced robust results for the third quarter of the fiscal year 2024/25, showcasing notable increases in revenue and net income.
The company reported a 20% year-on-year revenue growth, reaching US$18.8 billion, marking the third consecutive quarter of double-digit growth. Additionally, net income surged over 100%, rising to US$693 million, driven by a non-recurring income tax credit of US$282 million, based on Hong Kong Financial Reporting Standards (HKFRS).
This impressive performance reflects Lenovo’s diversified business strategy and focus on innovation. The company’s non-PC business now accounts for 46% of total revenue, up by more than four percentage points from the previous year. Lenovo’s success is largely attributed to its hybrid-AI strategy, the turnaround of its Infrastructure Solutions Group (ISG), and double-digit growth in both the Intelligent Devices Group (IDG) and Solutions and Services Group (SSG).
Lenovo is maintaining its commitment to cutting-edge research and development, with R&D expenses rising nearly 14% to US$621 million compared to the same period last year. The company unveiled several ground-breaking products at the CES 2025 technology event, including the world’s first rollable AI laptop, a handheld gaming device with the choice of either Windows OS or Steam OS, and the Moto AI platform, which has earned 185 industry awards.
Locally, Lenovo remains a dominant player in South Africa, where it holds the top market share in consumer notebooks and desktops, according to IDC. The company’s success is fuelled by its commitment to innovation and customer-centric solutions. In the broader Southern African Development Community (SADC) region, Lenovo commands a 34.4% market share across all segments.
Yugen Naidoo, Lenovo’s General Manager in South Africa, stated, “By integrating cutting-edge AI technologies and expanding our hybrid working portfolio, we empower users with smarter, more efficient tools that enhance productivity and connectivity. Our focus on democratizing AI and delivering innovative solutions ensures that all South Africans, from small businesses to large enterprises, can harness the power of technology to drive growth and success.”
Lenovo’s investment strategy is firmly focused on artificial intelligence (AI). The company is developing a foundational AI platform, enhancing agentic AI, and continuously evolving these technologies into market-ready products. Lenovo is a leader in personal AI with innovations in AI devices, while also investing heavily in hybrid infrastructure to support enterprise AI. This approach is positioned to capitalize on the increasing demand for AI, driven by the growing need for more efficient inferencing and lower computing costs. Lenovo’s hybrid AI strategy is designed to accelerate the development and deployment of both device and enterprise AI.
Lenovo is optimistic about sustaining its growth and profitability, thanks to its resilient global supply chain and strategic technology partnerships. The company has expanded its manufacturing presence in the Middle East through a partnership with Alat and forged important alliances with Formula 1® and FIFA. These strategic moves position Lenovo to navigate any potential macroeconomic challenges effectively.
Chairman and CEO Yuanqing Yang commented, “Lenovo’s revenue and profit both achieved significant growth last quarter, with strong performance across all core businesses. Notably, the ISG business returned to profitability and the smartphone business experienced rapid growth. The rise of AI technology is accelerating the maturation of personal AI, particularly on-device AI and edge AI, as well as driving enterprise adoption. This perfectly aligns with our hybrid AI strategy, positioning Lenovo for continued success.”
Financial Highlights:
For the third quarter of FY 2024/25, Lenovo achieved the following key financial results:
- Revenue: US$18.8 billion, up 20% year-on-year.
- Pre-tax Income: US$517 million, an increase of 10% from the prior year.
- Net Income: US$693 million, more than double the previous year.
- Earnings Per Share (EPS): 5.66 US cents, compared to 2.81 US cents in the same quarter last year.
Segment Performance:
- Intelligent Devices Group (IDG): IDG reported a 12% year-on-year revenue growth, reaching US$13.8 billion. The PC business strengthened its leadership position with a 24.3% market share, and the smartphone business experienced rapid growth, especially in Asia Pacific and EMEA markets. Looking forward, IDG plans to further innovate by converging powerful computing with more efficient models across various devices.
- Infrastructure Solutions Group (ISG): ISG saw a 60% increase in revenue, reaching US$3.9 billion. The segment achieved break-even profitability, driven by strong growth in cloud services and AI server business, particularly Lenovo Neptune liquid cooling solutions. ISG expects continued demand for hybrid infrastructure, particularly for AI-driven applications in both public and private cloud environments.
- Solutions and Services Group (SSG): SSG achieved record revenue of US$2.3 billion, with a 20% operating margin. This marks the 15th consecutive quarter of double-digit year-on-year growth. The group’s focus on AI-powered solutions and services contributed to its strong performance, and non-hardware solutions now account for nearly 60% of SSG’s revenue.
Lenovo’s commitment to sustainability and corporate responsibility was recognized with several prestigious awards. The company was named FIFA’s official technology partner, securing sponsorship for the upcoming FIFA World Cup 2026™ and the FIFA Women’s World Cup 2027™. Additionally, Lenovo was awarded the Gold Award for Most Sustainable Companies/Organizations by the Hong Kong Institute of Certified Public Accountants and achieved a Platinum rating from EcoVadis for its leadership in sustainability.
Main Image: Lenovo
