Could 23, 2024– Lenovo Group (HKSE: 992) (ADR: LNVGY) as we speak introduced This fall and full-year outcomes for fiscal 12 months 2023/24. After resuming progress in Q3, the Group reported year-on-year income progress throughout all enterprise teams in This fall, with Group income rising practically 10% year-on-year to US$13.8 billion, web revenue doubling year-on-year to US$248 million, and non-PC income combine reaching a historic excessive of 45%. The Group’s This fall and total 2nd half efficiency demonstrates how Lenovo has navigated the previous 12 months’s business downturn, captured the super progress alternatives offered by AI, and accelerated momentum throughout the enterprise. Income for the complete fiscal 12 months was US$56.9 billion, and web revenue was US$1 billion. From the second half of the fiscal 12 months, Lenovo achieved year-on-year income progress of 6% and web margin recovered from a primary half year-on-year decline to flat within the second half.
The Group is main in an period of unprecedented AI alternatives with its pocket-to-cloud portfolio, robust ecosystem and partnerships, and full-stack AI capabilities. Since asserting its AI technique in October 2023 at its annual Tech World occasion, Lenovo has launched its first wave of AI PCs in addition to AI capabilities protecting different good gadgets, good infrastructure, and good options and providers. The Group expects the AI PC – which is outlined as outfitted with a private AI agent based mostly on pure interactions, heterogeneous computing, private data base, linked to an open AI utility ecosystem, and with privateness and safety safety – to develop from its present premium place to mainstream over the following three years, driving a brand new refresh cycle for the business. Hybrid AI can be driving better demand for AI infrastructure and clients are more and more asking for personalized AI options and providers, notably consulting, design, deployment and upkeep of AI.
Lenovo’s continued dedication and funding in innovation, centered on its anchor applied sciences of AI and computing, helps it notice its imaginative and prescient of ‘Smarter AI for All’ and additional lead within the AI period. Up to now fiscal 12 months, the Group achieved a document excessive share for each R&D headcount at 26.2%, in addition to a R&D expense to income ratio of three.6%.
Wanting forward, the Group is inspired by its efficiency and momentum within the 2nd half of the fiscal 12 months and is optimistic in regards to the outlook for the 12 months forward the place it’s going to proceed to steer in AI, spend money on innovation, and seize on the unprecedented alternatives offered by hybrid AI because it accelerates progress and sustainable profitability will increase throughout its whole enterprise.
Lenovo’s Board of Administrators declared a closing dividend of three.8 US cents or 30.0 HK cents per share for the fiscal 12 months ended March 31, 2024.
Chairman and CEO quote – Yuanqing Yang:
“Lenovo’s fourth quarter outcomes clearly show that we have now not solely resumed progress throughout all our companies however that our enterprise momentum is accelerating, pushed by the unprecedented alternatives introduced by Hybrid AI. Fueled by our clever transformation technique and years of funding in innovation, we’ve constructed a full stack of AI capabilities and are on the forefront of pioneering the revolutionary AI PC market. Our imaginative and prescient within the AI period is Smarter AI for All. Supported by our robust execution, persistent innovation, operational excellence, and ecosystem partnerships, we’re assured we will ship sustainable progress and profitability enchancment within the coming 12 months.”
Monetary Highlights:
Options and Companies Group (SSG): Sturdy progress and profitability, driving AI options
This fall and full 12 months FY23/24 efficiency:
- Strengthened SSG’s place as a progress engine and revenue contributor by delivering greater than 10 % year-on-year income progress to US$1.8 billion, and excessive profitability with an working margin exceeding 21% – double-digit income progress and working margin for 12 consecutive quarters. Income for the complete fiscal 12 months was US$7.5 billion, rising at 12% year-on-year and an working margin of practically 21%.
- Managed Companies and Challenge and Options Companies income combine grew 5 factors year-on-year, now accounting for 55% of SSG’s complete enterprise for the quarter.
- Hero choices resembling Digital Office Options and TruScale for Hybrid Cloud have each delivered fast progress.
Alternatives and Sustainable Progress:
- Wanting forward, SSG will proceed to fulfill the rising buyer demand by shifting quick to construct AI-native and AI-embedded options and providers.
- The Care of One platform, Cyber Resiliency as a Service and the decisioning instrument Lenovo Clever Sustainability Options Advisor (LISSA) use the ability of AI to ship hyper-personalized worker experiences, elevated productiveness, enhanced safety and sustainable IT selections.
Infrastructure Options Group (ISG): Regained momentum
This fall and full 12 months FY23/24 efficiency:
- This fall income resumed progress, with double-digit year-on-year progress of 15%, taking ISG’s income for the quarter to US$2.5 billion – a brand new document excessive for a fourth quarter.
- Storage, software program and providers companies all achieved hypergrowth, with the mixed income rising greater than 50% year-on-year. Excessive Efficiency Computing income hit a document excessive.
- For the complete 12 months ISG achieved quarter-on-quarter income progress for 3 consecutive quarters and achieved its second highest ever fiscal 12 months income.
Alternatives and Sustainable Progress:
- AI servers are anticipated to develop practically twice as quick because the broad server market because the market shifts to AI infrastructure.
- ISG will broaden its portfolio and convert its pipeline to seize new alternatives, in addition to leveraging its strengths in conventional servers, edge, storage, software program and providers to seize progress and resume profitability.
Clever Gadgets Group (IDG): Strong progress, strengthened management
This fall and full 12 months FY23/24 efficiency:
- IDG continued to ship a strong quarter, strengthening its world market management for PCs with a market share of twenty-two.9%, a major premium to the market, and business main profitability. Income for the quarter was US$10.5 billion, and for the complete 12 months was US$44.6 billion.
- The PC enterprise was no. 1 in 4 out of 5 geographies, attaining document excessive market share in North America.
- The smartphone enterprise delivered outstanding progress, rising double digits in each shipments and income year-on-year, with substantial premium to the market.
- IDG’s profitability for the complete 12 months was resilient, despite a weaker than anticipated market within the first half of the fiscal 12 months. PCs, tablets, and smartphones all resumed progress within the second half of the fiscal 12 months.
Alternatives and Sustainable Progress:
- Wanting forward, the amount of PC market is predicted to recuperate to pre-Covid ranges, with smartphone already having returned to double-digit year-on-year hypergrowth.
- AI PCs will step by step develop from premium to mainstream over the following three years as Lenovo has shipped its first wave of AI PCs and extra will ship within the coming quarters, driving a brand new refresh cycle within the PC market.
- Increasing AI from PCs to telephones and tablets, constructing seamless collaboration between gadgets with Sensible Join software program resolution.
ESG and company highlights
Achievements, bulletins, and notable commitments over the previous quarter embrace:
- Lenovo has been acknowledged for its management in local weather change and provider engagement by the worldwide setting non-profit CDP. This management rating acknowledged Lenovo for its efforts in implementing present greatest practices towards local weather change and proactively working with its suppliers towards a extra sustainable future.
- The Group was additionally awarded ‘Finest Worth Chain Initiative’, ‘Finest Inexperienced Product’, and acquired a recognition of ‘extremely recommended’ within the class of ‘Round Economic system Firm of the 12 months’ on the world CRN Sustainability Tech Summit.
- In February, Lenovo joined UNESCO’s dedication for accountable AI, which asks corporations to use well timed measures to ‘forestall, mitigate, or treatment’ potential opposed impact of AI. This dedication is along with Lenovo’s personal inner accountable AI committee, a governance framework that covers moral, authorized, security, privateness and accountability for any AI merchandise, providers, and options.
[1] non-HKFRS measure was adjusted by excluding web honest worth modifications on monetary belongings at honest worth via revenue or loss, amortization of intangible belongings ensuing from mergers and acquisitions, mergers and acquisitions associated expenses, restructuring and different expenses, acquire on remeasurement of a written put choice legal responsibility; and the corresponding revenue tax results, if any.
About Lenovo
Lenovo is a US$57 billion income world expertise powerhouse, ranked #217 within the Fortune International 500, and serving thousands and thousands of shoppers each day in 180 markets. Centered on a daring imaginative and prescient to ship Smarter Know-how for All, Lenovo has constructed on its success because the world’s largest PC firm with a pocket-to cloud portfolio of AI-enabled, AI-ready, and AI-optimized gadgets (PCs, workstations, smartphones, tablets), infrastructure (knowledge heart, storage, edge, excessive efficiency computing and software program outlined infrastructure), software program, options, and providers. Lenovo’s continued funding in world-changing innovation is constructing a extra equitable, reliable, and smarter future for everybody, in every single place. Lenovo is listed on the Hong Kong inventory alternate beneath Lenovo Group Restricted (HKSE: 992) (ADR: LNVGY). To search out out extra go to https://www.lenovo.com, and browse in regards to the newest information through our StoryHub.
