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Restructuring and consumer demand drive profits at Chinese vendor

Lenovo sees huge Q3 growth

Lenovo said on Thursday that its profit during the third quarter rose 178 per cent, thanks partly to restructuring and it increasing its share within the consumer channel.

It said that its earnings for the quarter were $105.3 million, up from $37.9 million in 2006. Revenue also saw an increase, up by 20 per cent to $4.4 billion over the same time last year.

Lenovo said that its use of the IBM brand in the business sector had served it well, but that the majority of its current growth had come, and will come in the future, from the consumer side of the business.

"We are very happy with our consistent growth," said Lenovo’s chairman, Yang Yuanqing (pictured) at a press conference in Hong Kong. "Lenovo is no longer just a company within the Chinese market, it is a worldwide company."

The company also announced that it would discontinue the licensing of the IBM brand from next year as it continues to focus on building up the Lenovo brand, especially in the build up to the 2008 Bejing summer Olympics, which Lenovo is primary sponsor of.

Yuanqing also said that the company’s growth was outpacing the rest of the industry, with its shipments rising by 23 per cent.

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