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Lenovo Posts $300 Million Net Profit for Q4 2015

February 3, 2016 - Written By Daniel Fuller

After a long while out of profitability, Lenovo is back in the black for Q4 of 2015, or Q3 of their 2015 fiscal year. Total revenue found itself in decrease again, landing at $12.9 billion this year, down 8 percent from last year. Despite this, the company managed to get back into profitability after completing the restructuring that took place after buying up Motorola. After taxes and other considerations, the  gross profit for the quarter was $1.9 billion, leading to a net profit for the quarter of $300 million. This means that they met the goal they had set for going back to profitability in the mobile space within 4 to 6 quarters of sealing the deal with Motorola. Their strong PC sales, totaling $8 billion and grabbing an incredible 21.6 percent of the PC market, helped substantially in putting them back on track for the end of the year. Additionally, money-saving actions announced back in August of 2015 are on track to save Lenovo roughly $1.35 billion in 2016. 

Chairman and CEO Yuanqing Yang explained the company’s comeback, saying, “Last quarter, although we were impacted by the global macro-economic slowdown, currency fluctuations in key markets, and PC market decline, Lenovo still achieved record high profit and delivered on our commitment to turn around the Mobile business,”. On future plans, he shifted the focus to PC and mobile, saying, “Next, in PCs, we will leverage the consolidation trend, commercial PC replacement, and opportunities in innovative product categories to drive growth. In Mobile, we will build scale and efficiency to accelerate our growth in emerging markets, breakthrough in mature markets with innovative products and premium brands, and expand in the open market in China with a stronger product portfolio. And finally, in Enterprise, we will leverage leading technologies and strategic partnerships to drive profitable growth.”

Total gross sales globally saw a drop, with some markets plunging as much as 15 percent. Despite this, sales figures were relatively strong and, combined with moves meant to save money and fairly high margins, managed to get Lenovo back into profitability after a long period in the red. Projected figures show a brighter future, though it’s too early to begin predicting complex figures like 2016 net profit. Overall, with many of the costly elements of the Motorola purchase out of the way, Lenovo is looking fit to resume business as usual in 2016 and go back to steady profits.