Motorola Finally Makes Money, After Being Bought By Lenovo 5 Years Ago

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Lenovo knew that buying Motorola was no get rich quick scheme, and the latest quarterly report shows the company’s finances setting all-time records in some departments, indicating that the Moto buyup and the strategy shift that took place not long after are paying off. The most drastic change in the report is a total net income of $233 million, flipping the script on the net loss of $289 million that gave investors pause at the same time last year.

Part of that massive upswing is an actual net profit in the mobile department, the company’s very first one since acquiring Motorola from Google back in 2014. Mobile revenue in the company’s homeland quadrupled year on year, while American numbers went as far as outgrowing the market by 40% for the quarter.

Lenovo scaled back its mobile portfolio worldwide to focus on core markets and demographics, axing product lines that weren’t making the cut and slimming down operations elsewhere. While it could be argued that there is still some fat to trim, a refocused Motorola did fairly well in the US during the quarter. That’s due in part to the popular but aging Moto X4 making its way onto Google’s Project Fi. Other Moto phones, particularly budget models like the Moto E and G lineups, sold quite well both unlocked and with prepaid carrier customers. Lenovo’s own brand, meanwhile, had no trouble putting up good numbers in its homeland.

Outside of the mobile space, the bulk of Lenovo’s profit for the quarter came from its PC and Smart Devices business, which reported total revenue of $10.7 billion. Lenovo’s position as the dominant PC maker no doubt helped with that number, especially since its Yoga and IdeaPad families have many levels of the consumer market covered. The ThinkPad brand that IBM has trusted it with for close to 15 years now, meanwhile, continues to garner rave reviews and dominate the business landscape, while also enjoying the same marginal-yet-substantial enthusiast and hobbyist sales that the brand has boasted since the 90s.


Lenovo’s adventures outside of the PC and mobile worlds include a range of smart home and office gear, as well as AR and VR gear that managed to gain some degree of traction recently. Taken altogether, it’s easy to dismiss everything as Lenovo’s other ventures being carried along by excellent PC sales, but it’s really not that simple; the company has been working through the motions of a delicate balancing act for the past few years, and that approach is now beginning to seriously pay off.

Going forward, it’s anybody’s guess as to whether Lenovo can keep up the momentum in the mobile world. The Moto Z lineup has grown stale for many, with the Moto Mod ecosystem falling flat and the quirky, rugged Moto Z2 Force left without a true sequel. Lenovo’s self-branded phones, meanwhile, rarely do well in the US, forcing them to perform even better in other markets to make up the difference. A teased Moto Razr revival powered by a foldable screen may put the spark back in Lenovo’s mobile business, but until then, it’s likely to be business as usual with a big chunk of its revenue coming from the budget world.

Outside of smartphones, Lenovo is getting bolder and more innovative in recent years. Its AR Star Wars kit is only one piece of proof of that, alongside AMD Ryzen-powered ThinkPads, and a wider range of Yoga laptops than ever to cover just about every segment of the market. Overall, if things keep up as they are, the future looks bright for Lenovo. It just has to figure out how to keep its current momentum going strong.