Lenovo PC sales surpass HP

Lenovo boosted second-quarter profit 13 per cent as it expanded market share to overtake Hewlett-Packard in personal-computer shipments.

Net income climbed to $162 million (€126.8 million) in the three months to September 30 from $143.9 million a year earlier, Lenovo said in a statement today.

Chief executive officer Yang Yuanqing achieved his goal of building the Chinese company into the world's largest PC maker last quarter as it accounted for 15.7 percent of global PC shipments, overtaking Hewlett-Packard's 15.5 per cent, market-research firm Gartner said last month.

The company's unit that makes mobile devices almost tripled sales through the first six months of this year.

"We're positive on their development in smartphones," Christine Wang, a Taipei-based analyst at Daiwa Capital Markets, said by phone today.

"Lenovo will outperform the PC industry, but it's still slowing down. So if the company can deliver performance on the smartphone side, that is pretty good."

Revenue at Lenovo, whose headquarters are in Beijing and North Carolina, rose 11 per cent to $8.67 billion from $7.79 billion.

Lenovo's shares pared declines in Hong Kong trading and were down 1.9 per cent at HK$6.63 as of 2.03pm, after falling as much as 3.9 per cent prior to the announcement.

The stock has climbed 28 per cent this year, surpassing the 18 per cent gain for the city's benchmark Hang Seng Index.

Lenovo, which bought the PC division of International Business Machines in 2005, used acquisitions to help boost sales in the past year.

The company bought control of Medion, a German-based computer maker, and the PC unit of Tokyo-based NEC in 2011.

The PC maker is stepping up development of smartphones, tablets and Internet-ready televisions to widen its product line for consumers, following Apple and Samsung. The company's mobile Internet and digital home unit that makes smartphones boosted sales to $1.31 billion during the first six months of 2012 from $496.7 million a year earlier.

Revenue from China, Lenovo's biggest market, rose 22 per cent to $7.34 billion in the first six months, making up 44 per cent of the total.

Sales in North America climbed 7.1 per cent to $2.41 billion, comprising about 15 percent of global revenue for the period.

In Europe, the Middle East and Africa, sales gained 31 per cent to $3.38 billion, or 20 per cent of the total.

Bloomberg