Lenovo Raises PC Shipments Outlook for 2025 After Sturdy Earnings

Lenovo Group Ltd. hiked its projection for international PC shipments in 2025 after posting better-than-expected earnings, saying AI options will assist enhance progress subsequent yr.

The general PC market will develop within the present quarter, Lenovo’s Chief Govt Officer Yang Yuanqing informed Bloomberg Information after earnings on Friday. He raised his outlook for international shipments in 2025 to double-digit proportion progress, up from a earlier forecast of 5 p.c to 10 p.c, citing demand for AI PCs and the substitute cycle facilitated by Home windows 11. 

Yang added that Lenovo shouldn’t be notably deprived towards its key opponents if US President-elect Donald Trump decides to slap tariffs on international items after formally returning to the White Home. 

Web earnings grew 44 p.c to $358.5 million (roughly Rs. 3,027 crore) within the September quarter, Beijing-based Lenovo mentioned in a submitting on Friday. That compares with a median estimate of $343.3 million (roughly Rs. 2,899 crore). Income rose 24 p.c to $17.85 billion (roughly Rs. 1,50,738 crore), additionally exceeding analyst projections. 

The corporate’s quarterly PC shipments climbed three p.c from a yr in the past, in keeping with business researcher IDC, whereas rivals like Dell Applied sciences Inc. and Apple Inc. noticed declines. “The market is taking a breather earlier than going into the year-end shopping for interval,” mentioned Bryan Ma, vice chairman at IDC.

PC makers are making an enormous push this yr so as to add synthetic intelligence capabilities — with a serving to hand from Home windows maker Microsoft Corp. — in a bid to entice shoppers into an improve cycle. Because the business bounces again from the troughs of latest years, the reception to this new crop of AI PCs might be essential to future success. The mass market’s curiosity for such gadgets, which have increased value tags, nonetheless stays to be examined. 

Lenovo’s AI wager shouldn’t be restricted to end-user gadgets. The corporate’s infrastructure options group, which sells servers to large-scale clients, is one other key pillar of its funding into the nascent expertise. Lenovo sees that division powering progress by delivering knowledge heart {hardware} that helps speed up AI mannequin coaching and computations. 

“Lenovo’s knowledge heart phase may develop considerably on AI server order wins and enhancing provide of Nvidia’s GPUs, although profitability might stay subdued”, Bloomberg Intelligence analysts Steven Tseng and Sean Chen wrote in a report forward of the earnings launch.

© 2024 Bloomberg L.P.

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