The world’s largest personal-computer maker, Lenovo Group who have gone very quiet in Australia especially when it comes to reviews and the launch of new products, was caught off guard by abrupt U.S. tariff increases on Chinese goods claims executives.

Despite this the world’s #1 PC brand that is moving production to Vietnam remains confident in its ability to adapt, Chief Executive Yang Yuanqing said last night.

“The challenge is not the tariff itself, it’s the uncertainty,” Yang noted in an interview, highlighting how sudden policy shifts can disrupt business strategies. In March, the U.S. unexpectedly raised tariffs on Chinese imports from 10% to 20%, forcing Lenovo to absorb an estimated $15 million in additional costs.

Despite the financial setback, Yang emphasized Lenovo’s ability to navigate tariff shifts more effectively than its competitors. With manufacturing operations spread across 11 countries, the company benefits from a diversified production strategy that enhances resilience in uncertain economic conditions.

While tariff hikes have strained trade relations between Washington and Beijing, recent negotiations have led to temporary reductions in duties. Nevertheless, Lenovo is preparing to move production for U.S.-bound PCs from China to Vietnam by the end of June, analysts say.

Yang clarified that Lenovo is not abandoning China, citing the country’s cost advantages and manufacturing efficiency. “The more diversified you are, the more resilient you are,” he said.

Despite ongoing trade uncertainties, Lenovo remains optimistic about its growth trajectory. The company reported one of its strongest fiscal years yet, with revenue and profit rising overall, despite a slight decline in quarterly earnings.

To maintain profitability, Lenovo may need to pass some of its increased costs on to consumers, Morningstar analyst Kazunori Ito warned. However, the company’s expansion into artificial intelligence could provide a competitive edge. Sales of Lenovo’s AI-powered computers grew in the latest quarter, and Yang expects them to account for 25% of the company’s global PC shipments this year.

As Lenovo continues to navigate trade tensions and shifting policies, Yang expressed confidence in the company’s ability to maintain strong growth. “We are in a good position to tackle tariff headwinds,” he said.