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Lenovo Makes A Loss After US$400m Tax Hit

For its Q3 financial results, Lenovo had mostly disappointing results as the personal computer company was hit with a US$400m tax bill for the recent US tax reform legislation.

The company reported a profit loss of US$289m for Q3, however its revenue rose from US$12.1bn to US$12.9bn.

Lenovo is also recording a loss for its Mobile Business Group which was down 5 per cent to US$2.1bn compared to the prior year but flat in Q2. Lenovo credits the loss to “competitive challenges.”

Yang Yuanqing, Lenovo Chairman and CEO says, “Lenovo is accelerating its transformation to become a world leader across every part of our business. We continue to see significant improvement and strong performance in some of the most exciting technology market sectors, smart devices and data center.

“We saw revenue, margins, profit, innovation, performance and customer experience all extend the momentum that developed during the prior quarter, and these results reaffirm the transformation strategy we are executing.”

For its PC and Smart Devices group, it shipped 15.7 million PC units, which is flat for its year-over-year. Revenue grew 7.6 per cent compared to last year’s Q3 to US$9.3 billion, and up 10.4 percent from the prior quarter, which what the company says is its the 5th consecutive quarter of year-to-year revenue growth.

Its operating expenses also grew from US$1.4bn to US$1.5bn.

Right now Lenovo’s shares are worth HKD4.41 a 2.22 per cent loss.

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