Lenovo Outlines Company Transformation Strategy - From Devices To Solutions Company
Lenovo's annual global employee event revealed its transformative plans to evolve from a global devices company into a leader in technology solutions. CEO Yang Yuanqing highlighted unprecedented growth, with revenue increasing by 12% and pre-tax profit up 48% year-over-year during the first three quarters of FY2020. Lenovo's share price has doubled, reflecting strong execution. Key strategies include enhancing device proliferation, expanding end-to-end infrastructure, and leveraging AI for intelligent transformation. Lenovo aims to dominate PC market share and achieve mobile profitability with upcoming 5G innovations.
- Revenue increased by 12% and pre-tax profit rose by 48% year-over-year.
- Share price has doubled year-over-year, signaling strong market confidence.
- Lenovo holds number one global PC and tablet market share.
- Services, software, and solutions revenue grew by nearly 38% year-over-year.
- None.
Today, during its annual global employee kickoff event broadcast to 63,000 employees, Lenovo unveiled its plans to drive transformation from a global devices company to a technology leader in global devices + solutions, services, and software. Lenovo CEO Yang Yuanqing and other executive leaders outlined the company’s strategy, structure, and goals that will fuel Lenovo’s next decade of growth and position it as one of the world’s most trusted and iconic technology leaders, delivering smarter technology for all.
“Last year at this time, none of us knew how things would turn out for Lenovo,” said Lenovo CEO Yuanqing Yang. “But we did know this: we would support each other in an unpredictable journey ahead; we would fight for the best possible outcome in an uncertain world; and we would use our technology to connect and heal a wounded society.”
During the past year the COVID pandemic drove many businesses and consumers around the world to adopt and use technology innovations in new ways, from remote learning to treating patients to pivoting their business models. They counted on Lenovo’s unique ability to provide the devices and solutions they needed to survive and thrive in this challenging environment. Lenovo’s committed, diverse global workforce ensured the company met the global need for technology solutions being the first to resume manufacturing after facilities closed early on in the pandemic, building a new factory in 47 days, and launching an impactful charitable donation effort.
Unparalleled Growth for Company’s Fourth Transformation
Lenovo’s operational and workforce resilience has led to significant growth across all areas of the business, the doubling of the company’s share price year over year, and has positioned Lenovo for its fourth transformation during its 35 year history into a broader technology leader that combines devices + services + software + solutions.
“Our share price has doubled,” Yang said. “This not only shows our outstanding execution, but also that the market views Lenovo as a resilient, winning company. We were a strong team before the pandemic, and an even stronger team after.”
Recent performance highlights include:
-
For the first three quarters of FY2020, revenue grew
12% and pre-tax profit increased48% year over year. - Lenovo remains the undisputed number one globally in PC and tablet market share, hitting historic highs.
- Mobile achieved double-digit revenue growth year-over-year in FYQ3.
- Revenue in the data center business grew by double digits year-over-year, significantly outperforming the market for four consecutive quarters.
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Services, software, and solutions grew almost
38% year-over-year in FYQ3, now accounting for ~8% of the company’s total revenue. - Lenovo Capital Investment Group contributed financially and strategically through seven IPOs and reached record high investment gains.
Further, Lenovo plans an additional listing on the Shanghai stock exchange, broadening investor access and unlocking greater value. This growth happens in tandem with Lenovo’s strong commitment to sustainability, as seen through a 92 percent reduction in scope 1 and scope 2 greenhouse gas emissions. Lenovo also remains committed to environmentally sound transformation, with ambitious science-based targets and identifying what it will take to reach net-zero emissions by 2050.
Unveiling New Strategy for Next Decade
Lenovo’s strategy for the next decade of growth leverages all of the strong “building blocks” the company has today and combines them into end to end solutions that align to the tech market trends and solve customer business problems in three ways:
- Device Proliferation: Whether it’s “one PC, tablet, or other device per person” more people need dedicated devices. Lenovo will offer a full range of devices for each segment, develop new form factors, incorporate 5G connectivity, explore extended reality, and offer new collaboration tools.
- End to End Infrastructure: Today customers want integrated solutions combining hardware with software, support, and expertise. Lenovo will continue to expand its offering of a broad range of infrastructure portfolios, from on-premises datacenters to private and public clouds, and edge to cloud solutions.
- AI-Supported Intelligent Transformation: Lenovo offers the foundational technology for emerging trends, including IoT, big data, algorithms, and Edge computing. Lenovo will combine hardware with services to create intelligent solutions in smart manufacturing, smart education, smart retail, and smart cities.
Effective April 1, 2021 Lenovo aligned its business groups around a new organizational structure focused on Smart IoT, Smart Infrastructure and Smart Verticals:
- Intelligent Devices Group (IDG), focused on Smart IoT
- Infrastructure Solutions Group (ISG), focused on Smart Infrastructure
- Solutions & Services Group (SSG), focused on Smart Verticals & Services
Announcing Ambitious Goals for a New Fiscal Year
Speaking to employees around the world, company Chairman and CEO Yang outlined ambitious goals to accelerate the company’s transformation over the next fiscal year, including:
- Become #1 in PC market share across large enterprise, small to medium business, and consumers
- Achieve mobile profitability in expanded markets fueled by 5G innovations
- Grow twice as fast as the company across the new Solutions and Services Group
- Achieve double-digit growth in the Infrastructure Solutions Group
“We have an exciting future, but it takes solid steps to get there on our intelligent transformation journey,” Yang said. “Be proud but not complacent. Be optimistic but stay resilient. Aim high but stay grounded.”
About Lenovo
Lenovo (HKSE: 992) (PINK SHEETS: LNVGY) is a US
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