February 08, 2012, 9:37 PM — Lenovo's profit in its fiscal third quarter ended Dec. 31 grew 54 percent year-over-year, as the company saw growth in many key markets.
PC shipments increased by 37 percent, the Chinese PC vendor reported on Thursday.
Profit was US$153 million at the end of the quarter, while revenue rose by 44 percent year-over-year to $8.4 billion.
Lenovo's business continues to grow despite a sluggish PC market brought on by uncertain economic conditions, and consumer interest in tablets. The company was rated by research firms Gartner and IDC as the world's second largest PC vendor, surpassing Dell, in the third quarter of 2011.
Lenovo has credited its success to its focus on strengthening its PC business in its home turf in China -- expected to be the world's largest PC market in 2012 -- while also "attacking" emerging markets such as Russia and India. In China, the company said it now had a record 35.3 percent market share.
"In China, you only have to walk around a few blocks and you will be able to find a Lenovo store or service center," said Gartner analyst Eileen He. The company continues to invest in distribution channels not only in China, but also in foreign markets, which helped drive Lenovo's growth, she added.
Lenovo also reported growth in mature markets. The company said its PC shipments in Western Europe and North America increased by 67 percent year-over-year during the quarter.
In its mobile Internet business, which includes tablets and smartphones, Lenovo reported "strong progress". In the fiscal third quarter, the company sold 6.5 million handsets, of which almost half were smartphones.
In the past, the company's mobile phones have only been available in China. Lenovo plans to begin selling smartphones in other emerging markets, said the company's CEO Yang Yuanqing on Thursday during a conference call. He did not specify which countries.
Lenovo also plans to release its first smart TV in China this April. The company will use the product to test the market. "We don't have too high expectation on the sales volume," Yang said.
Its K91 Smart TV can run Android 4.0 applications, and includes voice control. But the company hasn't said so far if the device, which will ship with two different screen sizes - 42-inch and 55-inch, will be introduced in other markets like the U.S.
