Lenovo Group reported a 21% fall in third-quarter profit on Thursday, even as revenue rose to its highest level on record, helped by strong growth across its businesses.
Net profit attributable to shareholders dropped to $546 million for the three months ended December 31. That figure was still above market expectations, with analysts surveyed by LSEG forecasting an average of $451.29 million.
When one-off items and non-cash charges were excluded, adjusted net profit rose 36% to $589 million, pointing to stronger underlying performance despite pressure on margins.
Revenue for the quarter climbed 18% year-on-year to $22.2 billion, with all of Lenovo’s business groups recording double-digit growth. The company said this was its highest quarterly revenue to date.
Profit margin improved to 2.7%, although restructuring costs continued to weigh on reported earnings.
Growth in artificial intelligence-related products and services was a key driver. Lenovo said AI-related revenue surged 72% from a year earlier and now accounts for 32% of total revenue. This includes AI devices, infrastructure and services.
The company’s Intelligent Devices Group, which houses its personal computer business, posted revenue of $15.8 billion, up 14% year-on-year. Lenovo’s global PC market share rose to a record 24.9% during the quarter.
Lenovo also disclosed that its Infrastructure Solutions Group took $285 million in restructuring charges. The restructuring plan is expected to deliver annual cost savings of $200 million over the next three years.
The company said it continues to push its hybrid AI strategy, including the rollout of its “Lenovo Qira” super agent and deeper collaboration with Nvidia, as it seeks to drive long-term growth across hardware and AI-led services.
