Lenovo’s mobile business recorded double-digit revenue growth in fiscal Q3 (ending 31 December 2020) and its highest profitability since acquiring the Motorola business, as strong 5G device sales boosted ASPs.
In a statement, the company explained Mobile Business Group (MBG) revenue jumped 10.1 per cent year-on-year to $1.52 billion, with pre-tax profit increasing from $3 million to $10 million despite higher freight and logistics costs, and industry-wide component shortages.
The company continued to expand its smartphone mix towards higher-end models and build relationships with mobile operators, with ASPs up 19 per cent on premium and flagship sales. Revenue from 5G models accounted for 13 per cent of the group’s total.
A solid performance in Latin America and North America underpinned rapid expansion in Europe and Asia, the company noted.
MBG is part of Lenovo’s Intelligent Devices Group and accounted for 8.8 per cent of total revenue, down from 9.8 per cent in the same quarter in 2019.
Lenovo’s net profit increased 53 per cent to $395 million, and revenue rose 22 per cent to $17.2 billion.
Chairman and CEO Yuanqing Yang said: “Clearly, 2020 was a challenging year that brought remarkable changes to our world”, adding Lenovo plans further investments in “technology and innovation”, driving “intelligent transformation across industries and create sustainable growth”.
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