Lenovo profit jumps 36 per cent as smartphone, tablet sales double

Lenovo Group, the biggest personal computer maker, has reported a 36 per cent jump in its quarterly profit as sales of smartphones and tablet computers more than doubled.

It earned $220 million, or $2.12 per share, in the three months ending September 30, the company announced on Thursday. Revenue rose 13 per cent from a year earlier to $9.8 billion.

The results reflect the dramatic shift underway as people switch to going online wirelessly and manufacturers that got the bulk of revenues from desktop PCs scramble to keep up.

Lenovo said its sales of smartphones, tablet computers and other mobile devices rose 106 per cent over a year earlier to $1.5 billion. Mobile's share of revenue expanded to 15 per cent from the previous quarter's 9 per cent.

Sales of traditional desktop PCs fell 3 per cent to $2.7 billion while laptop sales rose 8 per cent to $5 billion.

"We are optimistic about the industry's outlook," said chairman Yang Yuanqing in an earnings announcement. "The PC market is recovering and tablet growth continues shifting to mainstream and entry-level segments, as well as emerging markets. These are Lenovo's strength areas," he said. "We are confident that we will capture these opportunities and continue our strong growth."

Lenovo, which is based in Beijing and in Research Triangle Park, North Carolina, has said it expects mobile devices to become the bulk of its business in coming years.

In its home China market, Lenovo's revenue rose just 1 per cent to $3.8 billion, reflecting a steady decline in economic growth. It said smartphone and tablet sales in China rose 45 per cent.

Lenovo was declared the No. 1 personal computer maker in the previous quarter by research firms Gartner and IDC, finally surpassing rival Hewlett Packard Co. But that success was tempered by data that show sales of desktop computers steadily declining.