Lack of demand for personal computers meant Lenovo turned in a first quarter net loss of $16.01 million compared to a profit of $110.5 million in the same period a year before.
Lenovo chairman Liu Chuanzhj said: “There was little doubt that this year was going to be a challenge to our industry.” He said: “With the global economic environment still unstable, we will continue to extend our leadership in China, strive to restore profitability in mature markets, and also seize opportunities in emerging markets and the transactional space.”
The Chinese market accounted for $1.7 billion of Lenovo sales in its first financial quarter and represented 48 percent of the company’s worldwide sales. Shipments in China grew by 15 percent year on year.
Sales in what Lenovo defines as emerging markets represented 14 percent of sales worldwide, and turned in revenues of $474 million. But shipments fell by six percent ear on year. It failed to increase its share of the consumer market in this region.
The mature markets – that is to say Western Europe and North America, accounted for $1.3 billion of sales – 38 percent of Lenovo worldwide sales. Its shipments fell by 17 percent quarter on quarter, year on year.
Lenovo bought IBM’s Thinkpad business in 2005, and notebooks continue to be the major revenue generator for the company – sales of notebooks represent 64 percent of its total sales revenue. Sales of notebooks in the financial quarter amounted to $2.2 billion, a fall of nine percent year on year.