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The overall performance of the first half of the financial year was equally dazzling. Revenue reached 172 billion yuan ($25.3 billion), an increase of 16% over the same period last year; net profit reached 1.67 billion yuan ($245 million), an increase of 268% over the same period last year.
Among them, Intelligent Devices Group (IDG) has contributed the most prominent two performances: on the one hand, PC's revenue has broken through the $10 billion mark for the first time with 24% market share and 18% growth rate in the world, which is still an important pillar and foundation of Lenovo's profit; on the other hand, Motorola's mobile phone has the most balanced profit and loss. Lenovo's mobile phone business is the first to stop bleeding.
In fact, according to the latest survey data from Counterpoint, Lenovo's mobile phone shipments fell by 26 points worldwide in the third quarter compared with the same period last year, and its market share shrank by 1%.
Yang Yuanqing said that because Lenovo continued to "shrink" its mobile business, it could make a significant improvement in mobile business. At present, Lenovo Mobile business only focuses on the four major markets of America, Europe, China and India.
Despite the first step towards profitability, Motorola's business lines remain hidden. Apart from a 65% year-on-year increase in smartphone shipments in the Americas, there is still a downward trend in sales in other overseas markets.
Q2 points out that the whole mobile business is losing $50 million. Although the profitability of the mobile business in China is still the biggest trough in the whole financial report, its loss is being substantially reduced.
From August to September, China's smartphone shipments fell 13% and 12% year-on-year, respectively. Lenovo's mobile phone business in China achieved 76% negative growth.
Yang Yuanqing has put forward a new hope that Lenovo's mobile business in China will be profitable in 2019, which is also regarded as the first goal of the whole mobile business.
Liu Jun, President of Lenovo China, has also shown a satisfactory attitude towards the growth of China Mobile's business. "The whole logic and philosophy of our mobile business is different from that of other mobile phone manufacturers, which we thought at the outset is very clear." At the scene of the earnings communication conference, he threw out such a meaningful word.
It's not difficult for Lenovo to let the top secret "Normandy Plan" of Lenovo's mobile business, which was exposed by the media some time ago. Although Lenovo remains silent about the plan, it is certain that the plan will have a long-term guiding role for Lenovo's future development.
Liu Jun revealed that insisting on making smartphones is an important part of SloT 2.0 strategy. "So when we make cell phone pricing, we pay more attention to the follow-up interaction of mobile phones with customers and the benefits of providing services to customers."
At present, the focus of Lenovo's Smartphone development in China is the middle and low-end market of 1000-1500 yuan. However, Liu Jun said that it is not the focus of Lenovo's efforts to imitate the way millet enters the market to regain the brilliance of the "China Cool Alliance" era. Lenovo intends to make a long-term fishing trip, hoping to take smartphones as the leader and form user stickiness, so as to smoothly launch SloT products around smartphones and form its own smartphone ecology when the era of interconnection arrives.
In addition to the importance that mobile services attach to customer service, Yang Yuanqing also said that the service industry will be a focus in the future.
In terms of application software services, Lenovo has a company called Medion in Europe, which provides virtual operators, music, etc. for mobile phone users, he revealed.videoIn terms of services, it generated $700 million in revenue in one quarter, with a gross margin of 30%. This does not belong to the core business and core area of Lenovo.
As a pillar of Lenovo's profits, PC brings 5.4% pre-tax profit, which can be regarded as considerable hardware revenue.
Lenovo is now stepping up its intelligent transformation and data transformation. Yang Yuanqing realizes that in traditional data centers, Lenovo is only strong in hardware.The server. "In the past, the storage was relatively weak and the network was relatively weak. In these two areas, the profit is even higher than that of the server.
Moreover, at a time when enterprises have lightly installed "cloud" to reduce their own IT assets, Lenovo's once proud server sales have gradually become weak. IBM's x86 servers, which once dominated sales in China, have long been sold at "cheaper" prices.HUAWEIAnd the wave.
Therefore, in the growth of data center business (DCG), Yang Yuanqing believes that one leg is intelligent infrastructure, and the other leg is to drive intelligent vertical industry solutions, including data design, construction and daily operation and maintenance of data center.
He said that big data and vertical industry solutions, with revenue of 13 million US dollars last year, close to 100 million RMB, have grown to 176 billion US dollars in a quarter and are expected to grow more than threefold this year.
"Traditional infrastructure is very separate, server, storage, network, but in cloud computing, more is the price of hyperintegration, all these things are defined by software." Lenovo is still at the stage of making up missed lessons in basic software services, Yang Yuanqing explained.
Therefore, Lenovo will announce in September this year that it will establish a joint venture with Netapp, which has leading storage and data management capabilities.
According to the second quarter earnings report, Lenovo DCG business revenue growth rate reached 58%. Among them, the growth rate of software definition infrastructure has reached 150%, and the super-large-scale data center business is also facing a triple-digit growth.