Lenovo Q3 numbers up as channel support builds


Lenovo Q3 numbers up as channel support builds

Microscope contributor

The turnaround plan Lenovo that began a year ago when former CEO Bill Amelio left is truly paying off following a third quarter hikes in sales, shipments and profits.

Sentiments in the channel towards the vendor also appear to be on the turn as the firm, which disappointed many resellers in the years after it acquired IBM's PC division, is getting its act together at a time when many are disillusioned by HP.

Unit sales for the period ended 31 December grew 42% year-on-year while the worldwide market went up 17%, revenues climbed 33% to $4.8bn and profit crossed the line at $80m, compared to a loss of $97m a year ago.

"For the first time since the acquisition of IBM PCD, Lenovo was the fastest growing PC company in the world," said Lenovo CEO Yuang Yuanquing.

Global market share of PC sales - which had been moving up in the two three quarters - is 9%, its highest ever and along with profit rises meant the results emphasised the turnaround plan devised at the start of the year was effective. 

Last week Lenovo held its first ever partner conference in Europe where senior execs met with distributors and resellers.

The overriding message to partners was that the channel remains its major route to market and recent compensation changes were working, Milko Van Duijl, president of mature markets told MicroScope.

"We have evaluated the first full quarter based on the new channel programme, we have recruited more partners and increased our share of wallet with the biggest ones...and moved up in the world in terms of our PC ranking," he said.
The channel structure is certainly cleaner after Lenovo merged its SME transactional and corporate relationship business units to minimise conflict. And the strategy in Europe is clear said Van Duijl - protect corporate customers, attack the SME space and steer clear of building a services business.

"There is a drive and strategy [to move into services] that we saw with IBM and are seeing at HP and Dell," he said, "partners are worried about that because they provide add on services...but for Lenovo clearly we have no strategy to diversify into services."

Mike Rodwell, commercial director at Computacenter, said "Lenovo has a huge appetite to win business with the channel...and views its future success as a partnership with resellers."

The ThinkPad range had always resonated with customers said Dan Laws, managing director at Kelway, but the challenge it faced was related to the relatively lower rebates on offer.

"Lenovo is a more palatable commercial proposition than it was previously and there seems a willingness outside of the top accounts to talk about indirect relationships," he said.

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