Chinese vendor Lenovo reported a small profit in fiscal Q2 2016, boosted by a one-off property sale, but its mobile business continued to struggle.
The mobile and PC supplier posted net income of $157 million, a significant shift from its worse ever quarter at the same point last year, when it plunged to a loss of $714 million. It was helped by disposal gains of property of $206 million, and other assets amounting to $12 million.
This was on overall revenue of $11.2 billion, down 8 per cent, from $12.2 billion last year.
“Lenovo’s solid performance came at a challenging time in the industry, with both the PC and tablet markets down, and smartphones and servers showing only modest growth,” said the company in a statement.
Indeed, its mobile business unit, which includes Motorola and Lenovo devices, again lagged, with sales down 12 per cent, reaching $2 billion, from $2.3 billion, and resulting in a pre-tax loss of $156 million.
Shipments of mobile products for the quarter reached a total of 14 million, with strong growth across Asia-Pacific, and 15 per cent year on year growth in India.
Despite the loss, the company noted the quarter represented a 20 per cent increase in sales from the previous quarter of the year, and a 25 per cent increase in shipments on the same metric.
Going forward, Lenovo said it will work on streamlining and innovating its mobile business, while warning market conditions in the short term will remain challenging.
“The group will develop new smart devices, powered by cloud and enriched with services,” read a filing. “The group is exploring smart home, smart office, smart healthcare and other areas by leveraging aritificial intelligence, AR, VR and other new technologies.”
Its PC and smart devices business group, including tablets, saw an 8 per cent decrease in sales, reaching revenue of $7.8 billion.
“Top minds” join leadership team
Supposedly, in a bid to stop the slide, Lenovo also announced changes to its leadership teams, with the appointment of several “top minds” from the industry.
Former Intel executive Kirk Skaugen joins as EVP and president of Lenovo’s data centre group, an ex Alcatel-Lucent EVP of Intellectual property is the company’s new chief legal officer and SVP, while it has also recruited Yong Rui as CTO and SVP, from Microsoft Research Asia.