Lenovo Achieves Strong Results Throughout the Year: Innovation and Operational Excellence Strengthen Competitiveness
Lenovo Group Limited (HKSE: 992) (ADR: LNVGY), a global leader in technology solutions, has announced its fourth-quarter and full-year financial results for fiscal year 2024/25, showcasing robust growth and operational excellence. The company reported a 21% year-over-year increase in revenue, reaching $69.1 billion, marking the second-highest annual revenue in its history. Net income surged by 36% to $1.4 billion on a non-Hong Kong Financial Reporting Standards (non-HKFRS) basis, underscoring Lenovo’s ability to deliver consistent value to shareholders.
This remarkable performance reflects Lenovo’s diversified growth strategy, with non-PC revenue accounting for 47% of the mix—an increase of nearly five percentage points year-over-year. All business groups achieved double-digit revenue growth across geographic regions, highlighting the company’s resilient global presence and adaptability to market conditions.
Driving Growth Through Innovation and Hybrid AI
A cornerstone of Lenovo’s success is its commitment to innovation, particularly in the realm of hybrid artificial intelligence (AI). Over the past year, the company invested $2.3 billion in research and development (R&D), representing a 13% increase year-over-year. This investment has yielded groundbreaking advancements, including the launch of AI-powered PCs, where Lenovo now holds the number one position globally in the Windows AI PC category. Additionally, the company introduced the first foldable phone equipped with Moto AI and achieved hypergrowth in its AI server business.
Lenovo’s Hybrid AI strategy has also led to the creation of core solutions such as Lenovo Hybrid AI Advantage, which enhances both personal and enterprise AI capabilities. At its Tech World event in Shanghai, the company unveiled its first personal and enterprise AI super agents, further solidifying its leadership in the AI era.
Chairman and CEO Yuanqing Yang emphasized the importance of this strategic focus, stating, “Our strategy of focusing on hybrid AI has driven significant advancements, laying a strong foundation for leadership in this AI era. With 20 years of navigating global challenges, I am confident that our operational excellence and continued investment in innovation will strengthen our competitiveness.”
Record-Breaking Performance Across Business Groups
Lenovo’s Intelligent Devices Group (IDG) played a pivotal role in the company’s success, achieving a 13% year-over-year revenue increase to $50.5 billion. The group extended its lead in the PC market, widening the gap with competitors while maintaining industry-leading profitability. Lenovo’s AI PCs exceeded volume targets, and its smartphone division experienced hypergrowth, with revenue surging by 27%. The tablet business also saw double-digit sales growth, complemented by innovative product launches such as the rollable ThinkBook Plus Gen 6 and the Legion Go S handheld gaming console.
The Infrastructure Solutions Group (ISG) delivered exceptional results, with revenue skyrocketing by 63% year-over-year to $14.5 billion. The group achieved profitability in the second half of the fiscal year, driven by strong demand for AI infrastructure and Lenovo’s Neptune™ liquid cooling solutions. Meanwhile, the Solutions and Services Group (SSG) reinforced its position as a high-margin transformation engine, growing revenue by 13% to $8.5 billion and achieving an operating margin of 21.1%.
A Resilient Global Supply Chain
Lenovo’s integrated end-to-end global operations have been instrumental in navigating uncertainties and adapting to changing market dynamics. With over 30 manufacturing sites across 11 markets, the company’s ODM+ manufacturing model and global sourcing/local delivery approach provide maximum flexibility and resilience. This robust supply chain ensures that Lenovo can meet customer demands efficiently while maintaining cost-effectiveness.
Commitment to Sustainability and Inclusion
Beyond financial achievements, Lenovo continues to make strides in environmental, social, and governance (ESG) initiatives. The company is on track to achieve its 2030 emissions reduction targets, aligned with the Science Based Targets initiative. Lenovo’s efforts have earned global recognition, including the Gold Award in the Most Sustainable Business/Organization category at the HKICPA’s Best Corporate Governance & ESG Awards and the EcoVadis Platinum Medal, placing it in the top 1% of rated companies worldwide.
Inclusivity remains a core value for Lenovo, as evidenced by its commitment to disability inclusion. The company was named a “Best Workplace for Disability Inclusion” for the fourth consecutive year in the US, with expansions into Brazil and the UK. Furthermore, Lenovo has adopted governance principles to ensure the responsible and ethical development of AI, reinforcing its dedication to delivering smarter technology for all.
Sustaining Momentum in a Competitive Market
As Lenovo looks to the future, the company remains confident in its ability to maintain and enhance its competitive edge. By continuing to prioritize innovation and leveraging its globally balanced business model, Lenovo is well-positioned to capitalize on emerging opportunities in the AI-driven economy. The Board of Directors has declared a final dividend of 3.9 US cents or 30.5 HK cents per share for the fiscal year ending March 31, 2025, reflecting the company’s commitment to rewarding shareholders.
In conclusion, Lenovo’s strong financial performance and strategic focus on hybrid AI underscore its ability to thrive in an increasingly competitive market. With a proven track record of operational excellence, a diversified portfolio, and a steadfast commitment to sustainability, Lenovo is poised to remain a leader in the global technology landscape. As the company continues to innovate and expand its ecosystem of AI-powered solutions, it sets a benchmark for others in the industry to follow.
By combining cutting-edge technology with a customer-centric approach, Lenovo not only strengthens its own competitiveness but also contributes to shaping a smarter, more connected world. For stakeholders and customers alike, Lenovo’s journey serves as a testament to the power of innovation and resilience in driving long-term success.
