Business Wire

LENOVO-GROUP

Share
Lenovo Group: Full Year Financial Results 2022/23

Lenovo Group (HKSE: 992) (ADR: LNVGY) today announced full-year results, reporting Group revenue of US$62 billion and net income of US$1.6 billion, or US$1.9 billion on a non-Hong Kong Financial Reporting Standards (HKFRS) [1] basis. Profitability was stable with gross margin and operating margin both delivering 18-year highs and non-HKFRS net margin flat year-to-year. While Group revenue was impacted due to the softness in the device market, revenue from non-PC businesses reached a fiscal year high of nearly 40%, fueled by Lenovo’s diversified growth engines of Solutions and Services Group (SSG) and Infrastructure Solutions Group (ISG) growing revenue to record highs of US$6.7 billion and US$9.8 billion respectively, up 22% and 37% year-on-year.

After a year of industry and global uncertainties, Lenovo sees positive signs of the market stabilizing. The Group expects the entire PC and smart devices market to resume year-to-year growth in the second half of 2023, and for the IT services market to resume relatively high growth - together these will drive the total IT market in 2023 back to moderate growth. In the mid-to-long term, digital and intelligent transformation will continue to accelerate, leading to a big growth potential for cloud and computing infrastructure.

Lenovo’s cash position remains strong, and its cash conversion cycle has further improved. This healthy liquidity has seen the Group continue to invest in R&D around ‘New IT’ (client, edge, cloud, network, and intelligence) to build its future core competencies. During the last year, Lenovo increased its full year investment in R&D to US$2.2 billion, up 6% year-to-year.

In Q4, the Group recognized a one-time restructuring and other charges of US$249M, among various other actions, to deliver around US$850M of annual run-rate group expense savings, helping to establish a solid foundation for the Group’s operations in a challenging market, and position it for future growth.

Lenovo’s Board of Directors declared a final dividend of 3.8 US cents or 30.0 HK cents per share for the fiscal year ended March 31, 2023.

Financial Highlights:

 

FY 22/23

US$ millions

FY 21/22

US$ millions

Change

 

 

Group Revenue

61,947

71,618

(14%)

 

Pre-tax income

2,136

2,768

(23%)

 

Net Income (profit attributable to equity holders)

1,608

2,030

(21%)

 

Net Income (profit attributable to equity holders – non-HKFRS) [1]

1,878

2,164

(13%)

 

 

 

Basic earnings per share (US cents)

13.50

17.45

(3.95)

 

Chairman and CEO quote – Yuanqing Yang:

“Lenovo has delivered stable profitability in the last fiscal year as our diversified growth engines continue to hit new milestones. Their momentum is driving steady progress in our services-led transformation, and our non-PC businesses’ revenue mix increased to nearly 40%. Our clear strategy is working, and our operation is resilient, even in the face of global uncertainties. Going forward, we will continue to invest in R&D to capture the next wave of growth opportunities, so we are well prepared for the future.”

Solutions and Services Group (SSG): high margin, strong growth

Opportunity:

The ‘New IT’ services segments within the trillion-dollar IT services market continue to expand, with Device-as-a-Service (DaaS) and cloud solutions expected to grow at double digits CAGR by 2025. Spending in solutions and services will remain strong, in particular in education, smart retail, smart city, and manufacturing.

FY22/23 performance:

  • SSG continues to be the growth engine for the Group and an important profit contributor.
  • Revenue reached an all-time record, up 22% year-to-year to US$6.7 billion, with a high operating margin of 21%.
  • High double-digit growth across all segments, with the revenue mix from non-hardware-centric solutions and services now accounting for more than half of SSG’s revenue.

Sustainable Growth:

  • SSG continues to invest in building scalable and repeatable horizontal solutions or building blocks that can be deployed in any industry, leveraging Lenovo IP.
  • In addition, SSG enriched its digital workplace solutions and TruScale hybrid cloud solutions portfolio.
  • Scaled TruScale for SAP with Private Edition Customer Data Center (PE CDC) and expanded exclusive partnership to provide technical managed service for SAP PE CDC customers in China.

Infrastructure Solutions Group (ISG): record revenue, record profit, hypergrowth

Opportunity:

ISG continues to benefit from the ongoing ICT infrastructure upgrade. By 2025, the server market alone is expected to surpass US$132 billion, with storage expected to reach US$36 billion and edge infrastructure US$37 billion.

FY22/23 performance:

  • Historic full year performance for ISG as a profitable high-growth engine. Revenue grew to almost US$10 billion, up 37% year-to-year, with record operating profit of US$98 million.
  • Revenue from the server business grew by almost 30% year-to-year to a record high, making Lenovo the third largest server provider in the world.
  • Storage also reached a record high revenue, tripling the previous fiscal year’s results and moving from the #8 position in the world to #5. Software revenue grew 25% year-to-year, another record.

Sustainable Growth:

  • ISG continues to enhance its full stack capabilities that cover both the Cloud Service Provider and Enterprise and SMB segments.
  • At the same time, ISG is investing in infrastructure innovations empowered by artificial intelligence (AI), such as AI-powered edge computing and hybrid cloud.
  • Inhouse manufacturing and cost competitiveness has been bolstered with the addition of an inhouse facility in Budapest, Hungary.

Intelligent Devices Group (IDG): leading market position and profitability

Opportunity:

The business was impacted by several quarters of device market softness due to channel inventory digestion. With PCs the essential productivity tool in today’s digital era, Lenovo anticipates that the PC market will return to growth in the 2nd half of calendar year 2023. The digitalization trend and hybrid work model continue to drive steady growth in smart spaces solutions.

FY22/23 performance:

  • IDG revenue declined year-on-year to US$49.4 billion, but successfully maintained the #1 position in the PC market with 23.2% market share globally and maintained its industry-leading profitability of 7.3%.
  • Revenue mix from premium products increased to nearly 30%.
  • The smartphone business has been profitable for three consecutive years and achieved premium-to-market revenue growth in most markets.

Sustainable Growth:

  • IDG will closely manage expense and further sharpen its operational excellence.
  • It will continue to invest in technology innovations focusing on premium offerings and adjacent areas, while at the same time enhancing smart space solutions for hybrid work models.

Q4 Performance

Fiscal year Q4 was the most challenging quarter of the year given pressures from both the PC market and the global economy. Lenovo closed the quarter with revenue of US$12.6 billion, down 24% year-to-year. Revenue from IDG declined 33% year-to-year, while the strong momentum from the growth engines of SSG and ISG helped offset the device market softness. SSG revenue was up 18% YTY to US$1.6 billion, and ISG revenue was up 56% to US$2.2 billion. Non-PC revenue mix during the quarter reached a historic high of 43%, up 12 points year-to-year.

Q4 Operational highlights

Environmental, Social, Governance - Lenovo’s Environmental, Social and Governance Rating score was recently upgraded to AAA by MSCI, the international ratings agency. This upgrade represents the highest possible rating for corporations leading in ESG programs. In addition, EcoVadis recognized Lenovo for its excellence in sustainable procurement at its 7th annual Sustainable Procurement Leadership Awards. The company was also recently recognized by Forbes as one of the Best Employers for Diversity in 2023, evaluated based on direct recommendations, indirect recommendations, and research on the key performance indicators.

[1] non-HKFRS measure was adjusted by excluding net fair value changes on financial assets at fair value through profit or loss, amortization of intangible assets resulting from mergers and acquisitions, mergers and acquisitions related charges; restructuring and other charges; and the corresponding income tax effects, if any.

About Lenovo

Lenovo (HKSE: 992) (ADR: LNVGY) is a US$62 billion revenue global technology powerhouse, ranked #171 in the Fortune Global 500, employing 77,000 people around the world, and serving millions of customers every day in 180 markets. Focused on a bold vision to deliver smarter technology for all, Lenovo has built on its success as the world’s largest PC company by further expanding into growth areas that fuel the advancement of ‘New IT’ technologies (client, edge, cloud, network, and intelligence) including server, storage, mobile, software, solutions, and services. This transformation together with Lenovo’s world-changing innovation is building a more inclusive, trustworthy, and smarter future for everyone, everywhere. To find out more visit https://www.lenovo.com, and read about the latest news via our StoryHub.

LENOVO GROUP

FINANCIAL SUMMARY

For the quarter and year ended March 31, 2023

(in US$ millions, except per share data)

 

 

Q4
FY22/23

Q4
FY21/22

 

Y/Y CHG

 

 

FY22/23

 

FY21/22

 

Y/Y CHG

Revenue

 

 

12,635

16,694

(24)%

 

61,947

71,618

(14)%

Gross profit

 

 

2,143

2,864

 

(25)%

 

10,501

12,049

(13)%

Gross profit margin

 

 

17.0%

 

17.2%

 

(0.2) pts

 

17.0%

16.8%

0.2 pts

Operating expenses

 

 

(1,852)

 

(2,275)

 

(19)%

 

(7,832)

(8,968)

(13)%

R&D expenses
(included in operating expenses)

 

550

 

576

 

(5)%

 

2,195

2,073

6%

Expenses-to-revenue ratio

 

 

14.7%

 

13.6%

 

1.1 pts

 

12.6%

12.5%

0.1 pts

Operating profit

 

 

291

 

589

 

(51)%

 

2,669

3,081

(13)%

Other non-operating income/(expenses) – net

 

(161)

 

(69)

 

134%

 

(533)

(313)

70%

Pre-tax income

 

 

130

 

520

 

(75)%

 

2,136

2,768

(23)%

Taxation

 

 

(24)

 

(99)

 

(75)%

 

(455)

(623)

(27)%

Profit for the period/year

 

 

106

 

421

 

(75)%

 

1,681

2,145

(22)%

Non-controlling interests

 

 

8

 

(9)

 

N/A

 

(73)

(115)

(37)%

Profit attributable to equity holders

 

114

412

 

(72)%

 

1,608

2,030

(21)%

Profit attributable to equity holders – non-HKFRS[1]

 

 

284

507

 

(44)%

 

1,878

2,164

(13)%

Earnings per share (US cents)
Basic
Diluted

 

 

0.95

0.93

 

3.52

3.20

 

(2.57)

(2.27)

 

 

13.50

12.74

 

17.45

15.77

 

(3.95)

(3.03)

To view this piece of content from cts.businesswire.com, please give your consent at the top of this page.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230523006160/en/

About Business Wire

Business Wire
Business Wire
101 California Street, 20th Floor
CA 94111 San Francisco

http://businesswire.com
DK

Subscribe to releases from Business Wire

Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.

Latest releases from Business Wire

Shield and PwC UK Forge Strategic Collaboration to Deliver Future-Ready Communications Compliance18.9.2025 08:00:00 CEST | Press release

Collaboration brings together Shield's AI-first platform with PwC's surveillance expertise to deliver measurable compliance outcomes Shield, a leading AI platform for digital communication governance and archiving, today announced a collaboration with PwC UK, one of the world’s most trusted professional services firms. The alliance brings together Shield’s unified, cloud-native solution with PwC’s specialist expertise in communications surveillance delivery, regulatory compliance and complex programme execution. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20250917394739/en/ Shield and PwC launch a strategic collaboration to modernize eComms surveillance with AI-driven compliance solutions for financial institutions. The collaboration is designed to support institutions as they modernise their approach to communications monitoring, helping them implement an advanced and proactive risk management approach at scale and with co

Almirall Presents Long‑Term Results from First Real‑World Dermatology Study Using WHO‑5 Well‑Being Index as Primary Endpoint in the treatment of Psoriasis at EADV 202518.9.2025 08:00:00 CEST | Press release

Results of the POSITIVE study assessing the treatment with tildrakizumab showed sustained improvements in skin clearance, psychological well-being, and improved partner quality of life in adults with moderate-to-severe psoriasis over two years.POSITIVE is the first real-world evidence (RWE) study in dermatology to use the WHO-5 Well-Being Index as a primary endpoint, complementing traditional measures of skin disease (PASI, PGA), quality of life (DLQI), with the assessment of psychological well-being, marking a paradigm shift towards holistic management of psoriasis.The POSITIVE study highlights Almirall’s leadership in advancing patient-centred dermatology aligned with the WHO’s health definition and recent resolution on skin diseases.Almirall’s extensive scientific contributions to EADV 2025 include 44 abstracts across key dermatological conditions including atopic dermatitis, psoriasis, actinic keratosis, and hidradenitis suppurativa, and two expert-led symposia. Almirall, S.A. (ALM

Curatis: FDA Minutes Confirm Positive Outcome of Meeting on 9. September 2025 – Corticorelin on Track for Phase 318.9.2025 07:00:00 CEST | Press release

Curatis Holding AG (SIX:CURN) received the official minutes from the FDA meeting which took place on 9. September. Based on the totality of the feedback and discussions, Curatis can proceed as planned with the clinical development of corticorelin. Corticorelin is under development as a novel treatment intended to reduce or even eliminate steroid use and associated toxicities thereby potentially impacting the quality of life of patients suffering from peritumoral brain edema (PTBE) associated with metastatic (secondary) brain tumors. The virtual meeting with the FDA provided the opportunity to discuss the clinical development plan for corticorelin and encompassed CMC (Chemistry, Manufacturing and Control), nonclinical and clinical aspects. The offical FDA minutes which Curatis received after publication of the half year results reflect the positive outcome. Curatis may proceed without delay to a regulatory submission supporting a pivotal study in patients suffering from PTBE secondary t

Galderma Launches Transformative Skincare Segment With Cetaphil’s New Skin Activator Hydrating & Firming Line, in Partnership With Actor and Filmmaker Mariska Hargitay18.9.2025 07:00:00 CEST | Press release

Cetaphil's new Skin Activator Hydrating & Firming Line harnesses a proprietary formula, co-created with dermatologists and offering targeted, high-performance skincare designed to improve the appearance of skin affected by dermatoporosis The line’s new Skin Activator technology uses microdosed alpha hydroxy acid (AHA) and encapsulated centella asiatica (CICA) to wake up sleeping surface skin cells To help bring this segment-defining product line to life, Cetaphil is partnering with acclaimed actress, director, and advocate, Mariska Hargitay, a powerful voice in embracing beauty at every stage Galderma today announced Cetaphil, the dermatologist-recommended brand trusted by millions with sensitive skin, is redefining daily skincare with its new Skin Activator Hydrating & Firming line. The launch marks an entirely new skincare segment of advanced hydration and firming solutions designed specifically for improving the appearance of aging, thinning, and fragile skin. As people age, surface

Merck Opens Climate-Neutral €150 Million Filter Manufacturing Facility in Ireland18.9.2025 07:00:00 CEST | Press release

Part of company’s €440 million investment in Ireland, strengthens Merck’s in-region-for-region supply resilienceMerck’s first climate-neutral manufacturing facility, powered by 100 percent renewable electricityNew Blarney site in Cork, Ireland expands filter manufacturing capacity, creating more than 200 jobs by 2028 Merck, a leading science and technology company, has opened today its €150 million filter manufacturing facility in Blarney Business Park, Cork, Ireland. The site is Merck’s first manufacturing facility designed for full climate-neutral operations, marking a key milestone in the company’s ambition to achieve climate neutrality by 2040. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20250917767425/en/ Merck's new Blarney site in Cork expands company's filter capacity, creating 200+ jobs by 2028 The 3,000-square-meter cleanroom facility supports global demand for critical filtration products used in the manufacturin

In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.

Visit our pressroom
World GlobeA line styled icon from Orion Icon Library.HiddenA line styled icon from Orion Icon Library.Eye