Lenovo rapidly resuming production amid strong financial results

Lenovo Group Ltd, the world's largest personal computer maker, said on Thursday that most of its Chinese plants have restored production and one of its major PC factories will reach full capacity by the end of this month.

The progress came as Lenovo announced that it has reached all-time highs in both revenue and pre-tax income in the quarter that ended in December.

Lenovo Chairman Yang Yuanqing said the company hopes to restore production in all of its Chinese plants next month. Currently, its plants in Shenzhen, South China's Guangdong province, and Hefei, East China's Anhui province have resumed operation, with the former expected to reach full capacity by the end of February, and the latter to hit 70 percent of its capacity by then. The two factories produce the majority of its PCs and other products.

Yang said the company also has stocked components for several weeks, which can meet its demands. Also, it is working with relevant parties to quickly resolve supply issues for future demand.

According to Yang, the ongoing novel coronavirus outbreak in China will not substantially affect its business. Thanks to the company's global manufacturing footprint, its factories in Brazil, India, the United States, Mexico, and Japan are working overtime to churn out products that can reduce some pressure on its Chinese plants.

While demand in China is impacted temporarily, demand from the rest of the world remains strong, which will help accelerate the recovery of its capacity in China. "We also have been working closely with our supply chain partners to ensure normal operation," Yang added.

The company announced on Thursday that it recorded $14.1 billion in revenue in the quarter that ended in December, marking the 10th consecutive quarter of year-on-year growth. Its pre-tax income grew by double-digits year-on-year to reach $390 million. Net income also improved by double-digits year-on-year to $258 million.

The results showcase the company's world-class operations and strategic execution capability in delivering a record-setting performance, despite the geopolitical uncertainties and industry-wide supply shortages last quarter, Lenovo added.

Specifically, the Beijing-based company recorded $14.1 billion in revenue, marking the 10th consecutive quarter of year-on-year growth. Its pre-tax income grew by double-digits year-on-year to reach $390 million. Net income also improved by double-digits year-on-year to $258 million.

Yang said the company's robust performance partly came as its strategy to focus on high-growth and premium segments continues to deliver results.

Lenovo has extended its No 1 position in the global PC market with a record high shipment of 17.9 million units. The volume of its gaming, thin & light, and a string of PCs continued to grow at high double-digits and significantly outgrew the market by double digits year-on-year, Lenovo added.

The Beijing-based company said it has been working hard to help fight the epidemic. The company has donated and installed all IT equipment necessary to construct the two new hospitals in Wuhan, capital of Central China's Hubei province. Donations from Lenovo employees and the Lenovo Foundation have arrived at places in need. It also has given away 100-day activation keys of its remote office and online meeting solutions to hospitals and small- and medium-sized businesses that are heavily impacted by the epidemic.