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Lenovo's Quarterly Profit Surges as It Bets on AI to Drive PC Demand — Update

By Sherry Qin


Lenovo Group's quarterly profit more than doubled as it prepared to roll out its artificial-intelligence-powered devices, betting that the technology will fuel the next wave of demand for personal computers.

Hong Kong-based Lenovo said Thursday that net profit in the fiscal fourth quarter ended March was $248 million. That was up from $114 million a year earlier, when the PC maker battled a postpandemic downturn in PC demand, and beat estimates for $155 million in a FactSet poll of analysts.

Revenue rose 9% from a year ago to $13.83 billion. That was down from the quarter ended December but beat analysts' estimates of $13.10 billion.

Revenue from Lenovo's main intelligent-devices business, which includes PCs, tablets, smartphones and other devices, rose 6.7%.

The company expects the adoption of AI to lead the global PC market to a long-term recovery, surpassing prepandemic levels, and help its intelligent-devices segment deliver better-than-industry growth, strong selling prices and sustainable profitability.

AI PCs run AI applications on the device rather than the cloud, promising greater effectiveness and security. Lenovo recently unveiled its lineup of AI PCs, including two equipped with Microsoft's Copilot AI assistant and Qualcomm's Snapdragon X Elite processor.

"AI PCs represent a major inflection point for the industry, initiating a new product cycle that is particularly attractive to commercial users," Lenovo said.

While AI PCs will likely account for less than 5% of the market this year, Morgan Stanley said it expects that figure to rise to about 64% by 2028.

Morgan Stanley expects the company to be a major beneficiary of the AI PC momentum and projects that the products could generate about half of Lenovo's revenue by 2028, up from 2% in 2024.


Write to Sherry Qin at


(END) Dow Jones Newswires

May 23, 2024 01:36 ET (05:36 GMT)

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