Lenovo ends its fiscal year with a 75 percent drop in revenue, largely due to a continued decline in PC sales. Fortunately, other segments are doing better.

Lenovo announced financial results for fiscal year 2022, which officially ended March 31. In the past quarter, the Chinese technology group generated sales of 12.63 billion US dollars, 24 percent less than in the first three months of 2022. Profit before taxes fell by an incredible 75 percent to 130 million US dollars. Year-on-year, revenue is down 14 percent ($61.94 billion) and profit is down 23 percent ($2.13 billion).

Falling PC sales

These figures appear dramatic, but they also have to be put into perspective. The fact that Lenovo makes less sales is due to the declining PC sales. This industry brought in 33 percent less than in fiscal 2021.

Not only Lenovo is affected by this, competitors like HP are also seeing that declining PC sales are having an impact on business results. This does not jeopardize Lenovo’s market leadership; according to IDC information, the manufacturer has a market share of 22 percent. Analysts are cautiously optimistic that PC demand will gradually stabilize, and CEO Yanqing Yang also expects to report darker numbers later this quarter.

Other business areas are faring much better. The Infrastructure Solutions Group, which sells servers among other things, recorded an increase in sales from 1.4 billion to 2.2 billion. The solutions and services business had revenue of $6.6 billion compared to $5.4 billion a year earlier. It shows that Lenovo still has enough funds to absorb the downturn in the PC market.