Lenovo Apr-Sep Net Profit $67 Million; Down 80% on Year

By Chester Yung Features Dow Jones Newswires

Lenovo Group Ltd. (0992.HK) on Thursday said net profit dropped 80% in the April-September period on higher expenses and challenging market conditions.

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The Chinese personal-computer maker said net profit for the six-month period fell to $67 million from $330 million a year ago, while revenue edged higher to $21.77 billion from $21.29 billion.

The company's gross profit margin fell 1.1 percentage points to 13.7%, largely weighed on by component cost increases arising from supply constraints across various products, it said.

For the fiscal second quarter ended September, Lenovo posted a 11% year-over-year drop in net profit to $139 million, while revenue rose 5% from a year ago to $11.76 billion.

The company declared an interim dividend of six Hong Kong cents a share.

Lenovo is the world's largest PC maker by shipments, but it has been trying to shift its business toward smartphones and servers, sectors with greater growth potential. It acquired smartphone maker Motorola Mobility and an International Business Machines Corp. server unit in 2014, but has struggled to make them competitive.

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Write to Chester Yung at chester.yung@wsj.com

(END) Dow Jones Newswires

November 02, 2017 01:12 ET (05:12 GMT)