Chinese PC maker Lenovo has swung to a net profit in the three months through December, beating market expectations, due to strong performance across its major business groups.
Profit for the quarter reached US$233 million, versus a loss of US$289 million in the same period a year earlier when the world's largest personal computer (PC) maker by shipments took a one-off hit due to US tax reform.
The result was ahead of the US$207 million average of 10 analyst estimates compiled by Refinitiv.
Revenue rose 8.5 per cent to US$14.04 billion, the highest in four years and in line with analyst estimates.
Lenovo's mobile phone business also recorded a pre-tax profit - of US$3 million - for the first time since it bought Motorola in 2014 for US$2.9 billion. Revenue nevertheless declined 20 per cent, with Lenovo attributing the fall to a strategy of focusing on core markets.
The firm said revenue in its PC and smart devices business rose 12 per cent, and that its global PC market share was 24.6 per cent.
Industry tracker Gartner last month said worldwide PC shipments fell 4.3 per cent in the December quarter and 1.3 per cent in 2018, but that the biggest three vendors - Lenovo, HP Inc and Dell Inc - expanded their market share in the quarter to 63 per cent of total shipments from 59 percent.
Loss in Lenovo's data centre business narrowed to US$55 million from US$86 million a year earlier, while revenue grew 31 per cent.
Lenovo, which bought IBM's personal computer and server businesses, is dual-headquartered in Beijing in China and North Carolina in the United States, with manufacturing in both countries.
It said in its earnings statement that it was "well prepared for geographic political and macroeconomic volatility" with its worldwide manufacturing capabilities.
(Reporting by Sijia Jiang; Editing by Christopher Cushing)