Lenovo refocuses business structure as services rake in $1.4B for Q3

Lenovo refocuses business structure as services rake in $1.4B for Q3

Splits business into three different remits, forming new ‘solutions and services’ arm

Ken Wong (Lenovo)

Ken Wong (Lenovo)

Credit: Ken Wong

Chinese hardware vendor Lenovo has consolidated its offerings into three distinct business units, creating a new arm dedicated solely to offering devices and services. 

Under the new division, named ‘Solutions and Services’, Lenovo will offer smart verticals, attached services, managed services and ‘as a service offerings’ including Device-as-a-Service. 

The ‘Solutions and Services’ arm will be led by current Lenovo president Ken Wong, who will take on the new role from 1 April this year. 

Meanwhile, Lenovo has also split its remaining business into ‘smart’ internet of things (IoT) offerings, naming the unit Intelligent Devices Group (IDG). The other arm is focused on infrastructure solutions and has changed its name from Data Centre Group (DCG) to Infrastructure Solutions Group (ISG). 

The decision to launch a standalone services group follows Lenovo’s third-quarter results, which saw its software and services revenue stand at a record US$1.4 billion, more than 8 per cent of its total revenue. 

Meanwhile, revenue from attached services, managed services and solution services saw year-on-year growth of nearly 26 per cent, 73 per cent and 49 per cent respectively, while Device-as-a-Service grew by 75 per cent in the period. 

“The challenges of 2020 continue, in varying degrees, into the new year,” the company said in a statement. “These include ongoing geopolitical uncertainties, component supply shortages resulting from strong demand, and the global COVID-19 pandemic.” 

“The new global norm of work-, study-and play-from-home will continue to drive long-term and sustainable growth trends in device demand and cloud/infrastructure requirements,” the vendor added.  

Last year, Lenovo invested in a Partner Hub for the Asia Pacific region, providing real-time sales and quoting tools to its channel partners. 2020 also saw Lenovo end its relationship with distributor Synnex for its IDG business as part of its drive to accelerate an intelligent transformation strategy.  

As such, Lenovo accordingly aligned its focus in distribution across commercial and consumer segments, for the PC business, while accelerating solutions including SmartHome, SmartOffice, Commercial IoT and Smart Verticals -- education, health and retail. 

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