According to Hong Kong's "Newsletter" quoted Lenovo's chief financial officer to report to Huang Weiming, Lenovo's target mobile business loss was halved year-on-year; it plans to reduce annual operating expenses to less than $1 billion; the mobile business will focus on North America, Latin America.
As early as the end of May, Lenovo Chairman and CEO Yang Yuanqing said at the Hong Kong press conference that the mobile business is still the strategic focus of Lenovo. In order to turn losses into profits as soon as possible, the future plan will reduce the total cost of mobile services by 30%.
According to Lenovo's 2017/18 financial year report and fourth-quarter earnings report, Lenovo's most watched mobile business group (MBG) had a turnover of US$1.3 billion in the fourth quarter, and its total annual turnover was US$7.2 billion, down year-on-year. 6%. Although the turnover has fallen, Lenovo is still optimistic about the mobile business. Yang Yuanqing said that he hopes that the mobile business will turn around as soon as possible. In order to achieve this goal, the mobile business will not pursue excessive market share growth in a short period of time. The cost is reduced first. It is expected that by the middle of this year, the total cost will be reduced by 30%. Together with the growth in Latin America and North America, I hope that the mobile business will return to the healthy track as soon as possible.
Earlier, some media reported that Lenovo's Motorola company plans to lay off a large number of people in the Chicago area. Yang Yuanqing said that after going through the mobile Internet, it will enter the era of smart Internet, and there will be more and more intelligence in the future. With the emergence of equipment, Lenovo will use the established platform architecture, including sales network, global supply chain platform, and service platform to develop new services. In the development of these new services, Lenovo will also be able to drive the development of mobile services. Currently, Lenovo is in Latin America, North America. The growth rate is very fast. The annual sales in Latin America increased by 40% year-on-year. The annual sales in North America increased by 57% year-on-year. Therefore, the future of mobile business is still the strategic focus of Lenovo.
In the fourth quarter of last fiscal year, Lenovo announced the integration of the Personal Computer and Intelligent Devices Group and the Mobile Business Group to form the Intelligent Equipment Business Group (IDG), which will further accelerate Lenovo's innovation leadership and achieve strong growth in various smart devices. Goals, Lenovo said, the new architecture will enable companies to more fully leverage global supply chains, global services and other shared platforms to accelerate innovation, especially the convergence of communications and computing technologies, to connect devices, users, applications and content. Lenovo. In mid-August, Lenovo released its first quarterly results for the 2018/19 fiscal year. The report shows that Lenovo's mobile business is recovering. Lenovo's sales in the quarter decreased by 8% year-on-year and 12% quarter-on-quarter. US$65 million. Although it is still at a loss, it has improved significantly from the US$129 million in the same period last year. Yang Yuanqing said that the mobile business will return to a healthy track in a short period of time. The mobile business is the key to realizing intelligent IoT. In a ring, the recovery of Lenovo's mobile business has also made its layout in the SIOT field fast and perfect.
In addition, Lenovo's mobile business achieved double-digit year-on-year growth in Latin America's revenue for the seventh consecutive quarter. Therefore, Lenovo's focus on North America, Latin America and other potential markets is understandable. The first quarter performance report shows that Lenovo's turnover has been achieved for the second consecutive quarter. Double-digit strong growth reached $12 billion, up 19% year-on-year. Profit before tax reached $113 million, an increase of $182 million over the same period last year. At the same time, Lenovo's main business profitability improved significantly. This probably gave Lenovo enough confidence to be able to halve the year-on-year loss of mobile business during the year; even reduce the annual operating expenses to less than $1 billion.