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Remote working helps Lenovo take 20% market share in SA

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 08 Feb 2021
Thibault Dousson, country GM at Lenovo South Africa.
Thibault Dousson, country GM at Lenovo South Africa.

Lenovo says it has achieved strong financial growth for the second consecutive quarter, with the Chinese multinational technology company reaching 20% market share of SA’s PC market.

In its third quarter results, Lenovo says it performed well across its 180 markets, despite the challenges posed by the COVID-19 pandemic, as well as the ongoing geo-political uncertainties and component supply shortages resulting from strong demand across the globe.

Revenue was up 22% year-on-year, reaching $17.2 billion, pushed by greater demand for its hardware, as the pandemic prompted a rapid shift to remote working.

Lenovo, which is the world's largest PC vendor by unit sales as of January 2021, also designs, develops and manufactures tablet devices, smartphones, workstations, servers, supercomputers, electronic storage devices, IT management software and smart televisions.

According to the company, for the first time it now controls the largest PC market share in Europe, the Middle East and Africa, while North America achieved 60% volume growth year-on-year, and Asia Pacific improved profitability to a new record, and China grew shipments 30% year-on-year.

With the pandemic still in full swing, traditional PCs (inclusive of desktops, notebooks and workstations) are once again an in-demand consumer technology.

According to preliminary results from the International Data Corporation (IDC), the fourth quarter of 2020 saw global PC shipments grow 26.1% year-over-year to 91.6 million units.

In the fourth quarter of 2020, Lenovo took first position, shipping 23 122 million PC units, while competitors HP (19 130 million) and Dell (15 797 million) followed, notes IDC.

Lenovo says it has also sustained strong growth in SA, boosted by a massive uptake of its computing devices as more employees and learners rely on remote working tools, while transformation investments continue to drive new long-term growth opportunities.

“We are thrilled with the latest preliminary IDC figures. In SA, Lenovo has maintained the number one market position for the second consecutive quarter – capturing a total market share of 20.2%,” says Thibault Dousson, country GM at Lenovo South Africa.

“Of course, a major driver for our performance was the increasing demand for PCs with so many South Africans operating from home. We are confident we will remain on this strong trajectory of growth, as we continue to aid our customers in adapting to digitally-run world.”

While the Middle East and Africa region experienced a successful PC market in 2019, SA suffered a decline during the course of the year. In 2020, the market saw a rebound, mainly influenced by COVID-19, which resulted in an uptick in online services as more consumers relied on digital technologies.

Lenovo says its latest financial performance further reinforces its view that the lifestyle trends of work-, study- and play-from-home will drive its mission of one device per person, and continue to drive the demand for PCs, tablets and smart devices for the long-term.

Lenovo’s Intelligent Devices division, which encompasses the PC and smart devices business, was the company’s main growth driver, delivering revenue of $14 billion, up 27% year-on-year.

While the business challenges of 2020 are expected to continue, in varying degrees, into 2021, the company says it is confident 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.

“Clearly, 2020 was a challenging year that brought remarkable changes to our world, yet Lenovo quickly responded to the changing market driven by new work and lifestyle trends,” says Yuanqing Yang, Lenovo chairman and CEO.

”Now, as we begin to see the results of our transformation investments, we will further invest in technology and innovation, drive intelligent transformation across industries and create sustainable growth.”

Lenovo also announced a new organisational structure, which it believes will capitalise on the group’s service-led transformation growth opportunities.

Effective 1 April, Lenovo will bring together services and solutions teams and capabilities from across the company to form a dedicated organisation – the Solutions & Services Group.

“With this, Lenovo’s business will be structured into three main business groups aligned to the company’s 3S strategy of smart Internet of things, smart infrastructure and smart verticals, namely Intelligent Devices Group, Infrastructure Solutions Group and Smart Solutions Group.

[This] will further drive the company’s transformation by delivering incremental business across smart verticals, attached services, managed services and Lenovo’s ‘as-a-service’ offerings,” it says.