Lenovo Group (聯想), the world’s fourth-biggest personal computer maker, reported its second straight quarterly profit yesterday as a 33 percent rise in sales drove its recovery from the global downturn.
Profit for the three months ending Dec. 31 was US$80 million, or US$0.86 per share, compared with a US$97 million loss for the same period in 2008, said Lenovo, based in Beijing and Morrisville, Carolina. Global sales rose to US$4.8 billion.
HIT HARD
Lenovo was hit hard by the global economic crisis, which prompted its corporate customers to slash purchases. The company suffered three losing quarters before rebounding to earn US$53 million in the three months ending Sept. 30.
The company, which acquired IBM Corp’s personal computer (PC) unit in 2005, said its global market share expanded to 9 percent, its highest to date.
“We have achieved our highest-ever global market share for the third straight quarter and notably increased profitability,” chief executive officer Yang Yuanqing (楊元慶) said in a statement. “These achievements demonstrated the effectiveness of the strategies we mapped out at the beginning of the year.”
EXPANSION PLANS
Yang said Lenovo plans to expand in mobile Internet after launching a netbook and a smartphone last month. The company paid US$200 million in November to buy back mobile phone assets that it sold earlier to focus on PCs.
“In the future, while we continue to expand our PC business, we also want to attack the mobile Internet category to drive growth and capitalize [on] our innovation efforts,” Yang said.
Quarterly sales in Lenovo’s home China market soared 45 percent from a year earlier to US$2.3 billion, accounting for 47 percent of the company’s worldwide total.
The company said its China market share rose 2.8 percentage points to 33.5 percent despite competition from industry leaders Dell Inc and Hewlett-Packard Co, which are trying to expand sales to both prosperous cities and the poorer countryside.
In mature markets such as the US and Western Europe, sales rose 13 percent from a year earlier to US$1.7 billion, the company said. In India and other emerging markets, sales rose 52 percent to US$857 million.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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