GearWERKZ TechBlog

I like it when I do my small part to help make some news. Clearly, my recent purchase of a Thinkpad Edge E420 (pictured below) was the one sale that pushed Lenovo over the top to score killer earnings in Q1. Leading the charge to one of its highest earnings reports since the Chinese company bought the PC arm of IBM 6 years ago, were largely increased sales in China and emerging markets. Sales in China were up 13% and comprised nearly half of the company's revenue this past quarter. Sales in emerging markets were up 26%.

Lenovo is attempting to make the tablet product category a core part of its portfolio. However, with so much momentum behind Apple's iPad, to call that prospect an uphill battle is an understatement. Still, Lenovo has debuted their K1 Tablet with review scores comparable to other Android tablets on the market. The hook of the K1 is that the GUI is designed to surface functionality more so than an emphasis on discrete apps. Lenovo is hoping that this approach to simplifying functional access at a higher level will give the tablet an ability to compete with the iPad's perceived ease of use, as well as differentiate the K1 from other Android tablets. Android devices continue to be seen as tools for tinkerers, although it has gained significant mainstream appeal. However, the mobile OS is still not the first one that consumers new to smart mobile devices reach for on store shelves.

Despite Lenovo's gains, the company is still projected to come in lower than HP and Dell in terms of total PC market-share. However, Dell has reduced its year-end revenue projections, and Lenovo has closed the market-share gap to within 0.5% of Dell, with the latter holding 12.5% ahead of Lenovo's 12.0%. This represents a 2% market-share increase from the previous quarter for Lenovo, resulting in the company almost doubling their net profit from last year, coming in at $108 million.

In addition to tablets, Lenovo will now try to drive increased market-share by entering the ultrabook market. However, COO Rory Read does not feel that the company will get the product under the magic $1000 mark until sometime in 2012. In the company's earnings call, Read intimated that he "...wouldn’t say by the end of the year necessarily but…that’s definitely going to happen.”

Here is the link to the Press Release: Lenovo Earnings Call

Source: Bloomberg

Source: Athenna