Lenovo Hits Record $20 Billion Quarterly Revenue Mark

The tech giant continues to capitalize on record PC sales while banking profits for future growth—and partners say they’re thriving despite supply chain woes.

Lenovo Wednesday reported a record $20 billion in revenue for its most recent quarter, aided by growth in all of its core businesses.

The earnings report from the third quarter of fiscal year 2021/2022 showed net income growing 62 percent year over year to a record $640 million—the sixth consecutive quarter showing net income growth of more than 50 percent. The Hong Kong-based company has capitalized on a huge increase in PC demand as COVID-19 forced more at at-home and hybrid work over the past two years and managed to outsell a supply chain crisis that has hobbled other tech companies.

Lenovo CEO Yang Yuanqing touted the results while doubling down on the company’s commitment to continue investing in research and development. “Lenovo continued to embrace the opportunities driven by accelerated digital and intelligent transformation, and our new IT architecture prepared us well,” Yang said in a statement. “We remain on track to double both our net margin and R&D investment in three years from FY20/21 levels.”

[Related story: Lenovo Tops HP, Dell In Best Year For PC Shipments In Decade: IDC]

For Dan Hammack, chief technical officer at DHE Computer Systems in Centennital, Colo., Lenovo’s results show a strong commitment to channel partners. “We’re doing great,” he said. “And the reason it’s going so well is that they haven’t backed off their commitment to partners. They’ve raised prices like everyone else, but they’ve been fair to the partners.”

DHE is a Platinum Lenovo partner with $70 million to $80 million in annual sales. Hammack works with other partners as well and supply chain constraints have been an issue everywhere, but DHE has overstocked devices and accessories in a gamble to meet expected demand. “The hardest part right now is logistics,” he said, adding that he expects demand to remain high through the fourth quarter.

Larry Fulop, vice president of marketing and technology for Tempe, Ariz.-based solution provider MicroAge, said, “We continue to see a very positive pipeline going forward. They continue to work with us where they can and have been as good as competitors [working with the supply chain issues].”

Fulop said he’s hopeful sales will remain strong as the workforce continues to embrace a hybrid working environment. “Lenovo is in a good position for hybrid work,” he said. MicroAge is also a Platinum Lenovo partner and has more than 200 employees.

Lenovo highlighted strong results from its Solutions and Services Group (SSG), Infrastructure Solutions Group (ISG) and Intelligent Devices Group (IDG), which produced third-quarter revenue of $1.5 billion, $1.9 billion and $1.4 billion, respectively. SSG covers the company’s IT services offerings, which has begun to focus heavily on as-a-service offerings. ISG encompasses Lenovo’s cloud services offerings, which grew by 38 percent year over year.

“Once again, we have shown that Lenovo’s innovation, transformation strategy and strong execution can consistently deliver sustainable profitability increases for the future,” Lenovo’s Yang said.