Lenovo Vows To Raise Game

The Purchase, N.Y., PC maker reported a profit of $47 million for its quarter ended Dec. 31 and 12 percent growth vs. the year-earlier quarter. However, some analysts had predicted as much as a 40 percent growth in profits.

Sluggish sales in Japan, and an effort to grow SMB revenue worldwide, took a bite out of Lenovo&'s profits, executives said. However, it was the third quarter of profitability since the acquisition of IBM&'s PC business last year.

Overall, Lenovo turned in sales of 31.1 billion Hong Kong dollars, or $4 billion U.S. The company reported its results during a meeting with analysts in Hong Kong, which was Webcast.

“We need to raise the game with respect to our competitive standard,” said William Amelio, Lenovo&'s CEO. “In this industry, it&'s required for us to be best-of-breed when it comes to operational efficiency. We have to be able to support our business partners and customers in all areas of the world.”

Solution providers said they have seen little fallout in the United States from the Lenovo-IBM integration and, of late, sales have been stable. That dovetails with Lenovo executives&' remarks that U.S. ThinkPad business was brisk.

“In my experience, [the ThinkPad and ThinkCentre] business is very strong,” said Roger Choate, president of Choate Technology Partners, a Paducah, Ky., Lenovo solution provider.

But a distribution executive, who asked not to be named, said he&'s concerned about Lenovo&'s SMB strategy. “I don&'t think they&'ve addressed their biggest challenges, including the lack of an SMB business plan. They do very well in large enterprise, midmarket categories, but historically—even before the split—they never had a sustainable solution for SMB,” he said.

SCOTT CAMPBELL contributed to this story.