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Lenovo PC And Data Center Sales Spike Despite COVID-19

The worldwide PC market-share leader generated $13.3 billion in revenue during its first fiscal quarter, including a boost in data center revenue thanks to high demand for public cloud infrastructure.

Despite the coronavirus pandemic, Lenovo reported significant revenue growth during its first fiscal quarter with data center revenue up nearly 20 percent year over year while PC and Smart Devices revenue reached $10.6 billion.

“Our outstanding performance last quarter proves that Lenovo has quickly regained momentum from the impact of the pandemic and is capturing the new opportunities emerging from remote working, education and accelerated digitalization,” said Lenovo Chairman and CEO Yang Yuanqing in a statement.

The Hong Kong-based PC market-share leader reported 20 percent growth in its Data Center Group by generating $1.6 billion in revenue. Huge data center revenue growth came from a 30 percent year-over-year increase from cloud service providers including Amazon Web Services, Google Cloud and Microsoft Azure, which are clamoring for more public cloud infrastructure for their data centers.

Lenovo’s Data Center Group, which includes servers, storage, networking software and services, has a new global channel leader in Jose Luis Fernandez.

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In an interview with CRN last week, Fernandez said he has bold plans to drive sales opportunities and channel synergies through new joint architectures between its Data Center and Intelligent Devices groups and creating new systems integrator and service provider programs.

“We are building joint architectures in a couple of fields. There’s a remote virtualization tool that’s being developed in partnership with both business units—our Data Center Group and Intelligent Devices Group,” said Fernandez in the interview with CRN. “It’s an opportunity for some of our channel partners to join and participate through professional services as well as their own professional services.”

Also on the data center side, Lenovo North America Channel Chief Steve Biondo has revamped the company’s partner program and channel strategy to win over partner mindshare from competitors like Dell Technologies and Hewlett Packard Enterprise.

“We went out to partners and said, ‘Look, we have better technology than the competition. We have a better price point. We have a partner program now that’s enticing,’” said Lenovo’s Biondi in an interview with CRN. “We’re growing our Platinum partner base by almost 50 percent in one quarter. Why is that happening? Our supply chain is better, we now have a program that’s a lot more meaningful that shows them how they can make money by selling with us, a next-level support strategy and coverage model—our plan is working.”

Lenovo’s bread-and-butter PC and Smart Devices Group (PCSD) grew double digits to $10.6 billion in its first fiscal quarter, driven by a 45 percent spike year over year in consumer business sales. The company’s PCSD group encompasses PCs, tablets, software and services.

Overall, the worldwide PC market-share leader reported total revenue of $13.3 billion, up nearly 7 percent year over year, while net income jumped 31 percent to $213 million.

“While the world continues to face challenges, Lenovo is focused on delivering sustainable growth through our core businesses as well as the new services and solutions opportunities presented by our service-led intelligent transformation,” said Yang.

Lenovo employs 63,000 people globally and has operations in 180 markets around the world.

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