The gross profit lifted 3 percent to USD 2.25 million, though the margin slipped a bit to 15.5 percent from 16.1 percent. The operating profit went higher by 28 percent to USD 565 million. Lenovo noted that despite the virus crisis, the PC and Smart Device (PCSD), Mobile Business Group (MBG) and Data Center Group (DCG) businesses all grew their revenues together in Q2, for the first time in six quarters.
Lenovo will distribute an interim dividend of HKD 0.066 in December, for a total of USD 102.3 million. This compares to a total of USD 96.6 million the year earlier.
Revenues, profit also rise in H1, despite sluggish demand at the mobile business
For the first half, revenues went up also 7 percent, to USD 27.87 billion, with the net profit rising 44 percent to USD 523 million. Revenues at the Intelligent Devices Group (IDG), made up of the PC and Smart Devices (PCSD) and Mobile Business Group (MBG) businesses, grew 6.1 percent to USD 24.77 billion. PCSD alone lifted revenues 8.8 percent to USD 22.06 billion, pushed by strong demand, with the pre-tax profit rising 23 percent, and a record-pre-tax profit margin of 6.3 percent.
At MBG alone, revenues in H1 declined 13.3 percent to USD 2.61 billion, on a market still sluggish from the pandemic. Revenue rebounded in Q2, rising 39 percent from the previous quarter and 0.6 percent from the year before, with pre-tax losses narrowing by 25 million. The revenue contribution form 5G models more than doubled quarter-on-quarter in Q2.
Revenues at the Data Center Group (DCG) climbed 15 percent to USD 3.09 billion, driven by a new sales record in the cloud service provider business, itself boosted by a surge in cloud demand. Pre-tax losses narrowed here in Q2, on an annual basis.
Finally, invoiced revenue for software and services advanced by 39 percent and contributed 8 percent to group revenue, carrying the highest margin profit among all products.
Looking ahead, Lenovo will for its mobile business look to further push product innovation and accelerate 5G smartphone launches in its stronghold markets. It will also put its attention on growing profits in Latin America, North America and Europe.
