Lenovo's share price fell 10%: smartphone business turned losses

Lenovo Group (0992.HK) announced on the 3rd of the third quarter of the 2015/16 fiscal year (as of December 31, 2015) that the revenue was reduced by 8% to US$12.9 billion, excluding exchange rate factors. Then only 2% annual reduction; gross profit margin decreased by 0.3 percentage points to 14.6%; operating expenses decreased by 15% to 1.5 billion US dollars; net profit increased by 19% to 300 million US dollars. According to a survey by Thomson Reuters SmartEstimates, analysts originally expected Lenovo's third-quarter revenue and net profit to be $13.21 billion and $237.7 million.
Lenovo's personal computer business revenue in the third quarter decreased 12% year-on-year to US$8.033 billion, consumer PC market share increased 1.3% to 19.7%, and commercial PC global market share increased 1.6% to 23.4%. The highest record.
Lenovo's mobile business revenue in the third quarter decreased 4% year-on-year to US$3.245 billion, excluding exchange rate factors and increased 5% annually. Lenovo said that the mobile business group improved its operational efficiency through business restructuring and achieved the first operational balance. In the third quarter of Lenovo, the global sales of smart phones decreased by 18% (up 7%) to 20.2 million, and the global market share decreased by 1.5 percentage points to 5.1%, ranking fourth.

In the third quarter of Lenovo, the sales volume of smart machines outside China increased by 15% to 16.7 million, and the overall proportion climbed from 83% a year ago to 83%.
In the first three quarters of Lenovo's 2015/16 fiscal year, China's revenue decreased 14% year-on-year to US$10 billion. In the third quarter, local revenue decreased 14% year-on-year to US$3.52 billion. Lenovo revealed that China's mobile phone inventory has been cleared, and is now rushing to the open market with a broader product portfolio to restore growth.
Lenovo's 2015/16 fiscal year 1-3 quarter net loss of $ 308 million, far less than the net profit of 729 million US dollars a year ago.
IDC announced on January 12 that global PC (PC) shipments in the fourth quarter of 2015 decreased by 10.6% to 71.9 million units; shipments in 2015 decreased by 10.4% year-on-year to 276 million units, the largest decline in history. (Note: surpassing the 9.8% decline in 2013), for the first time since 2008, it has fallen below 300 million integer levels.
Lenovo (see chart) fell 10.19% on the 3rd to close at 6.61 Hong Kong dollars; this year's decline has reached 16.01%.