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China's Lenovo reports Q2 loss following cuts

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Baku, November 12, AZERTAC

Chinese technology giant Lenovo said on Thursday (Nov 12) it saw a loss for the second quarter following a restructuring plan, despite stronger sales in its mobile business.

However, the loss reported by the world's biggest personal computer maker was narrower than analysts' forecasts.

"With strong execution, Lenovo acted swiftly and decisively to address challenges, while still delivering better-than-previous-quarter results," Lenovo chairman Yang Yuanqing said in statement on Thursday.

Lenovo had said that it would seek to slash costs by US$1.35 billion annually and cut 3,200 staff from its non-manufacturing workforce - around five per cent of its worldwide headcount, when it announced its first quarter results in August.

"Going forward these actions are intended to drive meaningful run-rate cost savings of about US$650 million in the second half of this year and about US$1.35 billion on an annual basis," the firm said.

Its shares on the Hong Kong stock exchange closed 5.8 per cent up at HK$7.7 (US$0.99) after the quarterly results were announced, while the benchmark Hang Seng Index finished the day 2.4 per cent higher.

Lenovo posted a net loss of US$714 million for the second quarter ending Sep 30, compared to a profit of US$262 million in the same period last year.

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