Technology China’s Lenovo sinks to biggest quarterly loss as restructuring bites

China’s Lenovo sinks to biggest quarterly loss as restructuring bites

Lenovo worlds largest PC seller
Lenovo worlds largest PC seller

China’s Lenovo Group Ltd (0992.HK) reversed into its biggest-ever quarterly loss in the July-September period, soaking up acquisition and restructuring costs to cope with tepid demand in the global personal computer and smartphone markets.

The world’s biggest maker of personal computers said on Thursday it booked a net loss of $714 million (469 million pounds) for its fiscal second quarter, compared with a net profit of $262 million a year ago. Though hefty, the loss was narrower than the $787.8 million analyst expected, according to Reuters Smart Estimates.

Beijing-based Lenovo last year made two multi-billion-dollar acquisitions – for Google Inc’s (GOOGL.O) Motorola handset unit and IBM’s (IBM.N) low-end server business – in a response to the shrinking global market for personal computers.

The company said earlier this year it would book a one-off charge of about $900 million in smartphone inventory clearing and restructuring costs in the second quarter. It plans to cut about 3,200 non-manufacturing jobs this year.

The company said in a filing to the Hong Kong stock exchange it expects the realignment moves to generate cost saving of $1.35 billion on an annual basis.


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