February 3, 2016
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Project Tango Lenovo logo2

Lenovo’s acquisition of Motorola has led to some major changes at the company, including a notable shift in how the two will be branded. The purchase also cost Lenovo a handsome sum at $2.91 billion, but the company’s mobile division is now on the cusp of making money again.

In total, Lenovo has announced a $300 million net profit for Q3 2015 and the company’s mobile division is also almost back to making a profit after some major restructuring. Lenovo stated that it would take four to six months to return the division to a profit after purchasing Motorola.

Looking at mobile, shipments have fallen by 18.1 percent over the year resulting in total sales of 20.2 million units. This is partly due to a halt in the Chinese smartphone market, which barely grew at all last year. Lenovo has been improving its performance outside of China though, with other sales growing 15 percent year-on-year and sales in India up a huge 206 percent. Motorola has been doing well too, with a 25 percent jump in sales quarter-to-quarter.

In terms of cash, Lenovo’s Q3 revenue came in at US$3.2 billion from its mobile division, of which US$2 billion was contributed by Motorola. The company made a small pre-tax loss of US$30 million, an improvement on the $217 million loss in the previous quarter. The division managed to break even in terms of operating costs, only amortization pushed the group into a small loss.

See also:

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January 14, 2016

Other aspects of Lenovo’s business are rather mixed. Its PC group continues to slump, with PC profits declining 18 percent from last year, falling to a US$405 million. Although that is still a pre-tax profit for the division and the company still leads the industry with a 21.6 percent market share. The company’s enterprise division saw an 8 percent year-on-year sales boost, but still posted a small loss of US$14 million.

With a return to profitability, all eyes will now be firmly focused on the products coming out of the combined Lenovo and Motorola smartphone division.

Robert Triggs
Lead Technical Writer at Android Authority, covering the latest trends in consumer electronics and hardware. In his spare moments, you'll probably find him tinkering with audio electronics and programming.
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