The world’s biggest PC maker reported a 24% revenue decline on Thursday, equating to a 66% drop in net income ($177m) for Q1.
As Q1 revenue fell to $12.9bn, below market estimates of $13.8bn, CEO Yuanqing Yang said: “Last quarter, the macro environment presented challenges, and our hardware business remained in a phase of adjustment […] Our non-PC revenue mix of the group revenue further increased year on year.”
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The Covid-19 pandemic saw a tech boom prompted by remote working. The Royal Society of Chemistry estimated in 2021 that 47.8% of UK residents who moved to home working had acquired new IT equipment. Currys PC World reported gaming technology sales were up 121% during the pandemic.
The return to the workplace, coupled with rising interest rates and inflation, have strained demand.
With a market share of 24%, Lenovo remained top of the market for shipments of desktops but suffered an annual decline of 30%, down 12.7 million units.
In second place, HP also saw a drop of 24% to 12.0 million units of shipment, according to research firm Canalys.
In a Thursday blog post, Lenovo renewed its commitment to spend $1bn on AI over three years. By expanding, non-PC businesses, which Lenovo states accounted for 41% of Group revenue, the company hopes to remedy its falling profit margins.
In a statement, the PC maker said it foresees AI creating growth opportunities in future.
