MORRISVILLE – Lenovo says it had a “record fiscal year,” some analysts have shifted their ratings on the company’s stock as Lenovo shared concerns about a decrease in shipments due to ongoing supply chain considerations during an earnings call.
“Although last year was challenging for the world, with the accelerated global digital and intelligent transformation, Lenovo delivered a record year of profit and revenue,” said Yuanqing Yang, chairman and CEO of Lenovo. “All our main businesses are now profitable for the full year, and our new growth engines – SSG, ISG and Mobile – are showing strong momentum.”
The company reported net income of $2.03 billion for the fiscal year, with $412 million coming in the most recent quarter. Revenues were reported at more than $71.6 billion for the fiscal year and nearly $17 billion in the most recent quarter.
Growth rate slows
But while revenues rose for the quarter—the prior fiscal year, the company reported revenues of $15.6 billion—its growth rate slowed to 6.8%.
Still, the company warned that macroeconomic headwinds and ongoing supply chain shortages as well as a recent lockdown in Shenzhen, where Lenovo operates a factory, due to an increase in the number of confirmed COVID cases.
“Due to the macro economic headwinds, the shortage is weighing significantly in the very short term,” Luca Rossi, executive vice president of Lenovo, told Reuters following the earnings call. “Specifically in this quarter, the manufacturing shutdowns will impact the total shipments in basically everywhere, particularly in the People’s Republic of China.”
JPMorgan Chase & Co., meanwhile, put a rating of “neutral” on Lenovo’s stock on Wednesday, according to reporting from Defense World.
Apple topped Lenovo in a broad measure of device sales during the first quarter of the calendar year, according to a report released earlier this month by Canalys. And while Lenovo did finish 2021 as the top global seller of PCs, the company’s sales slipped at the end of the fourth quarter of the calendar year, according to analysts.
The company is planning to hire some 12,000 research and development professionals, and established a semiconductor company in Shanghai in January in a move the company said would “support our global vision and ambitions.”