Lenovo Posts 43% Quarterly Revenue Jump to $26.94 Billion Amid AI Boom

Chinese technology group Lenovo announced a 43% year-on-year increase in quarterly revenue on Thursday, citing strong demand for AI-powered devices and global memory chip shortages. The company, the world’s largest personal computer manufacturer, recorded $26.94 billion in revenue for the three months ended 30 June, surpassing analyst forecasts of $22.3 billion.

AI-Driven Growth and Segment Performance

The 43% growth marks Lenovo’s highest quarterly revenue increase in five years. Revenue linked to artificial intelligence rose 60% year-on-year to $9.3 billion, accounting for 35% of total revenue in the first fiscal quarter. Within its PC, tablet, and smartphone division — which contributed approximately 64% of total revenue — revenue climbed 27% year-on-year.

Adjusted net income — excluding non-recurring items and non-cash expenses — more than doubled to $1.075 billion. Research and development spending increased by about 30% year-on-year, according to the company’s earnings report.

Server Line Expansion and Market Demand

Lenovo’s AI server production line reached $5.4 billion in value, a 157% increase from the prior quarter. This surge reflects demand from major cloud computing providers, AI cloud services, and enterprise AI customers.

Net Loss and Accounting Impact

The company reported a net loss attributable to shareholders of approximately $609 million, compared with net income of $505 million in the same period last year. Analysts had expected, on average, net income of $589 million, based on data compiled by the London Stock Exchange Group. Lenovo attributed the loss primarily to a $1.7 billion non-cash fair-value loss stemming from the revaluation of 2025 guarantee bonds.

Stock Performance and Industry Context

Lenovo shares hit an all-time high on Thursday before the earnings announcement. Year-to-date gains totaled 225%, and the stock rose as much as 17% following the results. U.S. rival Dell Inc. (DELL.N) posted similar gains.

Earlier this year, Lenovo had warned of pressure on PC shipments amid a growing shortage of memory chips. In response, the company raised PC prices to offset rising memory costs.