Large inventory of components should help mitigate the impact of shortages on Lenovo’s business

Lenovo’s executive vice president and chief financial officer Wong Wai Ming, as noted by the Nikkei Asian Review, announced the company’s methodical work to stockpile critical components. By the end of December, Lenovo’s inventory value was up 45% from the prior year to $ 5.79 billion.

Lenovo President and COO Gianfranco Lanci acknowledged that manufacturing constraints remain, but its status as the largest PC maker allows the company to gain privileges in negotiations with suppliers. Lenovo manages to control these risks; the shortage of PC shipments is so far affected to a minimum extent. The life cycle of laptops and tablets, according to company representatives, will be shortened in a pandemic, as the devices have begun to be used more intensively, they will require replacement sooner than in previous years.

Lenovo increased its PC market share by half a percentage point to 25.2% in the fourth quarter, according to IDC, while HP Inc. is forced to limit itself to 20.9% of the market instead of last year’s 23.7%. Worldwide PC sales rose 26.1% to 91.6 million last quarter, with Lenovo outperforming the market by 29%. Revenue increased by 22% to $ 17.25 billion, net income – by 53% to $ 395 million, in both cases the record was updated. Lenovo shares in Hong Kong after the publication of quarterly reports reached a six-year high in price, having risen in price by 4.6%.