As memory prices squeeze enterprise buyers, Lenovo laughs all the way to the bank

PC buyers may be wincing at memory price hikes, but Lenovo isn’t. The China-based tech biz says it sidestepped much of the industry pain by switching to premium devices and the numbers back it up. For Q4 of its fiscal 2026 ended March 31, Lenovo’s Intelligent Devices Group posted revenue of $14.6 billion, up from $11.9 billion a year earlier. It reported operating profit – net profit was not disclosed – of just over $1 billion, up 20.7 percent. PC and smart devices revenues, specifically, grew 26 percent. “Last quarter, despite the supply shortages and rising component costs, we committed to sustaining growth and improving profitability, leveraging our operational excellence,” CEO Yang Yuanqing said on an earnings call. “We promised to maintain our PC revenue momentum despite a slowdown in PC shipments due to rising costs. We delivered. We shifted our mix towards premium to improve average unit revenue, and our PC shipment growth continued to outperform the market,” he stated. PCs accounted for half of Lenovo’s overall group turnover, shipments were up 20 percent year-on-year and the corporation accounted for 24.4 percent global market share. Servers and services comprised the rest of Lenovo’s revenues. The memory crunch has been brutal. Some DRAM and NAND flash prices doubled or quadrupled by early this year, as chipmakers chased higher margins on AI server memory and starved the consumer market of supply. The Register has previously reported how the price hikes led to a spike in PC sales, as corporate buyers brought forward purchases before memory costs climbed any further. Asked whether this had any effect on Lenovo’s numbers, EVP for Intelligent Devices Luca Rossi downplayed it. “So in calendar Q1, our last fiscal Q4, we definitely observed strong demand, which might partially be linked to some pull in, but I don’t think that it will be a substantial number,” he stated. “Definitely, we are seeing some tight supply in certain components, particularly – as you probably know – in the semiconductor area. However, we feel confident about our ability to procure the parts we need and we did not adjust our full year target based on supply constraints. Rather, we will align the shipment target based on the real market and demand in order to maintain a healthy channel inventory and with the goal of maintaining a solid premium to market,” Rossi said. Lenovo expects unit shipments to decline year-on-year for its fiscal 2027. “But at the same time, we expect to maintain or very likely grow our revenue linked to the significant growth of the AUR (average unit revenue),” he added. Squeezing more profit from fewer system sales means availability of cheaper PCs will take a hit as Lenovo shifts production to premium boxes. This isn’t the only impact AI is having on the PC market. CEO Yang pledged to embed the technology across Lenovo’s entire product line, including forthcoming “personal AI super agents” Tianxi and QIRA, plus next-generation AI-native PCs, smartphones, wearables, and “personal computing hubs.” Whether customers want all of that remains, as ever, an open question. Lenovo AI Now or Tianxi is a personal and private AI assistant to help with writing, summarizing, and quick settings for your computer, says Lenovo. QIRA is “your personal intelligence that’s by your side across Lenovo and Motorola devices. It moves with you, learns from you, and helps you get things done.” For those interested in the total financial figures, Lenovo claimed a fourth quarter revenue record of $21.6 billion, up 27 percent year-on-year. It recorded revenue of $83.1 billion and net profit of $1.91 billion for the whole of its fiscal ’26. ®

المصدر: The Register