Afrigather Lenovo Group Ltd. shares
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jumped in early commerce on Monday, as traders shrugged off the most recent drop within the Chinese language expertise large’s quarterly revenue and seemed ahead to an anticipated rebound later within the 12 months.
The inventory has gained as a lot as 7.2% and was final up 5.3% at 7.14 Hong Kong {dollars} (US$0.91).
The rally got here after Lenovo, the world’s largest personal-computer maker, on Friday posted a 32% revenue drop for its fiscal third quarter, as PC gross sales fell amid weak client spending and declining electronics demand globally. The underside-line decline was narrower than some analysts’ expectations.
The corporate’s chief govt, in an interview with The Wall Road Journal on Friday, guided for resumed industry-wide gross sales development from the second half of 2023, which might assist Lenovo’s earnings rebound. World PC gross sales quantity fell 16% final 12 months, the sector’s worst gross sales drop in over a decade, in keeping with market analysis firm Canalys.
Analysts additionally pointed to the relative resilience in Lenovo’s non-PC companies, together with server and IT-solutions operations. “Server and options would stay as the intense spots, serving to to mitigate PC weak spot,” Citi analysts stated in a observe. The 2 segments each delivered record-high income in the course of the October-December quarter.
“We expect additional draw back could possibly be restricted, and a possible demand stabilization and margin restoration from 2H 2023 would function constructive catalysts,” the Citi analysts stated.
