Though its core PC business is “solid and profit stable,” Lenovo admits that its mobile business has experienced a bit of a rocky patch recently, in its full year 2015/16 results.
The company’s release candidly states that its mobile sales results and growth “show integration efforts did not meet expectations.”
To be fair, expectations were high. In the October 2014 press release reporting that Lenovo had completed its acquisition of Motorola, Lenovo CEO Yang Yuanqing states: “Today we achieved a historic milestone for Lenovo and for Motorola – and together we are ready to compete, grow and win in the global smartphone market. By building a strong number three and a credible challenger to the top two in smartphones.”
Instead, global research firm IDC recently reported that Motorola dropped from the top five global smartphone manufacturers, replaced by fellow Chinese manufacturers Huawei, OPPO and Vivo.
In its release, Lenovo points to losing Chinese market shares as one of the biggest issues of the past year.
“In particular, China shipments declined 85 percent as the business shifted focus to open market and higher price bands,” it says, adding, “and product transition in North America was not successful.”
Lenovo follows up its honest disappointment with a determination to get back on track, saying that it has “learned a great deal” since the Motorola acquisition and is applying those learnings quickly.
Among the changes being made: two new co-presidents, one focusing on China, and one on the rest of the world.
In China, which Lenovo considers the most competitive market, it intends to leverage its ZUK brand to rebuild its “end-to-end competitiveness.”
In the rest of the world, Lenovo wants to maintain high growth in emerging markets, such as India and Brazil, where the new Moto G4 line launched first, and in the U.S. it wants to get back on track with a competitive product line-up.
Looks like its first move is the Moto Z, which leaks show to be an ambitious modular offering. The public is expected to get their first glimpse of the phone at the Lenovo Tech World conference on June 9th, 2016.
Related reading: Lenovo’s Moto G4 Plus and G4 Play are coming to Canada this summer