Lenovo Group, the leading personal computer (PC) manufacturer globally, has unveiled plans to enhance its artificial intelligence (AI) based offerings in the wake of a 3% rise in year-on-year revenues for Q4 2023.
The tech powerhouse based in Beijing, reported an income of $15.7 billion for the December quarter, surpassing the previous year’s figure of $15.2 billion as well as the analysts’ projected average of $15.4 billion. This uplift signals a promising rebound from the company’s successive quarterly sales decline since late 2022. However, the company’s net profit attributable to shareholders dipped to $337 million, a 23% drop from the previous year’s $437 million, though still exceeding the average analysts’ estimate of $309 million.
Lenovo’s CEO, Yang Yuanqing, highlighted the company’s commitment to AI innovation during the company’s earnings webcast, outlining Lenovo’s comprehensive tech stack offerings and collaborations with other AI leaders to harness the potential of AI advancements.
Underlying Lenovo’s AI-focused approach is an expectation of a transition in global PC demand towards devices equipped to locally run AI tasks. Yang suggests that this shift could trigger another industry refresh, given that the new requirement for devices supporting increased creativity and productivity.
According to research firm IDC’s report, by 2027, AI PC shipments, equipped with dedicated semiconductors to facilitate local AI tasks, could soar to over 167 million units. This figure is a significant increase from this year’s projected nearly 50 million and could represent almost 60% of the total global PC shipments by 2027.
Lenovo intends to commence the distribution of its premiere AI PCs in the first half of 2024, expanding its AI device range extensively in the latter half of 2024 through 2025. Simultaneously, Kirk Skaugen, Executive Vice-President, foresees a doubling of Lenovo’s market share in AI servers this year.
On the heels of its commitment in August 2023 to invest $1 billion additionally over three years to expedite global business AI deployment, Lenovo intends to continue to amp up its resources. As part of its post-earnings statement on Thursday, Lenovo reported a more than 25% year-on-year increase in its research and development staffing, signaling what could be a record high R&D expenditure to revenue ratio for the full financial year ending March.
In a landmark association with Chinese internet search titan, Baidu, Lenovo plans to incorporate the latter’s generative AI technology into its new Moto-branded smartphones. Furthermore, Lenovo offered a glimpse into its ‘AI for All’ strategy at the CES trade show in Las Vegas earlier this year, showcasing over 40 novel AI-powered devices and solutions, reinforcing its push for AI.