13th August, 2015
China’s Lenovo Group, the world’s biggest Personal Computer (PC) maker, announced on Thursday that it is set to lay off about 3,200 employees after profits more than halved in the second quarter of 2015.
The job cut, which will be conducted in the company’s non-manufacturing work force, accounts for about 10 per cent of the non-manufacturing headcount.
According to a statement sent to the Hong Kong Stock Exchange where the company is listed, the cut will also represent five per cent of its total employees globally.
Lenovo saw profits attributable to its equity holders slumped 51 per cent year-on-year to 105 million dollars for the three months through June, the first quarter of the company’s fiscal year 2015/2016.
It has vowed to reduce expenses by about 650 million dollars in the second half of the fiscal year by realigning its businesses, accelerating expansion in the PC market and improving efficiency.
Revenues rose three per cent year-on-year to 10.7 billion dollars in the second quarter, with PC business contributing 7.3 billion dollars, down 13 per cent year-on-year.
The company said it sold 13.5 million PCs worldwide, a decline of seven per cent year-on-year.
Experts say the industry was affected by factors such as currency fluctuation and weaker demand ahead of the release of Windows 10, the latest Windows operating system which came into use in late July.
Revenues from mobile business jumped 33 per cent year-on-year to 2.1 billion dollars, helped by the company’s purchase of Motorola’s mobile business in October.
Lenovo said in the statement that Smartphone sales grew two per cent year-on-year to 16.2 million in the second quarter, while tablet shipments rose four per cent year-on-year to 2.5 million