DUBAI Nov 14 Lenovo Group Ltd, on
track to become the world's top PC maker, has bolstered its
presence in Europe, the Middle East and Africa (EMEA) and aims
to raise regional operating margins by about 50 percent, a top
company executive said on Wednesday.
The Chinese company's profit growth slowed in the second
quarter, although it beat expectations and outpaced results from
its main rivals, such as Hewlett-Packard Co, Dell Inc
and Acer Inc.
Yet uncertainty over the future of the PC market - seen by
some analysts as a 'sunset' industry - has spurred Lenovo to
expand into mobile computing and smart phone handsets.
The company's operating margin in EMEA was 2 percent in the
second quarter and it aims to raise this to 3 percent "in the
next 18 months - by the end of the next financial year",
Gianfranco Lanci, Lenovo president for the EMEA region, told
He said these gains were achievable because the company had
already beefed up its operations in the Middle East, Eastern
Europe and the former Soviet Union.
"It's a matter of scaling expenses. We have the right set
up," he said. "We can see growth coming without adding too much
in terms of resources. We still need to look into how we can
invest in branding."
Lenovo's smartphones, such as LePhones, have gained traction
in China with the PC maker ranking second in market share in the
second quarter, behind Samsung Electronics, IDC data
The Chinese manufacturer launched smart phones in Russian
speaking countries this month, the first time these handsets
have been sold in the EMEA region.
"When you look at all the localisation and approvals you
need to do, you go with the big countries first," said Lanci.
"We are number one in Russia (in PC sales) - we start to see
a strong brand, a strong presence and this is important when we
look at smart phone launch."
Lenovo sells 15 to 20 different smart phone handsets in
China and will select four to five mid to high-end models to
sell in Russia.
Lanci said the company would also look to launch smart
phones in other emerging markets within EMEA.
"It's not going to be Western Europe - we have a stronger
presence in emerging markets than mature markets," he added.
"Western Europe is a market very driven by (telecom)
operators - in emerging markets it's open, there is no subsidy.
It's a totally different business model."