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* Q3 net profit up 33.5 pct at $204.9 mln, vs consensus
* Mobile phone sales in China surge
* Shares rose 36 pct in 2012 vs index's 23 pct rise
By Lee Chyen Yee
HONG KONG, Jan 30 China's Lenovo Group Ltd
, on track to become the world's top maker of personal
computers, reported a record quarterly profit, up by a third
from a year earlier, as it gained more share in the PC market
and made inroads in the smartphone business.
The ThinkPad maker, also China's No. 2 smartphone vendor,
said on Wednesday net profit in its October-December third
quarter had risen to $204.9 million. That beat the average
estimate of $178.4 million in a Thomson Reuters I/B/E/S poll of
11 analysts and exceeded its previous record of around $172
million in the three months ended December 2007.
Lenovo has rapidly gained market share in the PC sector on
the back of acquisitions over the past few years. The company
trails Hewlett Packard Co by a slim margin in PC
shipments, according to technology research group IDC.
As PC demand growth slows, Lenovo has been diversifying into
the mobile device sector to tap robust demand for smartphones
and tablets, particularly at home in China, the world's biggest
market for mobile phones and personal computers.
"In my opinion, Lenovo's strategy in mobile devices is that
it will focus initially on the overseas markets that it's most
familiar with and this includes emerging markets," Eve Jung, an
analyst at Nomura Equity Research.
"However, it will face challenges in the sector as companies
like Acer and Asustek roll out cheaper tablet PC models to
aggressively target markets, such as China, which is Lenovo's
traditional stronghold," she said.
In the third quarter, overall revenue grew 12 percent from a
year earlier to $9.4 billion, with the bulk coming from its PC
About a tenth of its revenues were from its mobile internet
and digital home (MIDH) business - mainly consisting of its
smartphone sales in China, which jumped 77 percent to $998
The company said its China smartphone business achieved
profitability for the first time during the quarter.
Shares of Lenovo rose 36 percent in 2012, outpacing a 23
percent rise in the Hang Seng Index and beating rivals
Hewlett Packard, Dell Inc and Acer Inc, whose
stocks fell last year.
On Wednesday, Lenovo shares closed down 2.7 percent prior to
the results announcement, compared with the Hang Seng's 0.7
(Reporting by Lee Chyen Yee; Editing by Chris Gallagher)