China’s Lenovo has suffered a major setback due to the decline in demand for personal computers (PC). The company’s revenue declined by 24 percent in the June quarter. The world’s largest PC maker is facing decline in sales for four consecutive quarters. The company’s profit was 14 percent less in the last financial year. Lenovo’s revenue in the June quarter was $12.9 billion. After this the share price of the company has decreased by six percent. There was a significant increase in electronics sales during Corona as customers and companies purchased a large number of PCs to shift to remote work. However, last year the company’s revenue started declining due to decrease in demand due to increase in interest rates and increase in inflation. The pace of recovery in PC demand is weak and many retailers are left with unsold inventory. This has forced PC makers and their suppliers to adjust production volumes and rates. There was a 29 percent decline in global shipments of PC in the first quarter of this year. Due to this, American company Apple, which manufactures Mac computers, suffered a big loss. Market research firm IDC reported that global shipments of PC declined to 5.69 crore units in the first quarter. It was Rs 8.02 crore in the same period last year. In the last quarter of last year, these shipments had declined by 28.1 percent on a year-on-year basis. Apple’s shipments declined the most in the first quarter by about 40.5 percent. The decline in shipments for Dell was 31 percent. Apart from this, Lenovo, Asustek Computer and HP also faced decline in shipments in the first quarter. Apple had said that sales of its Mac computers had increased rapidly during the pandemic due to work from home. There has been a 29 percent decline in value terms in the first quarter on a year-on-year basis. IDC had said, “The decline in demand has given device makers an opportunity to make changes in the supply chain. Many companies are exploring the possibility of increasing production outside China.” There is a possibility of slowdown in the economies of big countries. Financial crisis in some big banks and increase in inflation may hamper growth and investment.
Lenovo suffered a big blow due to decline in PC sales, 24 percent decline in revenue.
