Personal computer-maker Lenovo showed strong profits in first quarter (Q1) earnings, which rose 64% to $173m (£132m), beating market expectations.
The Chinese company noted that it showed high profits in PC business despite a slowdown in the overall market. However, the revenue fell to 6% from a year earlier to $10.1bn in the three months to June.
The company also reported that it received a $132 million gain from the sale of a Beijing office property that has increased profit beyond the $130.1 million average estimate of analysts polled by Thomson Reuters SmartEstimates.
“We can completely turn the business around,” Chairman and Chief Executive Officer Yang Yuanqing told Reuters in an interview.
He also noted while ramping up marketing expenses that Lenovo is now focusing more on the lucrative premium smartphone sector.
The company is planning to cut costs and to spend more on new growth areas such as cloud computing.
When it comes to the smartphones, he told that they will leverage the most innovative, unique products and continue to shift to higher price brands in order to boost huge growth and turnaround this business.
And in datacenters, they will also continue to expand in hyper converged technology and also to improve profitability in the hyperscale business.
The gross profit of company for the first fiscal quarter has dropped 7% year-over-year to US$1.5 billion, with gross margin at 15.3%, according to Lenovo.