Higher Memory Chip Prices a Lingering Concern for Lenovo — Market Talk

Higher memory chip prices is a lingering concern for Lenovo's business, UOB Kay Hian analysts say in a research note. The brokerage downgrades Lenovo's stock to hold from buy amid limited visibility of any resolution in memory chip price hikes in the near term, they say. It also lowers the target to HK$10.60 from HK$12.70. Still, the analysts reckon Lenovo is among best-positioned players within the consumer electronics supply chains to weather the memory chip shortage. "Lenovo will be able to achieve share gains through the memory cycle thanks to its capabilities to secure enough component supplies," they say. The PC maker's cost-cutting measures should also help maintain a relatively stable operating margin. Shares are last at HK$9.79. (sherry.qin@wsj.com)

Lenovo's fiscal 2026 PC revenue growth could be supported by strong volume growth and higher average selling prices, CGS International analyst Ray Kwok says in a research note. CGS International raises its PC revenue forecast for Lenovo to 12% from 7% in fiscal 2026, thanks to strong PC sales as commercial demand recovers and AI PC penetration accelerates. The brokerage also lifts its fiscal 2026-2028 earnings per share estimate by 2%-3%, on stronger AI PC shipments and higher services and solutions revenue forecasts. While maintaining an add rating, CGS International lowers its target price to HK$12.6 from HK$13.80, citing concerns over rising memory costs, which could hurt margins. Shares last ended at HK$9.68. (sherry.qin@wsj.com)

NORTHAMPTON, MA / ACCESS Newswire / November 20, 2025 / For the ninth consecutive year, Lenovo's Love on Month of Service (LMOS) continues to grow in both community impact and employee engagement

By Sydni Behm, Global Program Manager, Lenovo Foundation

For the ninth consecutive year, Lenovo's Love on Month of Service (LMOS) continues to grow in both community impact and employee engagement. During LMOS, employees around the world are encouraged to give their time and energy to issues that impact their local communities, often focusing on access to education and technology. The program empowers employee project leaders to design and lead service projects that reflect local needs and engage their local colleagues in giving back. After launching in 2017, LMOS has become a cornerstone of Lenovo's corporate citizenship, philanthropic efforts, and employee culture.

Each year, Lenovo aims to grow the program by at least one measurable metric - whether it's amount of volunteers, time spent volunteering, number of beneficiaries, or offices engaging around the world. In 2025, the global corporate citizenship team was thrilled to see significant expansion across every measurable metric!

A staple of LMOS is its employee-led model. Lenovo provides resources and support, but the ideas, energy, and execution come from its people. This year, more than 160 unique projects took place around the world and online, each tailored to the needs of a community.

Project leaders in 81 office locations contributed nearly 22,000 hours of volunteer work through 5,636 instances of service. As a result, 90,673 community members received direct support. These numbers reflect not only the scale of the program, but also the deep commitment of Lenovo's workforce to making a difference.

This growth was fueled by a wide range of volunteer experiences, including digital inclusion, education, sustainability, and support for people with disabilities-themes aligned with the company's vision of providing Smarter Technology for All.

In Amsterdam, Lenovo employees joined the Football for All program, partnering with Sport Club Only Friends to raise awareness about accessibility in sports. Volunteers participated in inclusive football activities designed to highlight the importance of adaptive equipment and welcoming environments for players of all abilities.

"It was eye-opening to experience the game from a different perspective," said Santiago Mendez Galvis, Head of EMEA Corporate Citizenship. "Accessibility isn't just about infrastructure, it's about empathy, understanding, and making sure everyone feels welcome on the field."

In Argentina, Lenovo employees partnered with United Way Argentina to restore an educational center serving low-income youth. The project included painting and beautifying the outdoor space.

"There's a deep sense of pride in seeing employees from across teams come together for a shared purpose," said Alice Damasceno, Director of Corporate Citizenship for Latin America. "Giving back to the community isn't just something we do, it's part of who we are."

Across multiple cities in China, Lenovo employees joined students for immersive, hands-on learning experiences focused on technology, STEM, and AI. Activities ranged from robot-building workshops, fossil exploration, guided tours of Lenovo offices, and more, where students learned about innovation and career paths in tech.

In North Carolina, Lenovo employees organized a community bike tour to raise awareness and funds for local nonprofits. The event culminated in a hands-on volunteer activity where teams assembled and donated bicycles to students at a nearby school, promoting both mobility, independence, and fun.

"When we connect our passion for service with real community needs, the results are powerful," said Libby Richards, Senior Community Engagement Manager at Lenovo. "This project gave our employees a chance to get active, give back, and directly support students in a way that's both meaningful and memorable."

In Indonesia, Lenovo employees planted nearly 1,000 mangrove trees along coastal areas in partnership with local environmental organizations. The initiative aimed to support biodiversity, prevent erosion, and contribute to climate resilience in vulnerable ecosystems.

"Mangroves are nature's protectors, they shield coastlines, nurture marine life, and absorb carbon," said Pratima Harite, Head of Corporate Citizenship for Asia Pacific. "Our employees in Indonesia embraced this initiative as a powerful act of environmental stewardship. Their wholehearted participation reflects Lenovo's deep-rooted culture of giving back-where every action is driven by purpose, and every effort contributes to building resilient communities and a healthier planet."

Beyond community impact, LMOS strengthens Lenovo's employee culture. Employees report feeling more connected, engaged, and proud to work for a company that values giving back. The program also supports mental well-being and fosters collaboration across business units, functions and teams.

As LMOS continues to grow, Lenovo is committed to reaching and deepening the programs' impact. We look forward to Lenovo's 10th Love on Month of Service in 2026, celebrating impact and what is possible when innovation meets empathy.

Love on! (If you didn't notice, that's an anagram of Lenovo!)

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SOURCE: Lenovo

View the original press release on ACCESS Newswire

Revenue hit a record US$39.3B, up 18% year-over-year, with net income up 40% to US$846M. All business groups and geographies saw double-digit growth, driven by AI-related products and services, while margins expanded and cash flow strengthened.

Original document: Lenovo Group Limited [992] Interim report — Nov. 20 2025

By Sherry Qin

Lenovo Group reported record quarterly revenue as the world's largest PC maker continued to grow its consumer-electronics and infrastructure businesses, supported by AI adoption and replacement cycle tailwinds.

Revenue for the three months ended September rose 15% to $20.45 billion, exceeding a market consensus of $20 billion. Net profit fell 5% to $340 million, missing the $382 million expected in a FactSet poll of analysts. Excluding noncash and nonoperating effects, adjusted net profit increased 25% to $512 million, the company said.

Demand for artificial-intelligence products continued to drive growth for Lenovo, with AI-related sales accounting for 30% of total revenue in its second quarter, up from a 17% share a year earlier.

Lenovo's main business, the intelligent-devices segment that includes personal computers, smartphones and tablets, posted a 12% rise in revenue for the period. The global PC market has maintained strong momentum, helped by the Windows 11 transition.

The company ramped up sales of AI PCs, which made up one-third of its computer shipments in the September quarter. Lenovo grew its PC shipments by 17% in the July to September period to 19.4 million units, bringing its market share to 25.5%, according to IDC data.

However, the PC maker's results come as memory-chip prices are surging, hitting a whole host of companies, and could drag on its bottom line. Strong demand, driven by the AI boom, has led to a shortage in DRAM, used in processing devices such as computers and GPUs, causing prices to rise sharply.

With AI-related demand still robust, markets expect further rounds of memory-chip price increases through 2026, UOB analysts wrote in a note. The PC maker is unlikely to pass all its additional costs to consumers, they said.

In the latest quarter, revenue from the company's infrastructure-solutions business, which includes AI servers, climbed 24%. The segment remained in the red, however, which the company attributed to increased investments to scale AI capabilities and expand the AI infrastructure portfolio.

Analysts view Lenovo as well-positioned to ride China's AI infrastructure growth. The country's server market is estimated to reach over $140 billion by 2029, with Lenovo's share of the market exceeding 20% by 2028, according to DBS analyst Jim Au.

Shares in Lenovo rose on Thursday after the earnings release amid broad gains in Asian tech stocks, fueled by Nvidia's better-than-expected results overnight.

Write to Sherry Qin at sherry.qin@wsj.com

By Sherry Qin

Frenzied investing in artificial intelligence has fueled talk of a dot-com-like bubble, but Lenovo's CEO says those worries are overdone.

What will be a cause for concern is the shortage of chips caused by the breakneck adoption of AI, which shows no signs of slowing, Yang Yuanqing told The Wall Street Journal.

The maker of computers, smartphones and tablets has cashed in on the AI boom, posting record-high revenue for its most recent quarter. AI-related earnings made up 30% of total revenue.

Yang, who first become the PC maker's chief executive in 2001, thinks the AI gold rush is here to stay.

"AI is definitely the future trend," he said.

He likened the rise of AI to the early Internet era, when the then-new technology laid the groundwork for explosive growth in personal computers, and later, smartphones. Like the Internet, AI too will become "democratized," the executive said.

As AI becomes more accessible to consumers and business, appetite for AI-powered electronics will keep growing. That's good for Lenovo, but only if the supply of memory chips needed to build its products keeps pace with demand.

The speed of AI adoption is already squeezing supplies of the memory chips used in all electronics, with semiconductor makers allocating increasingly more resources to ones used in AI accelerators.

Prices of dynamic random-access memory chips--a core part of virtually all consumer electronics--surged over 25% in the third quarter of this year from the previous one, UOB analysts estimated in a report. They expect another more-than 20% jump in the fourth quarter.

As AI infiltrates industries, the memory-chip supply shortage could become a longer term problem, said Yang, seeing a risk that it will drag on next year.

The Lenovo CEO adds his voice to a chorus of executives cautioning about chip scarcity.

The president of Chinese electronics giant Xiaomi, Lu Weibing, has warned that the company could need to raise smartphone prices next year. The president of semiconductor foundry SMIC--the biggest contract chip maker in China--said shortages could constrain production of consumer electronics in 2026.

While Lenovo might consider adjusting prices of its consumer products, it has to stay competitive, said Yang. Part of that will involve leveraging its supply chain to bring down material and component costs to offset higher spending on memory chips, he said.

The chief executive remains confident that Lenovo can deliver double-digit revenue growth in both its PC and infrastructure businesses, given its solid relationships with key memory suppliers like Samsung and the long-term contracts it has already locked in.

Even with supply constraints, AI will keep being a tailwind for the Hong Kong-listed company, Yang expects.

Lenovo's stock rose alongside other tech and AI-related shares in Asia Thursday morning as earnings from Nvidia overnight offered markets some reassurance that AI demand remains on solid footing.

AI PCs accounted for a third of Lenovo's total computer shipments in the September quarter, topping its forecasts. As the company ramps up AI PC sales, the segment will keep being a key growth driver, Yang said.

Revenue growth at Lenovo's infrastructure and solutions business, which includes AI servers, slowed but Yang said that isn't a reflection of waning demand. At 23%, the segment's revenue expansion is still "pretty strong," he said, adding that he has a roadmap to improvement.

Lenovo's chief financial officer, Winston Cheng, said the unit is continuously bringing in new customers.

The company also stands to gain from China's bid for technological prowess, particularly in the context of competition with the U.S., analysts say.

Beijing's push for AI dominance is spurring Chinese companies to look for domestic suppliers of products like servers, said analysts at Macquarie, naming Lenovo as one of their top picks in tech hardware and networking.

DBS analyst Jim Au estimates that by 2028, Lenovo will have an over 20% share of China's server market.

Write to Sherry Qin at sherry.qin@wsj.com