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The profit headline requires more care. Reported net income attributable to Lenovo shareholders was US$505 million, up 108%. Lenovo’s non-HKFRS adjusted net income was US$389 million, up 22%, after excluding mainly non-cash fair-value effects tied to warrants and convertible bonds.
What Lenovo reported
| Metric | Q1 FY2025/26 | Year over year |
|---|---|---|
| Group revenue | US$18.830 billion | +22% |
| Prior-year revenue | US$15.447 billion | — |
| Pre-tax income | US$622 million | +99% |
| Reported net income attributable to equity holders | US$505 million | +108% |
| Non-HKFRS adjusted net income | US$389 million | +22% |
| Basic earnings per share | 4.12 US cents | +107% |
These figures come from Lenovo’s official earnings release. The company’s separate financial-results release identifies the period as the first quarter of fiscal 2025/26, rather than calendar-quarter results.
For investors, the distinction between the two profit measures is material. The US$505 million figure is the reported HKFRS result. The US$389 million figure is an adjusted, non-HKFRS measure that removes non-cash valuation movements associated with Lenovo’s warrants and convertible bonds from its strategic collaboration with Alat. Management has said those valuation effects may continue to affect reported results through fiscal 2027/28, so adjusted profit is useful when assessing operating progress.
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PCs still supplied the largest engine
Lenovo’s Intelligent Devices Group (IDG) generated approximately US$13.5 billion in revenue, up nearly 18%. Within that group, PC and smart-device revenue rose 19%—the fastest growth rate Lenovo said it had reported for the business in 15 quarters.
- Lenovo reported a record 24.6% global PC market share and said its lead over the second-place vendor widened.
- The PC business maintained operating profitability above 8%, according to the company.
- Growth reached every geography, with CEO Yuanqing Yang highlighting a return to rapid double-digit growth in China.
- Lenovo said more than 30% of its PC shipments were AI PCs and that it held 31% of the global Windows AI PC segment.
The market-share and AI-PC figures are Lenovo’s own reported measures, not independent estimates. Revenue growth also cannot be equated with unit growth alone: share gains, product mix, pricing and AI-capable models may all contribute.
Infrastructure and services made the quarter broader
Infrastructure Solutions Group
The Infrastructure Solutions Group (ISG) produced approximately US$4.3 billion of revenue, up 36%. Lenovo said AI-infrastructure revenue more than doubled year over year, supported by demand from cloud-service providers as well as enterprise and small-business customers.
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Solutions and Services Group
The Solutions and Services Group (SSG) reached a record US$2.3 billion, up 20%. Lenovo cited double-digit growth in support services and infrastructure-as-a-service. Non-PC businesses accounted for 47% of group revenue, nearly half a percentage point more than a year earlier.
That mix is strategically important. Services can create a more recurring revenue stream than one-time hardware sales, although the quarter does not by itself establish how much of Lenovo’s services revenue is recurring or how profitable each contract is.
Smartphones
Lenovo said smartphone revenue grew more than 14% to approximately US$2.2 billion. Motorola’s Razr line was a major contributor, and Lenovo said smartphone sales volume had outgrown the market for eight consecutive quarters. It also claimed the number-one position in foldables outside China, with more than 50% share. Those rankings are company claims for the markets and period described in Lenovo’s release.
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What AI contributed—and what it does not prove
AI appeared in two different parts of the result. In PCs, AI-capable devices helped Lenovo participate in a new product cycle and the company reported that more than 30% of its shipments qualified as AI PCs. In enterprise technology, ISG’s more-than-doubling AI-infrastructure revenue points to demand for systems used to train and run AI workloads.
Those figures support the conclusion that AI-related products were meaningful growth drivers. They do not prove that AI alone caused the 22% group increase. PC, infrastructure and services all grew, and Lenovo said every sales geography delivered high or relatively high year-over-year growth.
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Lenovo attributed resilience to an operating model designed to combine global scale with local execution:
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- “ODM+” manufacturing: a manufacturing approach that combines Lenovo’s own capabilities with external original-design-manufacturer capacity.
- Diversified supply chain: production and sourcing spread across locations rather than concentrated in one market.
- “Global/Local” operations: global procurement and capabilities paired with local delivery and customer support.
- Continued R&D: research and development spending rose by more than 10% year over year, according to Lenovo.
These measures can reduce disruption and improve responsiveness, but they do not eliminate exposure to component costs, freight, currencies, trade rules or changes in customer demand.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Tariffs and the durability question
Lenovo management said it overcame tariff-related challenges during the quarter. That describes mitigation during this reporting period, not the permanent removal of tariff risk. The company also identified geopolitical uncertainty as an ongoing challenge.
Four tests help put the quarter in perspective:
- Breadth: growth extended beyond PCs, with ISG up 36% and SSG up 20%.
- Quality: both reported and adjusted profit increased, although reported profit was affected by non-cash valuation movements.
- Market position: Lenovo reported a record 24.6% PC share.
- Durability: AI infrastructure, services, market-share gains and supply-chain execution may support future growth, while tariffs, PC cyclicality and uncertain willingness to pay for AI features could slow it.
A strong quarter therefore should not be read as proof that Lenovo has permanently shifted to a higher growth rate. Future reports will show whether demand, margins and cash generation hold after comparison effects and unusual accounting movements fade.
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How to read the result as an investor or customer
Investors should track adjusted and reported profit separately, then examine segment margins, infrastructure demand, services growth and the effect of tariffs and currencies. Revenue growth alone does not guarantee equivalent earnings growth.
Customers can reasonably view the results as evidence that Lenovo is investing across PCs, AI systems, smartphones and services. It is not evidence that every Lenovo product is the best value. Product quality, specifications, support and pricing still require model-specific evaluation.
For product categories, Lenovo’s official laptop page covers ThinkPad, Yoga, IdeaPad, Legion and AI-capable PCs. Enterprise readers can review servers and storage. Current prices, availability, warranties and financing are not established by this earnings report.
Bottom line
Lenovo delivered a genuinely broad first quarter: US$18.83 billion of revenue, record PC share, rapidly growing AI infrastructure and record services revenue. The cleanest interpretation is strong operating momentum across several businesses—not a PC-only surge and not an AI-only story. When comparing future quarters, keep the US$505 million reported profit separate from the US$389 million adjusted figure, and watch whether market-share gains and services growth can offset tariff, margin and PC-cycle risks.
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