Lenovo, the Chinese giant that plays by the rules … and loses

by Volker Weber

But Lenovo’s accounts show the smartphone business has lost money every quarter since the takeover – in total, nearly $2bn. Early in March, half of Motorola’s 380 engineering staff at its Chicago offices were let go. China’s Huawei, another big tech player, has raced past Lenovo to become No 3 in smartphones globally; Lenovo is almost out of the top 10, selling 17% fewer phones than in 2014 while the market has grown 15%.

I wonder how long this is going to go on. Lenovo makes some interesting midrange phones, but they struggle to make money and keeping them up-to-date at the same time. Marketing knows they need monthly updates for all their devices, but a shrunken engineering cannot deliver. Something will have to give.

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Comments

Midrange has no margins. Won't work.

Thomas Cloer, 2018-05-24

For the phones I buy for my friends in Cuba I usually default to the Moto-Series - it seemed to combine a usable build quality with good prices. Updates are not an issue over there (nobody does it). Maybe my next default would be Nokia?

Frank Quednau, 2018-05-24

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