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  • embedded_eng56 embedded_eng56 Jun 5, 2013 5:18 PM Flag

    Levono smartphones

    By JURO OSAWA Wall Street Journal

    HONG KONG—China's Lenovo Group wants to start selling smartphones in the U.S. within a year, its chief executive said, as the company behind the ThinkPad brand tries to repeat the success of its personal-computer business.

    Lenovo is bringing its smartphones to the U.S.

    Lenovo is pushing aggressively into the smartphone market just as the traditional PC industry is struggling with shrinking demand. Consumers are spending more money on mobile devices, and the weak economy is pushing corporate clients to hold off on office PC purchases.

    Even though Lenovo has been outperforming the PC industry with solid sales and improving margins, the company is looking for new engines for its long-term growth. "Smartphones are our new opportunity," said Lenovo Chief Executive Yang Yuanqing in an interview.

    "As a public company you always have to consider how to grow," even when Lenovo's core PC business is strong, he said.

    Despite being a latecomer in the handset market, Lenovo is already the second-largest smartphone vendor in China, closely following market leader Samsung Electronics Co. Lenovo's smartphone market share in China jumped to 11% last year from 4.1% in 2011, according to research firm IDC. Samsung held a 17.4% share

    Since last year, Lenovo has expanded its smartphone business outside China, starting with emerging markets such as India, Russia and Indonesia. Its next challenge is to enter markets like the U.S. and Europe.

    Lenovo's smartphones are expected to face an uphill battle in the U.S. While its brand is a household name for Chinese consumers, the company is still trying to establish itself abroad, especially in the U.S. and other mature markets. Lenovo is close to overtaking Hewlett-Packard Co. HPQ -1.75% as the world's largest PC vendor, but was in only fifth place in the U.S. in the latest quarter with a 9% share, according to IDC.

    Sentiment: Hold

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