Record quarterly revenue and rapid AI-driven growth position Lenovo for long-term expansion across devices, infrastructure, and services
Lenovo Group Limited has reported strong financial performance for the third quarter of its fiscal year 2025/26, highlighting record-breaking revenue, expanding profitability, and accelerating momentum driven by artificial intelligence across its business portfolio. The results underscore the company’s evolving strategy to integrate AI into every layer of its operations — from personal devices and enterprise infrastructure to advanced services and solutions — while maintaining steady growth across global markets.
During the quarter, Lenovo achieved total group revenue of US$22.2 billion, marking the highest fiscal-quarter revenue in the company’s history and representing an 18 percent year-on-year increase. All major business units contributed to this performance with double-digit growth, demonstrating balanced expansion across its diversified technology ecosystem. Adjusted net income climbed significantly compared with the previous year, reaching US$589 million — a 36 percent increase — while the adjusted profit margin expanded to 2.7 percent. These results reflect Lenovo’s ongoing efforts to strengthen operational efficiency and invest strategically in emerging technologies.
A central theme behind the company’s strong performance is the rapid rise of AI-related business activities. AI revenue surged by 72 percent year-on-year and now accounts for nearly one-third of total group revenue. This growth has been fueled by increased demand for AI-enabled devices, infrastructure solutions, enterprise services, and hybrid computing environments. Lenovo continues to position AI as a multi-year growth engine, aligning product innovation with enterprise digital transformation and the expanding role of AI in everyday computing.
The company emphasized that its ability to maintain growth while navigating industry challenges — such as supply chain constraints and rising component costs — stems from a combination of innovation and disciplined operational execution. Lenovo’s leadership highlighted that the organization is focusing on hybrid AI strategies designed to bridge personal computing, enterprise solutions, and cloud infrastructure. As AI adoption expands across industries, Lenovo aims to capitalize on opportunities created by the democratization of AI technologies.
To support long-term demand for AI training and inference workloads, Lenovo initiated a strategic restructuring of its Infrastructure Solutions Group (ISG). This transformation resulted in one-time restructuring charges during the quarter but is expected to deliver significant cost savings over the next three years. The initiative focuses on optimizing product offerings, streamlining organizational structures, and enhancing the global sales network. Lenovo anticipates annual savings exceeding US$200 million, enabling ISG to transition toward more sustainable and profitable growth while strengthening its competitive position in the enterprise infrastructure market.
Chairman and CEO Yuanqing Yang described the quarter as a strong demonstration of Lenovo’s ability to deliver consistent performance despite market fluctuations. According to Yang, the company’s focus on innovation and operational excellence allowed it to capture market share while improving profitability. He also emphasized that as AI becomes increasingly embedded in both personal and enterprise environments, Lenovo plans to accelerate investments in hybrid AI platforms that unify devices, infrastructure, and services into a cohesive ecosystem.
The Intelligent Devices Group (IDG), which includes PCs, smart devices, and smartphones, delivered particularly strong results. Revenue for the segment reached US$15.8 billion, growing 14 percent year-on-year while maintaining industry-leading margins. Lenovo’s PC business continued to outperform the broader market, with shipment volumes exceeding industry growth for ten consecutive quarters. The company achieved a historic annual global PC market share of 24.9 percent, with quarterly share rising to 25.2 percent — reinforcing its leadership position in personal computing.
Smartphone performance also contributed to the quarter’s success, as Motorola achieved record activation levels and shipment volumes. Innovation remained a key focus, highlighted by several product announcements at Lenovo Tech World during CES 2026. New launches included updated Aura Edition PCs, advanced ThinkBook designs, gaming-focused Legion devices, and refreshed Motorola foldable smartphones. Lenovo also introduced its ambient intelligence platform, Qira, designed to function as a unified AI system across multiple devices. This concept aligns with Lenovo’s vision of “one AI” seamlessly integrated into a user’s daily digital experiences.
The Infrastructure Solutions Group recorded its strongest quarter to date, generating US$5.2 billion in revenue — a 31 percent increase year-on-year. Growth was driven by strong demand from cloud service providers, expanding enterprise deployments, and rising adoption of AI servers. Lenovo reported a robust pipeline valued at US$15.5 billion for its AI server business, signaling sustained momentum in high-performance computing infrastructure. The company’s Neptune liquid-cooling technology also experienced rapid growth, with revenue increasing threefold compared to the previous year as customers sought more energy-efficient solutions for data center operations.
Partnerships with major technology companies remain an essential component of Lenovo’s infrastructure strategy. At Tech World, the company unveiled new AI inferencing servers and expanded its collaboration with NVIDIA through the Lenovo AI Cloud Gigafactory initiative. These developments aim to accelerate hybrid AI adoption across enterprise environments, public cloud platforms, and specialized AI factory deployments.
The Solutions and Services Group (SSG) also delivered impressive performance, achieving US$2.7 billion in revenue — an 18 percent increase year-on-year and marking 19 consecutive quarters of growth. Operating margins improved significantly, reflecting Lenovo’s transition toward a services-led business model. Growth was particularly strong in sectors such as manufacturing, retail, transportation, and smart cities, where enterprises are shifting from experimental AI initiatives to large-scale production deployments.
Within SSG, managed services and project-based solutions accounted for a growing share of revenue, approaching 60 percent of the segment’s total. Lenovo’s TruScale Device-as-a-Service (DaaS) and Infrastructure-as-a-Service (IaaS) offerings experienced accelerated demand, driven by GPU-intensive workloads and customer preferences for scalable, flexible consumption models. Additionally, the company reported strong expansion in digital workplace services, hybrid cloud solutions, and sustainability-focused offerings, all of which are growing at roughly twice the pace of the broader market.
Innovation within services was further highlighted by the introduction of Lenovo Agentic AI — a new platform designed to help enterprises create and manage AI agents throughout their lifecycle. Alongside this, Lenovo launched xIQ, a suite of AI-native delivery platforms aimed at simplifying deployment and improving operational efficiency. These tools enable organizations to automate workflows, streamline decision-making processes, and achieve measurable business outcomes through advanced AI integration.
Beyond financial performance, Lenovo also shared updates on corporate initiatives and environmental, social, and governance (ESG) achievements. The company strengthened its leadership presence in key regions by appointing a new Senior Vice President to oversee operations across the Middle East, Türkiye, and Africa — reflecting the strategic importance of emerging markets. Lenovo’s commitment to sustainability was recognized through multiple industry accolades, including a fourth consecutive AAA rating from MSCI ESG and leadership recognition in climate and water security from CDP.
Overall, Lenovo’s third-quarter results highlight the company’s transformation into a more AI-centric technology provider. By combining strong performance in traditional hardware markets with rapid growth in infrastructure and services, Lenovo continues to diversify its revenue streams while positioning itself at the forefront of hybrid AI innovation. As the technology landscape evolves, the company aims to leverage its global scale, integrated ecosystem, and strategic partnerships to drive long-term growth and deliver value to customers and shareholders alike.
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