Lenovo Group Reports Record Q4 Revenue and Profit, Capping Best Fiscal Year Ever

Lenovo Group (HKSE: 0992; ADR: LNVGY) announced its fourth quarter and full-year results for fiscal year 2025/26, ended March 31, 2026, delivering record performance. The company reported Q4 revenue of nearly 150 billion RMB, a 27.1% year-over-year increase, marking the fastest growth in nearly 20 quarters and significantly exceeding market expectations. Adjusted net profit for the quarter doubled compared to the same period last year, while net profit under HKFRS was nearly six times higher. For the full fiscal year, revenue reached 589.9 billion RMB, up 20.3% year-over-year, surpassing the 500 billion RMB threshold for the first time. Adjusted net profit grew 42.1%, about twice the rate of revenue growth, setting a new record. Both revenue and adjusted net profit exceeded market consensus.

The strong results come amid supply chain challenges and rising component costs. Lenovo had previously expressed confidence in its operational excellence to maintain growth, and the Q4 figures confirm its ability to deliver. The company's growth was driven by all three business groups: IDG (Intelligent Devices Group), ISG (Infrastructure Solutions Group), and SSG (Solutions and Services Group), each posting double-digit revenue growth in Q4. IDG revenue grew 24% year-over-year, expanding its market leadership. ISG returned to profitability as expected, with operating profit and margin reaching new highs, while revenue increased 37% to a record. SSG achieved its 20th consecutive quarter of double-digit growth, maintaining an operating margin above 20%.

For the full year, IDG revenue rose 17%, with PC market share reaching a record 24.2%. ISG full-year revenue surpassed 136 billion RMB, up 32%, and achieved full-year profitability. SSG revenue exceeded 71 billion RMB, exceeding targets. AI emerged as a core growth engine: Q4 AI-related revenue grew 84% year-over-year, accounting for 38% of total revenue, while full-year AI revenue doubled, up 105%. Lenovo increased R&D spending by 16% in Q4 and 9% for the full year to strengthen its AI capabilities.

The company highlighted the shift in the AI industry from model training to inference and system competition. In the personal AI space, Lenovo is executing an "one body, multiple terminals" strategy, with personal super agents Tianxi and Lenovo Qira set to cover more devices. The company is also exploring next-generation AI-native devices such as AI PCs, AI phones, and wearables. In enterprise AI, Lenovo is expanding its hybrid AI framework, building scalable AI solutions for vertical industries and horizontal scenarios like hybrid cloud and digital offices. It is also strengthening GPU servers, liquid cooling infrastructure, and AI services through TruScale offerings.

Lenovo Chairman and CEO Yang Yuanqing stated, "We delivered the best year in Lenovo's history with an outstanding Q4 performance. We kept our promise to bring ISG back to sustainable, profitable growth and fully captured the surging demand for AI infrastructure. With our hybrid AI strategy, we are well positioned to lead the next wave of AI inference and普及化. We are confident in reaching a $100 billion revenue scale within two years and will continue to create value for shareholders."

Key highlights from the report include:

• IDG: Q4 revenue up 24%, PC market share reached 24.4% in Q4 (a record for the quarter) and 24.2% for the full year (a record). High-end PC shipments accounted for 50% of total. Mobile business saw record Q4 smartphone shipments.
• ISG: Q4 revenue hit a record 39 billion RMB, up 37%, and returned to profitability. Full-year revenue surpassed 136 billion RMB, up 32%, with operating profit improved by 1 billion RMB. AI server revenue continued to grow, and the company built a backlog of over 140 billion RMB in orders.
• SSG: Q4 revenue reached 17.75 billion RMB, up double digits for the 20th consecutive quarter, with an operating margin of 22.4%. Managed services and project & solutions revenue accounted for a record 62% of total. AI services are entering a scale replication phase.

Lenovo's AI infrastructure business, including Neptune liquid cooling, grew strongly. The acquisition of Infinidat in April 2026 strengthened its high-end enterprise storage capabilities. The company's "as-a-service" business, TruScale, saw DaaS revenue up 26.9% and IaaS revenue up 42.5% in Q4. AI service models are becoming a key differentiator, building long-term customer relationships beyond hardware.