Goldman Sachs: LENOVO GROUP (00992) quarterly results far exceed expectations, rating "Buy"

Goldman Sachs released a research report stating that LENOVO GROUP (00992) has significantly exceeded expectations for the first quarter of the 2027 fiscal year, ending in June of this year. Revenue increased by 43% year-on-year to $27 billion, surpassing both the bank's and market's expectations by 22% and 20%, respectively. Adjusted net profit soared by 176% year-on-year to $1.1 billion, exceeding the bank's and market forecasts by 48% and 68%, respectively. The gross margin further expanded to 16.5%, also higher than the bank's and market expectations. Goldman Sachs maintains a Buy rating on Lenovo, with a target price of HK$31, corresponding to a forward P/E ratio of approximately 17.3 times for 2027. During this period, the Intelligent Devices Group (IDG) revenue grew by 27% year-on-year to $17 billion, accounting for 63% of total revenue. Personal computer shipments declined by 2% year-on-year, better than the global market decline of 4%, while the global market share of AI PCs rose to 25%, with smartphone revenue recording double-digit growth. The Infrastructure Solutions Group (ISG) revenue increased by 98% year-on-year to $8.5 billion, comprising 32% of total revenue, with AI server orders rising to $54 billion.