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The Battle Between Lenovo and HP: HP's Outstanding Performance May Once Again Expand Its Leading Edg

HP released its financial report for the second quarter of fiscal 2018 as of April 30, with revenue increasing by 13% to US $1403 million and net profit increasing by 89% to US $1058 million. This is the eighth consecutive quarter of growth. In particular, its huge increase in net profit shows that its operating performance continues to improve, which is obviously not good news for its main competitor Lenovo.

The battle between Lenovo and HP

Lenovo won the position of the world's largest PC in 2013 through continuous acquisitions, which can be described as boundless scenery, and this advantage continues to 2016. When Lenovo performed well, HP gradually got into trouble and fell into personnel struggle. It was depressed to replace the CEO continuously.

Under the poor operation, HP had to carry out radical reform and split the company into two in November 2015, namely HP company in charge of PC, personal computer and printer business and HP enterprise in charge of enterprise business. Then HP made changes such as layoffs. This radical change seemed to revitalize it and began to return to the growth track in the second quarter of 2016.

When HP began to gradually revive, Lenovo began to sink. Lenovo's mobile phone business first declined. It once ranked first among the former top four Chinese cool alliance. However, first, Xiaomi impacted with the Internet marketing model, then oppo and vivo rose with the advantages of advertising marketing and channels, and finally formed the four new domestic huami Ouwei. When the mobile phone business declined, its PC business also began to stagnate, Finally, in the first quarter of 2017, it lost its first position in the global PC market share and was replaced by HP.

Since the first quarter of 2017, HP's leading edge in the global PC market has shown signs of expanding. According to the data released by IDC, the market share of HP and Lenovo in the global PC market in the first quarter of last year was 21.8% and 20.4% respectively. In the first quarter of this year, the market share of HP and Lenovo was 22.6% and 20.4% respectively, and the market share gap expanded from 1.4 percentage points to 2.2 percentage points.

In the face of this unfavorable situation, Lenovo carried out reform in the middle of last year. It focused on the Chinese market to revitalize its PC business. China was reorganized into personal computer and intelligent equipment group (PCSD) and data center business group (DCG). Liu Jun, who made great contributions to Lenovo, returned to Lenovo as executive vice president of the group and President of China, Liu Jun leads China platform and PCSD business in China. When Lenovo recently released its results in the first quarter of this year (the fourth quarter of fiscal 2018), it said that it had regained its first position in the global PC market, which should refer to April to May this year.

HP's outstanding performance may once again expand its leading edge over Lenovo

Lenovo's results in the first quarter of this year (the fourth quarter of fiscal 2018) showed a significant year-on-year increase of 11%, which was further improved compared with the fourth quarter of last year. It achieved double-digit growth for the first time in nearly ten quarters and seemed to have recovered.

However, compared with the results just released by HP in the first quarter of this year, Lenovo's performance is inferior. HP's revenue growth rate is 2 percentage points higher than Lenovo's, Lenovo lost $189 million in net profit, and HP's net profit has achieved rapid growth. It can be seen that HP is much better than Lenovo in terms of revenue and net profit. From this trend, it is likely that HP will still lead HP in the PC market in the second quarter, and even its leading advantage may be further expanded, Of course, all this can only be determined after the data are disclosed by the market survey institutions after the end of the second quarter.

Of course, the financial report released by HP also had adverse news. Its total cost increased by 13% year-on-year, which was the same as the growth rate of accounts receivable. According to non GAAP, the net profit margin decreased by 0.2 percentage points, indicating that the cost increased too fast.

According to IDC's data, the global PC market has been growing for three consecutive quarters, showing that the market is stagnant. Some analysts believe that this is due to the impact of mobile phones and tablets replacing PCs. nowadays, many users around the world mainly use mobile products to obtain information, and the demand for PCs is declining; The lack of innovation in PC enterprises is also a major influencing factor, which is forcing Microsoft to intervene in the PC market. The surface launched by Microsoft has brought a new wind to the PC market. Since last year, Microsoft and Qualcomm have launched notebooks with arm architecture chips.

The stagnation of the global PC market is obviously not good news for leaders such as HP and Lenovo, but HP's performance is better among the two PC enterprises. HP's PC shipments increased by 4.3% year-on-year in the first quarter of this year, while Lenovo's growth was almost zero.

The Battle Between Lenovo and HP: HP's Outstanding Performance May Once Again Expand Its Leading Edg 1

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