Lenovo Group posted a 69% decline in profit as the personal computer market continues to stagnate and its smartphone business shows little sign of recovery.<\/p>\n
The world\u2019s second-largest PC vendor reported a net income of $33 million in the three months ended March.<\/p>\n
Revenue increased 11% to $10.6 billion, surpassing the $9.8 billion projected.<\/p>\n
Lenovo has become the world\u2019s worst performing technology stock as its smartphones struggle for relevance and its core PC business loses ground to rivals such as HP Inc.<\/p>\n
The company has been dropped from Hong Kong\u2019s benchmark index as Chairman Yang Yuanqing counts on a turnaround kicking in by early 2019.<\/p>\n
Lenovo continues to be weighted down by the poor performance of a subscale mobile segment despite an improved datacenter business, Johnathan Ritucci, an analyst with Bloomberg Intelligence, wrote ahead of the release.<\/p>\n
\u201cIts US PC franchise strategy also needs to be confronted quickly, as HP continues to gain segment share.\u201d<\/p>\n
Yang keeps pushing back the deadline to turn around the smartphone business, a mix of Lenovo and Motorola branded products.<\/p>\n
This month, the company merged its mobile and PC businesses under Chief Operating Officer Gianfranco Lanci, a Lenovo veteran who helped to build company\u2019s presence in Europe.<\/p>\n
Shares of Lenovo were little changed Thursday morning. The stock is set to leave the Hang Seng Index next month after plunging 56% since it was added to the gauge in 2013.<\/p>\n