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Lenovo sacrificing income for marketshare

Posted on Saturday, August 21 2010 @ 10:35:06 CEST by

Bright Side of News reports Lenovo seems to be trading income for higher marketshare:
Lenovo Group increased marketing dollars and offered cheaper product during their first quarter. The result: China’s largest personal computer manufacturer’s net income April - June was only $54.9 million, disappointing analysts, who’d expected $4.9 million more. Truth to be told, during the same period last year, Lenovo was $16 million in red.

The company did not release overall revenue figures, though.

Trying to gain customers in emerging markets, Lenovo is producing low-priced products. Trying to increase mobile phone sales, they are spending more on marketing efforts. The company is sacrificing a bird in the hand for two in the bush – trading current profits to acquire future market share. Their stock , like their revenue, has gone down this year as they bet on future profitability.



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