Lenovo to start layoffs after PC Biz hit

Global technology brand Lenovo has started laying off employees as its PC business suffers significantly amid the economic downturn.

According to the CRN report, Levono’s job cuts are “part of an approximately $115 million cost-cutting plan.”

In February, Lenovo CEO Yang Yuanqing announced an upcoming “workforce adjustment” as part of a broader cost-cutting drive.

The company employed approximately 75,000 employees at the end of the 2022 financial year.

“As our CEO Yuanqing Yang said in our most recent quarterly earnings announcement, we are reducing operating expenses and making workforce adjustments as needed and appropriate,” a company spokesperson said in a statement.

“We will continue to invest in areas that will accelerate growth and the overall transformation of the company,” a spokesperson told WRAL TechWire.

A “severe downturn” in the PC and smartphone markets caused the company’s revenue to drop 24 percent (year-over-year) to $15.3 billion and net income to $437 million in the quarter ended Dec. 31.

The company had hinted at job cuts in the future as part of general cost savings.

Lenovo CFO Wong Wai Ming blamed the downturn on “a combination of global economic challenges and dynamic changes in market demand.”

According to international data, in the March quarter (Q1 2023), weak demand, excess inventories, and a deteriorating macroeconomic climate led to global shipments of traditional PCs to 56.9 million units, a whopping 29 percent drop compared to the same quarter last year. Corporation (IDC).

Lenovo leads the global PC market with 22.4 percent market share, followed by HP Inc with 21.1 percent and Dell Technologies with 16.7 percent market share.

According to the report, the pause in growth and demand is also giving the supply chain room to make changes as many factories begin to explore production options outside of China.

If the recession in key markets stretches into next year, the recovery may be slow.

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