Lenovo Group (0992.HK) stock surged 20% on May 22 following stronger-than-expected Q4 earnings and profit results. The company's fourth quarter ended March 31, 2026, delivered revenue of 149.5 billion yuan with 27.1% year-over-year growth—the highest quarterly increase in nearly 20 quarters—while adjusted net profit jumped 100.7% year-over-year. For the full fiscal year, Lenovo reported revenue of 589.9 billion yuan, up 20.3% year-over-year and marking a historical high, with adjusted net profit reaching 13 billion yuan, up 42.1% year-over-year. Lenovo's three business segments—IDG (Intelligent Devices Group), ISG (Infrastructure Solution Group), and SSG (Solution & Services Group)—all achieved double-digit revenue growth and profitability, surpassing market expectations. CEO Yang Yuanqing attributed the results to the company's hybrid AI strategy, which positioned AI as Lenovo's fastest-growing engine with full-year revenue growth of 105% year-over-year.
Q4 and Full-Year Financial Performance
Lenovo's fourth quarter delivered adjusted net profit growth of 100.7% year-over-year, with net profit under Hong Kong Financial Reporting Standards surging 479.5% year-over-year. Yang Yuanqing stated that both revenue and profit represented the strongest fourth quarter in company history.
The ISG segment achieved particular significance, recording full-year revenue of 136.24 billion yuan, up 32% year-over-year—a historical high that exceeded market consensus expectations. ISG attained full-year profitability for the first time, with operating profit and profit margin both reaching record highs. Operating profit exceeded 200 million dollars for the first time, while the segment achieved 37% high-speed growth simultaneously with substantial profitability improvement.
The IDG segment generated full-year revenue of 418.46 billion yuan, up 16.6% year-over-year, exceeding market expectations. PC business revenue increased 26% year-over-year, marking the highest growth rate in five years. Lenovo's global PC market share reached 24.2%, a historical high, with the gap to the second-place competitor expanding to 5.1 percentage points. Lenovo remained the only top-five global PC manufacturer to maintain consecutive year-over-year positive shipment growth over the past 10 quarters.
AI as Primary Growth Engine
AI revenue emerged as Lenovo's fastest-growing segment, achieving 105% year-over-year growth for the full fiscal year. This performance reflected the company's strategic focus on hybrid AI deployment across its three business divisions.
AI server revenue grew 50% year-over-year, generating an order backlog exceeding 140 billion yuan. Lenovo strengthened GPU server, liquid cooling, and enterprise-grade storage capabilities. The company completed the acquisition of Infinidat to enhance its high-end enterprise storage portfolio, thereby improving overall profitability.
In the China market, ISG business achieved approximately 20% revenue growth year-over-year and transitioned to profitability. Lenovo became a core supplier to major cloud service providers including ByteDance, Alibaba, Tencent, and Baidu. The E/SMB (Enterprise/Small and Medium Business) segment showed stronger performance, recording 44% full-year growth.
IDC data indicated that global server market revenue reached a record 444 billion dollars in 2025, up 80.4% year-over-year, reflecting the surge in global AI infrastructure demand as the industry transitioned from large language model training to inference-driven and industry application phases.
Future Growth Outlook
When asked about AI agent development's impact on Lenovo's business, Yang Yuanqing stated that AI agent development aligns with Lenovo's hybrid artificial intelligence concept, particularly in personal intelligence applications. He described Lenovo's vision of deploying a single AI agent across multiple endpoints—computers, smartphones, tablets, glasses, and home servers.
Yang Yuanqing announced that AI PCs would comprise over 50% of total Lenovo PC sales in the coming year, with AI servers serving as a strong growth driver. AI solutions and services, particularly customized on-demand offerings, are expected to grow rapidly.
"We are confident that within at most two years, we will increase the company's overall revenue scale to over 100 billion dollars while further improving profitability," Yang Yuanqing stated.
Lenovo's PC business continued to demonstrate resilience despite global market pressures from rising costs. Although global PC and smartphone markets faced cost inflation, Lenovo simultaneously improved market share and profitability. IDC data showed that global PC shipments grew 2.5% year-over-year in Q1 2026, representing a notable slowdown compared to prior periods. Within this challenging environment, Lenovo maintained its leading position through premium product positioning and AI PC deployments.
