Lenovo is the latest tech firm to feel the pinch, turns to cost cutting

Lenovo has said today that it will be starting to cost cut across the business, following a fall in sales for the second consecutive quarter, as well as profits falling for the first time since 2020 as a result of reduced demand for PC's.

Lenovo's Q3 financial report showed that net profit had fallen by a third down to $437 million, and revenue was down 24% year on year. The company said that

"operating performance was impacted by subdued demand in the PC sector, stemming from persistent macro headwinds including rising interest rates."

Lenovo isn't the only tech company facing struggles in the last few months, with competitors Dell and HP also announcing rounds of layoffs as a result of the downturn present in the market. Lenovo hasn't commented on whether it will be announcing layoffs within its 75,000 strong workforce at this time, but Chief Financial Officer Wong Wai Ming, said the following, not ruling it out.

"This includes overall reduction in operational spending as well as workforce adjustments where necessary and appropriate."

Forecasts from Gartner aren't looking great for the rest of 2023, with year-on-year declines across the PC, tablet and smartphone market at an estimated 4.4%, but refresh cycles after that may help it improve.

Source: The Register

Lenovo is the latest tech firm to feel the pinch, turns to cost cutting