A Chinese report in November 2016 had claimed that Lenovo will only be selling Motorola phones. That is, it will phase out the Lenovo brand. This news surfaced when the company released not so great financial results. Yang Yuanqing, the Lenovo Group chairman and chief executive, told Reuters that the Lenovo brand for smartphones will never be phased out.
Yang also said that even though the company is restructuring its business in China, it’s smartphone business will not be affected in the country. The company has faced a widening loss after the release of smartphones with Lenovo and Moto branding. Regardless, the company still wants to maintain a dual-brand strategy. In some markets, Lenovo is selling both its own brand and Moto’s. However, in other markets, it only sells either Lenovo or Moto smartphones.
Lenovo’s mobile business generates around 18 percent of its revenue as the PC business makes more revenue. The mobile business has been faced with a huge loss of $566 million. The previous year’s loss was $469 million. Its data center division has also faced a loss of $343 million. Wong Wai Ming, the Lenovo CFO said that the smartphone and data center businesses were different from its PC business. Hence, the company will need more time to understand them. He added that its smartphone and server business will improve in the near future.
Yang, in the previous week, had posted on Weibo that Chinese consumers were more interested in smart devices, hence the company will be soon restructuring its Chinese business. The mobile division was previously headed by Liu Jun, who will be joining as the president of Lenovo China. He will also be leading the consumer division for the company. He has also claimed that Lenovo will be releasing more products that will cater to the consumers in China.