Ge Long Hui·2025-08-16 19:36Core Viewpoint - The gradual weakening of tariff impacts is expected, with AI PC penetration accelerating in the second half of the year, benefiting Lenovo's three main business segments, despite uncertainties from ISG losses [1][2] Group 1: Financial Performance - For FY2026 Q1, Lenovo reported revenue of $18.83 billion, a year-on-year increase of 21.9%, and a non-GAAP net profit of $389 million, also up 21.8%, with a net profit margin of 2.1% [1] - The non-GAAP net profit forecasts for FY2026-2028 have been revised down to $1.67 billion, $1.96 billion, and $2.30 billion, respectively, reflecting a year-on-year growth of 15.9%, 17.2%, and 17.5% [1] Group 2: Business Segment Analysis - IDG segment achieved revenue of $13.46 billion, with Lenovo's PC shipment growth of 15.2% year-on-year, significantly outperforming the industry [1] - ISG segment revenue reached $4.29 billion, a 35.8% year-on-year increase, with AI server revenue more than doubling, indicating strong demand [1] - SSG segment generated $2.26 billion in revenue, up 19.8% year-on-year, with deferred revenue of $3.5 billion, enhancing business predictability [1] Group 3: Market Outlook - The acceleration of Windows 10 replacements, continued national subsidies, and reduced tariff impacts are expected to sustain PC shipment volumes and AI PC penetration [2] - With the lifting of H20 restrictions, AI server order demand is anticipated to increase, potentially leading ISG back to profitability [2] - The SSG segment, previously underappreciated, is now expected to contribute significantly to overall performance due to rising enterprise AI demand [2]