China's Lenovo says global chip shortage to persist as profit jumps

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China's Lenovo Group, the world's biggest maker of personal computers, said that a global chip shortage would persist into the first half of next year as it reported a 65% rise in second-quarter profit on Thursday.

The company said it was able to outgrow the market by securing more supply of components than its peers, but acknowledged that a dearth of chips was "causing delays in order fulfilment and significant back-log orders across PCs, smartphones, and servers."

CEO and Chairman Yang Yuanqing told Reuters in an interview that his earlier prediction that the shortage will remain unresolved at least until the first half of 2022 remained unchanged. "The shortage is driven by strong demand, particularly in the IT sector and in the electrical vehicle sector," he said.

Shares in the company fell as much as 5% after its results which Guotai Junan analyst Gin Yu said reflected market concerns over how the semiconductor crunch, which has impacted goods from automobiles to home appliances, was affecting worldwide PC shipments.

Research consultancy Gartner said last month that growth in worldwide PC shipments slowed in the September quarter as easing anti-virus measures prompted consumer and educational spending to move away from PCs to other priorities and chip shortages constrained laptop shipments.

Lenovo retained the title of largest worldwide PC vendor by shipments, though its growth slowed after five consecutive quarters of double-digit growth, Gartner said. In the third quarter, Lenovo's global market share grew 1.8% to 23.7%.