Analyst Commentary

Although still in decline, Lenovo’s DCG continues to show signs of progress

Lenovo’s Data Center Group (DCG) has been in a state of transformation since early 2017, as the vendor works to correct some initial missteps with its acquisition of IBM’s x86 business back in October 2014. 3Q17 was the third consecutive quarter in which DCG reduced revenue declines sequentially. The unit achieved $976 million in revenue, and declined 9.8% year-to-year in 3Q17. Although DCG continues to operate at a loss, reported pre-tax income improved from -$140 million in 3Q16 to -$100 million in 3Q17. This demonstrates that although perfor...

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