Lenovo

Company information

• Date founded: 1984
• Industry: Computer hardware/electronics
• Corporate headquarters: Hong Kong
• Type: Public

Overview

Lenovo, known formally as Lenovo Group Limited, is a Hong Kong-based multinational company that specializes in computers and related technology. It was founded in the 1980s under the brand name Legend. Lenovo’s IBM ThinkPad, a laptop that has gained great popularity with business users, is one of its best-known products.

While its main headquarters are located in Hong Kong, Lenovo does business in more than 180 countries and has offices in about sixty locations around the world. These include a global headquarters in Beijing, China, as well as an operational headquarters in Morrisville, North Carolina. In addition to the ThinkPad and other laptops, Lenovo produces desktop computers, supercomputers, computer servers, computer peripherals such as printers and scanners, smartphones, televisions, and data/media storage devices. By January 2021, it had become the world’s largest seller of personal computers based on unit sales, and it retained this position through the early and mid-2020s.

History

Lenovo was founded in Beijing, China, on November 1, 1984. Led by Chinese businessman Liu Chuanzhi, the company’s founding chairman considered from a group of eleven people who started New Technology Developer, Inc. The founders were all engineers from the Institute of Computing Technology at the Chinese Academy of Sciences. Their initial meetings were held in a small guardhouse on the science academy grounds. The $25,000 used to launch the company was borrowed from the science academy.

The company was part of a larger movement among Chinese institutes at the time to create sponsored companies to offset the impact of reduced government subsidies for higher learning. The initial hope for the company was that it could generate income for the computer technology institute at the academy. The Chinese Academy of Sciences also provided small stipends to the company’s staff and allowed the institute members who worked with the company to use academy housing and healthcare services.

The fledgling company attempted several failed ventures, including selling imported televisions and digital watches, before joining the growing computer market. It had its first modest success with a Chinese language add-on card that could generate Chinese characters for any computer. The add-on card was called Lianxiang, which is the name Lenovo is known by in China.

In 1988, the company was reorganized and renamed Legend Computer Group Co. Initially, Legend focused on business computers, with limited success. The company built a factory in mainland China to build computer motherboards, the main circuit board of a computer. That same year, Legend took the unusual step of advertising for employees on the front page of a major youth publication in China. Such advertising was generally not done at the time. From that ad, the company recruited dozens of employees who continued to work on developing new products.

It was not until 1990, when the company released its first laptop computer that it began to see real financial growth. That computer was a success even though it weighed twelve pounds, about two to three times what modern laptops weigh. Several factors helped the company succeed. At the time Legend was releasing its first laptop, the Chinese government changed trade policies to favor homegrown companies instead of overseas competitors. These changes soon gave Legend an advantage, as its major Chinese competitor was accustomed to selling its products at higher prices to match the cost of imported products. Legend took a different approach. The company sold its products with a very small profit margin. The company’s leadership also chose to focus on products that would appeal to their Chinese market at a time when larger foreign competitors were selling products with broader appeal.

In 1994, the company was listed publicly on the Hong Kong Stock Exchange for the first time. Two years later, it officially became China’s leading computer company. In 1998, Legend produced its one-millionth personal computer (PC), and became the largest seller of PCs in the Chinese market. It also released the Tianxi, a computer designed for inexperienced users. The Tianxi featured a single button to connect to the internet and came bundled with a year of internet service. It soon became the best-selling computer in the Chinese market. By the following year, Legend was dominating the entire Asian-Pacific market.

In 2003, Legend announced it was changing its name to Lenovo. The name was a combination of Le, which means “legend,” and novo, which means “new.” After renaming the company, Lenovo launched on the international market that same year. In 2004, it was announced that the company—previously little-known outside of Asia—was acquiring IBM’s personal computer line. It took a year to complete the $1.25 billion sale, merging Lenovo’s product line with IBM’s highly successful ThinkPad line.

The transfer was not without challenges, but in 2006, Lenovo provided all the computer technology for the Winter Olympic Games hosted by Torino, Italy. The success of this effort, which involved more than 6,000 computers and 350 computer servers to support them, demonstrated the company’s abilities. Lenovo also expanded both in product lines and markets, producing cell phones and other mobile devices and moving into software development while also opening facilities in North Carolina and other locations around the world.

By 2013, Lenovo was recognized as the world’s top personal computer company as well as the number three smartphone producer in the world. In 2014, Lenovo further expanded its cell phone production when it acquired Motorola. The company continued to expand and diversify, purchasing companies that provided computer servers and provided cloud storage solutions. Then, in 2015, the company changed its logo and combined it with the company motto, “Innovation Never Stands Still.”

In 2019, Lenovo was ranked as the top seller of personal computers worldwide. One quarter of the computers sold in 180 markets around the world carried the Lenovo name. The computers were produced and supported by 57,000 employees in about sixty facilities, which generated more than $50 billion in revenue. In the early and mid-2020s, Lenovo remained the global market leader in PC sales, holding over 20 percent of the market. Lenovo’s annual revenue increased to $71.618 billion in 2022, and its number of employees increased to approximately 75,000, both indicators of Lenovo’s continued success. However, by 2024, the company's revenue decreased to $56.864 billion.

In 2023, the company released the Lenovo LOQ line of gaming laptops and PCs. The following year, Lenovo PCCW Solutions, a branch of Lenovo, acquired Explora and Eleven Digital to increase the company’s marketing cloud offerings and enhance data practices. Also in 2024, the company released its first artificial intelligence business and consumer laptops.

Impact

In addition to the company’s impact on computer sales and its own financial success, Lenovo announced a commitment to making an environmental and social impact. The company was selected by the Science Based Targets Initiative (SBTi) to be a test company for policies and procedures to lead to net-zero emissions in their manufacturing facilities. Using the SBTi methods, the company planned to reduce various emissions significantly by 2030. Lenovo also announced its intention to reduce renewable energy for at least 90 percent of its manufacturing needs and to remove one million tons of greenhouse gas emissions from its overall supply chain. In addition, the company planned to reduce its carbon footprint and minimize waste in its products and packaging while also increasing the energy efficiency of its consumer products. In 2022, Lenovo announced its plans for net-zero emissions by 2050.

The company also publicly committed to maintaining its staffing standards, which required ethical treatment of employees. In addition, Lenovo committed to inclusion policies that would increase the number of women and minorities in leadership while also ensuring that their products were accessible and worked well for people with disabilities. The company also made a significant commitment to philanthropic efforts to benefit established community and nonprofit entities.

In the early 2020s, Lenovo maintained its status as the world’s top seller of personal computers. It also ranked near the top of the markets for cell phones, tablets, and other electronic devices. By the beginning of that decade, Lenovo manufactured more than one quarter of the world’s five hundred most powerful supercomputers and held nearly one hundred world records for computer key workloads. The company continued to attempt innovative products, including those that use virtual reality and that improve the effectiveness of technology used in a variety of fields, such as computerized tomography (CT) scans used in medical fields, jet airplane engines, forecasting, equipment, and retail inventory control.

Ongoing endeavors for the company included expanding the use of self-monitoring analysis and reporting technology, commonly known as smart technology, that uses a combination of sensors, chips, software, and more to automate and coordinate functions in devices such as cellphones, cars, and more. Lenovo produced the Moto Z3 and Moto 5G mod, the first smartphones that utilized 5G, or the fifth generation of wireless cellular technology. The company has also developed a special virtual reality program that combines artificial intelligence and augmented reality to create products that can be used for education in a variety of fields. For example, one version, called Starlight Experience, is intended to be used by hospitalized children for educational and entertainment purposes. Similar devices have been designed to help train and identify problems in manufacturing and to allow physicians to treat patients in distant locations.

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