World’s top PC maker sounds alarm over memory chip shortage

Lenovo Group has warned that PC shipments face mounting pressure as a worsening memory chip shortage grips the industry. The world's largest PC manufacturer announced its third-quarter results on Thursday, showing an 18% revenue increase which reached 22.2 billion dollars and exceeded the 20.6 billion dollar prediction.

The company reported a 21% decrease in net profit, which dropped to 546 million dollars because of a 285 million dollar restructuring expense. 

CEO Yang Yuanqing announced that Lenovo has increased its PC prices to compensate for rising memory expenses while the company expands into the rapidly growing AI inference market.

Yang told Reuters that AI-driven demand for memory chips is squeezing margins and threatening production targets across the PC sector. “We expect PC unit sales to face pressure, but believe we can still grow revenue and maintain profitability,” he said.

Lenovo’s PC, tablet and smartphone division, which generates about 70% of total revenue, posted a 14.3% rise in sales. 

Meanwhile, its digital infrastructure group, including its AI server business, grew 31% but recorded an operating loss of 11 million dollars as it invests heavily to expand AI capacity.

The restructuring programme aims to sharpen Lenovo’s focus on AI inference and cut costs by up to 200 million dollars over three years. Adjusted net profit, excluding one-off and non-cash items, rose 36% to 589 million dollars.

Lenovo’s AI server business delivered high double, digit revenue growth, supported by strong demand and rack, scale solutions based on Nvidia’s GB200 NVL72 design. 

Yang said AI demand is shifting from training to inference, and Lenovo expects the AI infrastructure market to triple by 2028. The company recently unveiled new enterprise servers for AI inference workloads in partnership with AMD.