_2.svg){kind=link}
.jpg){kind=link}
The story
Founded by Liu Chuanzhi in 1984, in Beijing.1
1984–1993: Founding and early history
Lenovo was founded in Beijing on 1 November 1984 as Legend by a team of engineers led by Liu Chuanzhi and Danny Lui. Initially specializing in televisions, the company migrated towards manufacturing and marketing computers.
Liu Chuanzhi and his group of ten experienced engineers, teaming up with Danny Lui, officially founded Lenovo in Beijing on 1 November 1984, with 200,000 yuan. The Chinese government approved Lenovo's incorporation on the same day. Jia Xufu (贾续福), one of the founders of Lenovo, indicated that the first meeting in preparation for starting the company was held on 17 October the same year. Eleven people, the entirety of the initial staff, attended. Each of the founders was a member of the Institute of Computing Technology of the Chinese Academy of Sciences (CAS). The 200,000 yuan used as start-up capital was approved by Zeng Maochao (曾茂朝). The name for the company agreed upon at this meeting was the Chinese Academy of Sciences Computer Technology Research Institute New Technology Development Company.
The organizational structure of the company was established in 1985 after the Chinese New Year. It included technology, engineering, administrative, and office departments. The group first attempted to import televisions but failed. It rebuilt itself as a company doing quality checks on computers. It also tried and failed to market a digital watch.
In May 1988, Lenovo placed its first recruitment advertisement on the front page of the China Youth News. Such ads were quite rare in China at the time. Out of the 500 respondents, 280 were selected to take a written employment exam. 120 of these candidates were interviewed in person. Although interviewers initially only had the authority to hire 16 people, 58 were given offers. The new staff included 18 people with graduate degrees, 37 with undergraduate degrees, and three students with no university-level education. Yang Yuanqing, the current chairman and CEO of Lenovo, was among that group.
Liu Chuanzhi received government permission to form a subsidiary in Hong Kong and to move there along with five other employees. Liu's father, already in Hong Kong along with Lui, furthered his son's ambitions through mentoring and facilitating loans. Liu moved to Hong Kong in 1987. To save money during this period, Liu and his co-workers walked instead of taking public transportation. To keep up appearances, they rented hotel rooms for meetings.
In 1990, Lenovo started to manufacture and market computers using its own brand name. Some of the company's early successes included the KT8920 mainframe computer. It also developed a circuit board that allowed IBM-compatible personal computers to process Chinese characters.
1994–1998: IPO, second offerings and bond sales
Lenovo (known at the time as Legend) became publicly traded after a 1994 Hong Kong IPO that raised nearly US$30 million at HK$1.33 per share. Prior to the IPO, many analysts were optimistic about Lenovo. On its first day of trading, the company's stock price hit a high of HK$2.07 and closed at HK$2.00 suggesting an initial under-valuing of the company. Proceeds from the offering were used to finance sales offices in Europe, North America and Australia, to expand and improve production and research and development, and to increase working capital.
By 1996, Lenovo was the market leader in China and began selling its own laptop. By 1998 it held 43 per cent of the domestic computer market share in China, selling approximately one million computers.
Read the full text
Lenovo released its Tianxi (天禧) computer in 1998. Designed to make it easy for inexperienced Chinese consumers to use computers and access the internet, one of its most important features was a button that instantly connected users to the internet and opened the Web browser. It was co-branded with China Telecom and it was bundled with one year of Internet service. The Tianxi was released in 1998. It was the result of two years of research and development. It had a pastel-colored, shell-shaped case and a seven-port USB hub under its screen. As of 2000, the Tianxi was the best-selling computer in Chinese history. It sold more than 1,000,000 units in 2000 alone.
1999–2010: Merger with the IBM Personal Systems Group and sale of smartphone division
To fund its continued growth, Lenovo issued a secondary offering of 50 million shares on the Hong Kong market in March 2000 and raised about US$212 million. It rebranded to the name Lenovo in 2003 and began making acquisitions to expand the company.
Lenovo established a new holding company in 2005 through a two-way merger between it and IBM's personal computer business, the latter that had originally manufactured the ThinkPad laptop and ThinkCentre desktop lines. Lenovo's acquisition of IBM's personal computer division accelerated access to foreign markets while improving Lenovo's branding and technology. Lenovo paid US$1.25 billion for IBM's computer business and assumed an additional US$500 million of IBM's debt. This acquisition made Lenovo the third-largest computer maker worldwide by volume. Lenovo's purchase of the Think line from IBM also led to the creation of the IBM/Lenovo partnership, which works together in the creation of Think-line of products sold by Lenovo.
On the purchase of IBM's personal computer division, Chuanzhi said in 2012: "We benefited in three ways from the IBM acquisition. We got the ThinkPad brand, IBM's more advanced PC manufacturing technology and the company's international resources, such as its global sales channels and operation teams. These three elements have shored up our sales revenue in the past several years." The employees of the division, including those who developed ThinkPad laptops and ThinkCentre desktops, became employees of Lenovo.
Despite Lenovo acquiring the "Think" brand from IBM, IBM still plays a key indirect, background role in the design and production of the Think line of products. Today, IBM is responsible for overseeing servicing and repair centers, and is considered an authorized distributor and refurbisher of the Think line of products produced by Lenovo.
IBM also acquired an 18.9% share of Lenovo in 2005 as part of Lenovo's purchase of IBM's personal computing division. In the years following the deal, IBM sold its stake in Lenovo, with a final sale in 2011 completing its divestment.
Mary Ma, Lenovo's chief financial officer from 1990 to 2007, was in charge of investor relations. Under her leadership, Lenovo successfully integrated Western-style accountability into its corporate culture. Lenovo's emphasis on transparency earned it a reputation for the best corporate governance among mainland Chinese firms. While Hong Kong-listed firms were only required to issue financial reports twice per year, Lenovo followed the international norm of issuing quarterly reports. Lenovo created an audit committee and a compensation committee with non-management directors. The company started roadshows twice per year to meet institutional investors. Ma organized the first-ever investor relations conference held in mainland China. The conference was held in Beijing in 2002 and televised on China Central Television (CCTV). Liu and Ma co-hosted the conference and both gave speeches on corporate governance.
Lenovo sold its smartphone and tablet division in 2008 for US$100 million in order to focus on personal computers and then paid US$200 million to buy it back in November 2009. As of 2009, the mobile division ranked third in terms of unit share in China's mobile handset market. Lenovo invested CN¥100 million in a fund dedicated to providing seed funding for mobile application development for its LeGarden online app store. As of 2010, LeGarden had more than 1,000 programs available for the LePhone. At the same time, LeGarden counted 2,774 individual developers and 542 developer companies as members.
2011–2013: Re-entering smartphone market and other ventures
On 27 January 2011, Lenovo formed a joint venture to produce personal computers with Japanese electronics firm NEC. The companies said in a statement that they would establish a new company called Lenovo NEC Holdings, to be registered in the Netherlands. NEC received US$175 million in Lenovo stock. Lenovo was to own a 51% stake in the joint venture, while NEC would have 49%. Lenovo has a five-year option to expand its stake in the joint venture.
This joint venture was intended to boost Lenovo's worldwide sales by expanding its presence in Japan, a key market for personal computers. NEC spun off its personal computer business into the joint venture. As of 2010, NEC controlled about 20% of Japan's market for personal computers while Lenovo had a 5% share. Lenovo and NEC also agreed to explore cooperating in other areas such as servers and tablet computers.
Roderick Lappin, chairman of the Lenovo–NEC joint venture, told the press that the two companies will expand their co-operation to include the development of tablet computers.
In June 2011, Lenovo announced that it planned to acquire control of Medion, a German electronics manufacturing company. Lenovo said the acquisition would double its share of the German computer market, making it the third-largest vendor by sales (after Acer and Hewlett-Packard). The deal, which closed in the third quarter of the same year, was claimed by The New York Times as "the first in which a Chinese company acquired a well-known German company."
This acquisition gave Lenovo 14% of the German computer market. Gerd Brachmann, chairman of Medion, agreed to sell two-thirds of his 60 per cent stake in the company. He was paid in cash for 80 per cent of the shares and received 20 per cent in Lenovo stock. That gave him about one percent of Lenovo. In 2025, Lenovo completed its acquisition of all remaining shares in Medion.
In September 2012, Lenovo agreed to acquire the Brazil-based electronics company Digibras, which sells products under the brand-name CCE, for a base price of R$300 million (US$148 million) in a combination of stock and cash. An additional payment of R$400 million was made dependent upon performance benchmarks. Prior to its acquisition of CCE, Lenovo already established a $30 million factory in Brazil, but Lenovo's management had felt that it needed a local partner to maximize regional growth. Lenovo cited its desire to take advantage of increased sales due to the 2014 World Cup that would be hosted by Brazil and the 2016 Summer Olympics and CCE's reputation for quality. Following the acquisition, Lenovo announced that its subsequent acquisitions would be concentrated in software and services.
In September 2012, Lenovo agreed to acquire the United States–based software company Stoneware, in its first software acquisition. The transaction was expected to close by the end of 2012; no financial details have been disclosed. Lenovo said that the company was acquired in order to gain access to new technology and that Stoneware is not expected to significantly affect earnings. More specifically, Stoneware was acquired to further Lenovo's efforts to improve and expand its cloud-computing services. For the two years prior to its acquisition, Stoneware partnered with Lenovo to sell its software. During this period Stoneware's sales doubled. Stoneware was founded in 2000. As of September 2012, Stoneware is based in Carmel, Indiana, and has 67 employees.
Lenovo re-entered the smartphone market in 2012 and quickly became the largest vendor of smartphones in mainland China. Entry into the smartphone market was paired with a change of strategy from "the one-size-fits-all" to a diverse portfolio of devices. These changes were driven by the popularity of Apple's iPhone and Lenovo's desire to increase its market share in mainland China. Lenovo surpassed Apple Inc. to become the No. 2 provider of smartphones in the domestic Chinese market in 2012. However, with approximately 100 smartphone brands sold in China, this only equated to a 10.4% market share.
In May 2012, Lenovo announced an investment of US$793 million in the construction of a mobile phone manufacturing and R&D facility in Wuhan, Hubei.
In 2013, Lenovo created a joint venture with EMC named Iomega. The venture took over Iomega's business and rebranded all of Iomega's products under the LenovoEMC brand, and designed products for small and medium-sized businesses that could not afford enterprise-class data storage. Lenovo has since retired all of the LenovoEMC products on its product page advising that the products are no longer available for purchase on lenovo.com.
Since 2014: Purchase of IBM server lines and other acquisitions
IBM sold its x86-based server lines, including System x and Blade Center, to Lenovo in 2014. Lenovo says it would gain access to more enterprise customers, improve its profit margins, and develop a closer relationship with Intel, the maker of most server processors, through its acquisition of IBM's x86-based server business. On 1 October 2014, Lenovo closed its acquisition of IBM's server division, with the final price put at $2.1 billion. Lenovo said this acquisition came in at a price lower than the previously announced $2.3 billion partially because of a change in the value of IBM inventories. The deal was already approved by Europe and China. Per Forbes, the United States Department of Treasury Committee on Foreign Investment in the United States (CFIUS) was reportedly the last major hurdle for Lenovo, since the United States had the strictest policies.
After closing, Lenovo said that its goal was to become the world's largest maker of servers. Lenovo also announced plans to start integrating IBM's workforce. The acquisition added about 6,500 new employees to Lenovo. Lenovo said that it has no immediate intent to cut jobs. Lenovo said that positions in research and development and customer-facing roles such as marketing would be "100% protected", but expected "rationalization" of its supply chain and procurement.
On 29 January 2014, Google announced it would sell Motorola Mobility to Lenovo for US$2.91 billion. As of February 2014, Google owned about 5.94% of Lenovo's stock. The deal included smartphone lines like the Moto X, Moto G, Droid Turbo, and the future Motorola Mobility product roadmap, while Google retained the Advanced Technologies & Projects unit and all but 2,000 of the company's patents. Lenovo received royalty free licenses to all the patents retained by Google. Lenovo received approval from the European Union for its acquisition of Motorola in June 2014. The acquisition was completed on 30 October 2014. Motorola Mobility remained headquartered in Chicago, and continued to use the Motorola brand, but Liu Jun, president of Lenovo's mobile device business, became the head of the company.
In April 2014, Lenovo purchased a portfolio of patents from NEC related to mobile technology. These included over 3,800 patent families in countries around the world. The purchase included standards-essential patents for 3G and LTE cellular technologies and other patents related to smartphones and tablets.
In May 2015, Lenovo revealed a new logo at Lenovo Tech World in Beijing, with the slogan "Innovation Never Stands Still" (Chinese: 创新无止境). Lenovo's new logo, created by Saatchi, can be changed by its advertising agencies and sales partners, within restrictions, to fit the context. It has a lounging "e" (similar to the Google logo) and is surrounded by a box that can be changed to use a relevant scene, solid color, or photograph. Lenovo's Chief Marketing Officer David Roman said, "When we first started looking at it, it wasn't about just a change in typography or the look of the logo. We asked 'If we really are a net-driven, customer-centric company, what should the logo look like?' We came up with the idea of a digital logo first [...] designed to be used on the internet and adaptable to context."
In early June 2015, Lenovo announced plans to sell up to US$650 million in five-year bonds denominated in Chinese yuan. The bonds were sold in Hong Kong with coupon ranging from 4.95% to 5.05%. This is only the second sale of bonds in Lenovo's history. Financial commentators noted that Lenovo was paying a premium to list the bonds in yuan given relatively low costs for borrowing in US dollars.
Lenovo said that its x86 servers would be available to all its channel partners. Lenovo planned to cut prices on x86 products in order to gain market share. This goes in alliance with IBM's vision of the future around cloud technologies and its own POWER processor architecture.
In March 2017, Lenovo announced it was partnering with Fort Lauderdale, Florida–based software storage virtualization company DataCore to add DataCore's parallel I/O-processing software to Lenovo's storage devices. The servers were reportedly designed to outperform Storage Area Network (SAN) SAN arrays.
In 2017, Lenovo formed a joint venture with Fujitsu and the Development Bank of Japan (DBJ). In the joint venture, Fujitsu would sell Lenovo a 51% stake in Fujitsu Client Computing Limited. DBJ would acquire a 5% stake.
In September 2018, Lenovo and NetApp announced about strategic partnership and joint venture in China. As part of strategic partnership Lenovo started two new lines of storage systems: DM-Series and DE-Series. Both storage systems using Lenovo hardware and NetApp software: DM-Series using ONTAP OS and DE-Series SANtricity OS.
In 2018, Lenovo became the world's largest provider for the TOP500 supercomputers.
In 2020, Lenovo became a preferred data center innovation provider for DreamWorks Animation starting with Trolls World Tour. It would later go on to be the studio's preferred workstation partner in 2021, starting with The Bad Guys.
On 12 January 2021, Lenovo filed an application to issue Chinese depositary receipts, representing newly issued ordinary shares, and to list them on the Science and Technology Innovation Board of the Shanghai Stock Exchange.
In April 2021, Lenovo was reorganized into three divisions: The Intelligent Devices Group for PCs, Smartphones, Smart Collaboration products, Augmented and Virtual Reality solutions and Internet of Things devices, the Infrastructure Solutions Group (formally known as Data Center Group) for smart infrastructure solutions, and the Solutions and Services Group focused on services and industry-specific products. Lenovo has partnered with Absolute Security since 2015 and in 2021, Lenovo Device Intelligence became supported through Absolute's persistence technology. That year, the company hit $60 billion in annual revenues.
On 8 October 2021, Lenovo withdrew its application to list on the Shanghai Stock Exchange just days after it had been accepted by the exchange, citing the possibility of the validity of financial information in its prospectus lapsing as the reason. The price of the company's shares on the Hong Kong Stock Exchange dropped by over 17% following the news, which was its biggest intraday decline in over a decade.
From Wikipedia’s article on Lenovo, shared under CC BY-SA 4.0.4