In the era of digital economy, “cloud” and artificial intelligence have replaced search, mobile Internet and social media and become a new battlefield in the field of science and technology. The popularity of “meta universe” is bringing them to a new climax.
The business changes of technology giants have also taken place. They have invested and explored in many fields in order to seize the opportunity and maintain a place in the era of cloud computing and AI.
In 2021, technology giants began to show their transformation achievements. Lenovo Group, as one of the leaders, has achieved a good harvest in terms of performance and capital market performance.
the era of “elephant dance”
Microsoft, the overlord of the Internet era, has missed a series of innovation opportunities. But in the age of intelligence, the technology company staged an unexpected “elephant dance”. In 2020, Microsoft’s market value has reached $1.65 trillion, second only to Apple among global technology enterprises.
Now, more and more technology enterprises have become one of these “dancing elephants”.
On November 16, Cristiano anxm, the boss of Qualcomm, stressed to investors, “our company is different from the past. We no longer focus on mobile phones. There are data to prove it.” Cisco, Lenovo Group, Dell, IBM and Huihe are also showing the attitude of business transformation to the outside world.
In 2019, Lenovo group proposed the 3S strategy of intelligent transformation: smart IOT, smart infrastructure and smart vertical, enabling the intelligent transformation of the industry. Now, Lenovo Group has put forward the concept of “new it”. It is no longer information technology, but intelligent transformation – the technology, products, services and solutions required to empower all walks of life and realize intelligent transformation based on the new technology architecture in the intelligent era.
At the beginning of the epidemic, Lenovo Group donated a full set of IT equipment for two hospitals, Leishen mountain and Huoshen mountain. In the hospital scenario, from the document printer and desktop terminal used by the front-end doctors to the data center controlling the whole hospital system at the back-end, Lenovo Group provided a full set of PCs, servers and workstations for the two hospitals within 7 days. Moreover, the location of Lenovo Group’s mobile Wuhan base was the area most seriously affected by the epidemic. The construction is completed within 7 days, thanks to the toughness and agility of Lenovo Group’s supply chain, which is the advantage of solution service business.
The logic of turning to “cloud” and intelligence is also very obvious.
In the past, these technology giants mainly sold products (hardware or software). However, in recent years, the delivery mode of it has changed from providing various large components to as-a-service mode. The industry promotes the transformation to service mode, which can avoid the loss of premium ability of the company due to product homogenization. Customers in the IT industry have to pay a lot of money for new products every few years. At the same time, hardware and even some software have become low profit businesses, but subscription services can bring more predictable revenue and higher profits.
the dream of the old Legion began to bloom
Judging from the results achieved so far, this change is undoubtedly a correct choice for science and technology giants.
In 2017, Cisco promised that more than half of its revenue will come from software and subscription business within three years. Today, this commitment has been fulfilled, and software and services now generate 53% of revenue.
Huihe announced in 2019 that it would turn all products into services by 2022. At present, its service revenue has reached US $1.2 billion.
IBM’s subscription revenue has been good, mainly due to its mainframe business, but the company hopes that such revenue can grow further.
The revenue of Qualcomm’s non mobile business such as automobile and Internet of things has reached US $10 billion, accounting for about 1 / 3 of the total revenue, and the growth rate is 1.6 times faster than that of mobile business.
Lenovo Group, standing on the right track, also built greater certainty for its own business development in the vuca era in 2021 with the “sea god needle” of 3S Transformation: in the first half of fiscal year 2021, the global epidemic made a periodic comeback and the world economy was embarrassed. With effective control of the epidemic, China has successfully resisted supply chain risks, and its economic growth has returned to a medium speed level. Lenovo Group has always maintained production and supply through intelligent manufacturing and intelligent supply chain management, successfully hitchhiked economic recovery and achieved remarkable results.
In fiscal year 2021, Lenovo Group’s solution service revenue increased by 39% year-on-year to US $4.9 billion, contributing 8% to the group’s revenue, including 28% year-on-year growth in it support services, 78% year-on-year growth in intelligent operation and maintenance services, and 58% year-on-year growth in intelligent solutions.
In the first quarter of fiscal year 2022, the value of Lenovo’s as-a-service contract more than doubled; The solution revenue increased by 56% year-on-year, and the total contract value of smart city and lighthouse factory exceeded US $100 million.
Lenovo Group’s projects in smart city have been quickly implemented in many provinces and cities in China, such as Shanghai, Jiangxi, Jiangsu, Fujian, Hubei, Hainan and Hebei, involving multiple sub scenarios such as green energy, social security management, urban emergency management, smart education, smart transportation, food safety and smart government.
The impressive performance also significantly boosted the confidence of the capital market. In the second half of 2021, after two major public opinion crises of CDR withdrawal and big V disturbance, Lenovo Group’s share price only experienced short-term fluctuations, then stabilized, even broke through the RMB 9 mark for a time, and the share price returned to before the planned CDR. The company’s share price rose 28% in the whole year, second only to Shunyu optics among the constituent stocks of Hang Seng technology index.
A market person familiar with Lenovo Group’s business model said: Lenovo Group’s share price has returned to the price before the acceptance of IPO application on Kechuang board twice in a short time, indicating that the impact of market sentiment caused by the withdrawal of the application has been digested. And considering that the stock price performance of Lenovo Group was supported by the IPO expectation to a certain extent before the IPO of the science and Innovation Board was accepted, the stock price can still return to the same price after the withdrawal of the application, indicating that the market has improved its expectation for the future development of Lenovo Group in the near future.
It can be seen that the transformation of the old technology Corps has been solid and steady, and the results are becoming more and more obvious.
Some analysts believe that with strong financial strength, scientific research investment and innovation courage, these old powerful forces may complete the transformation of reshaping themselves like Microsoft. With the growth of software service revenue dominated by azure cloud business, Microsoft’s share price has risen extremely steadily from $100 in early 2019. Even in the early stage of the epidemic, it is much more stable than other stocks, and the highest has risen to nearly $350.
(South plus)
