Lenovo's global business should stay weak for the foreseeable future as the company has difficulties gaining brand recognition among consumers outside of Asia, analysts say. It has been grappling with expenses arising from its $1.25 billion purchase of IBM's PC arm, amid competition from bigger rivals Dell and Hewlett-Packard.
Despite strength on its home turf--Lenovo commands a third of the Chinese PC market, the world's largest after the United States--the firm is struggling to expand beyond Asia.
It continues to relinquish market share in major international markets--due to a lack of brand recognition and consumer exposure, experts say. Lenovo ranks a distant third to Dell and HP with a near 8 percent global market share.
Compounding its problems is an expected deceleration of growth worldwide amid swelling inventory and as the delayed release of Windows Vista spurs consumers to put off purchases. IDC expects 10.5 percent growth in PC shipments this year, versus 2005's 16 percent.
And Chairman Yang Yuanqing told Reuters in September it would take at least three years to return to strong profitability.
The firm's dominant share in Asia excluding Japan grew to 21 percent in the calendar third quarter from 19.9 percent in the previous quarter, according to IDC. HP ranked second with 12.9 percent, and Dell stood at No. 3 with 9 percent.
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