2017.05.2821:51:00UTC+00Lenovo Turns to Pricier Models to Stop Bleeding in its Smartphone Business

Chinese multinational technology firm Lenovo Group Ltd is currently relying on a push upmarket to stop the losses incurred in its smartphone business following its acquisition of Motorola three years ago.

The company announced that it will reorganize its China business which is aimed at sharpening the PC brand's consumer focus amid the effort to strengthen its mobile branding and also shift the focus to more expensive models under the Moto brand.

The group's smartphone concerns began after it acquired Motorola Mobility from Google for $2.9 billion back in 2014 but have since then struggled to integrate the assets. Although the company returned to profit in the year to March, the group's phone problems worsened as marketing expenses for new products and key components costs increased.

In its home base of China, Lenovo's shipments have domestically dropped 80 percent year-on-year or 55 percent quarter-on-quarter during the first three months of 2017, according to Canalys data.

However, shipments in Brazil climbed 56 percent in the first quarter of this year according to Lenovo, exceeding India as its largest market, where volumes rose 34 percent.

Chairman Yang Yuanqing said Lenovo is poised to reach its goal of turning around the mobile business by the second half of the fiscal year starting in April. He added that the company will also have three more telecom partners in the U.S. in 2017 as its performance in Western Europe continues to improve.