Chinese computer manufacturer Lenovo recorded a fourth-quarter net loss of $289 million, the Financial Times reports, following a one-off charge of $400 million due to US tax reform in 2017.
The loss came as a surprise to analysts, who had forecast net profits for the quarter in the region of $125 million. In the same quarter of 2016 Lenovo recorded a net profit of $98 million.
The company performed well in other metrics, however. Pre-tax profit stood at $150 million, a 48% jump from the previous year. Revenue growth, too, was up 6% year on year to $12.9 billion in the third quarter, despite Lenovo’s core business, its PC and smart device unit, seeing a marginal loss in market share.
The tax reforms introduced by the Trump administration imposed a penalty of $400 million on Lenovo’s deferred income tax assets. The company has been positive towards the event, however, saying that the lower US corporate tax rate “will benefit its operations there over time”.