Apple passes Lenovo in greater China sales

Apple’s sales in greater China have for the first time overtaken those of Lenovo, the world’s third-biggest personal computer maker by shipment volume, results from the two companies confirm.

Lenovo, which was the PC industry’s fastest-growing company for the seventh consecutive quarter, said on Thursday that its China sales rose 23.4 per cent from a year ago to $2.8bn.

Strong demand for iPhones, iPads and Macintosh computers pushed Apple’s second-quarter sales in greater China, which includes Hong Kong and Taiwan, up sixfold from a year ago to $3.8bn.

Lenovo groups its Hong Kong and Taiwan sales separately from the mainland, under the ‘emerging markets’ category, which also saw strong growth over the past quarter. But for Lenovo to even match Apple’s revenue for greater China, analysts say it would have to have notched up sales in Hong Kong and Taiwan of at least $1bn.

Jenny Lai, head of Taiwan Research at HSBC, said Lenovo’s sales in those two markets “would not be enough to make up the $1bn gap.”

Nevertheless, the Chinese company remains one of the few bright spots in a global PC industry tarnished by lacklustre consumer demand in Europe and the US. Revenue in the second quarter rose 15 per cent to a record high of $5.9bn, while profits attributable to shareholders nearly doubled from a year ago to $108m.

Lenovo gained market share across all regions and last quarter overtook Acer to take the world number 3 spot.

Even in North America, Lenovo saw its shipments rise 30.8 per cent from a year ago against a 4 per cent decline in the overall market.

Lenovo declined to give any specific guidance on second-half shipments or sales, but Yuan Yuanqing, chief executive, said the company remains “optimistic” about the outlook for the rest of the year. He noted that “emerging markets, including China, continue to grow and outpace the, while in mature markets the corporate PC replacement cycle “remains strong and consistent”.

Lenovo also said it would begin to see contributions to its results in the next quarter from its acquisition of Germany’s Medion, and its joint venture in Japan with NEC.

Its optimism was in stark contrast to Dell, which earlier this week slashed its revenue forecast for the second half, citing delays in government spending and tepid consumer demand.

Investors appeared to side with Dell’s prognosis, sending Lenovo shares down 6.5 per cent in Hong Kong trading on Thursday.

Hong Kong exchange trading disrupted as hackers target website

The Hong Kong stock exchange was forced to suspend trading in stocks including HSBC Holdings after hackers broke into the exchange's website on today, preventing investors from accessing company announcements made during the midday break.

 The chief executive of Hong Kong Exchanges & Clearing Charles Li told, "Our current assessment that this is a result of a malicious attack by outside hacking."

In a statement released earlier, HKEx said it had adopted a half-day  suspension policy for issuers that announce price-sensitive information during the lunch hour.

Other systems at the exchange were not affected and trading in its securities and derivatives markets operated normally, the exchange said.

If the website remains unstable on Thursday, the exchange's bulletin board will be used for dissemination of information but the stocks will be not suspended, said Mark Dickens, head of listing at HKEx.

It discovered a five-year long campaign of cyber attacks on the networks of governments, organisations and businesses.

Other targets have been the United Nations, the Association of Southeast Asian Nations, the International Olympic Committee; and an array of companies from defense contractors to high-tech enterprises.

"It was the first time for a suspension due to such a kind of technical problem and one involving so many companies," said Alfred Chan, chief dealer at Cheer Pearl Investment in Hong Kong.

HSBC, which comprises 15 percent of Hong Kong's benchmark, confirmed during the midday break the sale of its underperforming U.S. credit card business and retail services unit to Capital One Financial.

In all, stocks contributing to about 18 percent of the Hang Seng index's weight did not trade during the afternoon session.

The move to suspend trading hit turnover on the exchange in the afternoon session since HSBC and HKEx are amongst the most liquid names traded in Hong Kong.

Shares of HSBC last traded up 3.9 percent but could have pared gains into the afternoon session considering its London-listed shares were trading up just 0.1 percent as of 1030 GMT.

HSBC rules out job cuts in India

The country's oldest foreign bank HSBC ruled out job cuts in the country as part of its global recast, saying India is a strategic market and one of the key profit centres and that it is in fact finding it difficult to offset the high attrition rates.

As part of the 30,000 job cuts announced globally yesterday.HSBC, which is the largest bank in Europe, had said it would shed 30,000 jobs as it retreats from countries where it is struggling to compete.

HSBC India Chief Executive Stuart A Davis told today,"There will be a re-allocation of resources  but it's not going to be a cut heads.We are trying to do is to eliminate bureaucracies at the back-end."

HSBC India, the fully-owned subsidiary of the largest European bank, reported a 33% rise in pre-tax profit to USD 451 million from the country, making this unit the sixth most profitable regional for the British lender.

The bank had also said it had already cut 5,000 jobs following restructuring of operations in Latin America, the US, Britain, France and the Middle East and that it would cut another 25,000 between now and 2013.HSBC had said on Sunday it would sell 195 US branches to First Niagara Financial for about USD 1 billion in cash, and close another 13 of the 470 sites it had. HSBC also intends to sell its US credit card portfolio, which has over USD 30 billion in assets to free up capital. The bank now aims to shut or sell retail operations in a further 20 countries.

"I think India already has a very high attrition rate. We are hard-pressed to even catch up on the replacements. There is a war for talent out there, but as I said, there will be reallocation of resources," Davis said.

While HSBC gives some the chop, it’s also giving jobs to others. Apart from the 15,000 people the bank wants to hire in emerging markets, hiring in Hong Kong is ongoing as well. An anonymous source told us that HSBC is on the hunt for mid to senior candidates in risk, finance, operations and prime services.