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Why IBM sold its PC business to Lenovo

Why IBM sold its PC business to Lenovo image
Why IBM sold its PC business to Lenovo image
Peter Rojas
Peter Rojas|January 1, 2005 4:19 PM
IBM ThinkPad X40

Obviously Lenovo must have known what they were getting into when they bought IBM's PC business last month, but it's a little more clear now why IBM was so eager to sell in the first place: they were losing money like crazy. According to a recent quarterly filing with the Securities and Exchange Commission, IBM managed to lose nearly a billion dollars selling personal computers over the last 3 1/2 years. Not that we didn't think it'd been a rough past few years or anything, and at the end of the day IBM simply wasn't willing (or able, but probably just not willing) to take the steps needed to turn things around.

The interesting part about Lenovo buying IBM's PC business that hasn't gotten much attention is that Lenovo, which is based in China, is turning over much of the management of the company to a group of senior IBM execs. Amazingly, the people who run Lenovo had the humility to recognize that they simply did not have the experience to operate on a global level and decided to outsource, as the NY Times puts it, the management of the company to people who do.

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