7 ms·

Lenovo Is Laying Off 3,200

50 points by ghosh 11y ago

pjmlp 11y ago
> Lenovo reported revenue of $10.7 billion, up three percent on the same period last year And yet they fire people. I really hate these MBAs with the politic that "Oh well we didn't achieved our continuous growth, let's sack some people". Back in the day, companies would be happy to have any profit at all. EDIT: Being downvoted by MBAs it seems.
- netrus 11y ago
  Who invested in companies that were happy to have any profit at all, back in the days? I mean, we are talking about days when inflation was >4% ...
  - pjmlp 11y ago
    For me, back in the day, means since mankind does business not when MBAs were released into the world.
    - fwn 11y ago
      Is that some kind of game? Adding the letters MBA to every comment?
    - product50 11y ago
      I hope when you grow up and become more mature, you revisit this thread and laugh at how ignorant your thoughts were at one point of time.
    - rantanplan 11y ago
      Even if MBAs were the worst thing that happened to mankind, this has nothing to do with them. It is simple arithmetic. Relax and get rid of that chip on your shoulder.
- pathy 11y ago
  Revenue and profit are two very different things. Their quarterly profit was just $105m so it isn't exactly a high margin business. That number was a 51% drop compared to the same quarter last year. [0] It is hardly surprising that they want to shed staff if the profit dropped that much. Nor was the 3% revenue increase anything spectacular. [0] http://www.bbc.com/news/business-33900230 http://www.bbc.com/news/business-33900230
  - pjmlp 11y ago
    It was still a profit, that is my point and your reply just sounds the typical MBA stuff I was mentioning. A business is sound if it can pay its employees and running expenses with a little savings on the side, not trying to achieve increase multiplication factors in profit.
    - mkohlmyr 11y ago
      That's just silly though, if you see a bad trend, make adjustments to buck it? Just because you're "still making a profit" doesn't mean you're doing well or even that you aren't on the road to disaster. And unfortunately when you are a public company, your responsibility on this front is to your shareholders, not to your employees. If it were a private company I'd agree to a certain extent, assuming that they could see an alternative way to stop this downward trend. However as a public company, constant growth is a must.
      - fsloth 11y ago
        "And unfortunately when you are a public company, your responsibility on this front is to your shareholders, not to your employees." I don't think it's as clear cut as that. Isn't blindly cutting costs just effectively destroying company infrastructure? "However as a public company, constant growth is a must." But just laying people off does not guarantee growth. That said, I have no idea how the company is structured or operates. Sometimes laying people off is kinda necessary, i.e. a company with a factory that manufactures product X, suddenly there is no market for X , and the factory cannot be reconfigured to create profit - yeah, that's clear cut. IMO, generic sweeping statements like "removing n percent of personnel is necessary to cut costs" is impossible to gauge in negative or positive light without detailed understanding of the business or it's operations.
- javert 11y ago
  If I were a Lenovo shareholder I would be glad to see that the company is trying to maximize earnings.
- dade_ 11y ago
  The IBM announcement alone will have a major impact on future sales. http://www.techradar.com/news/computing/apple/former-apple-rival-ibm-could-become-the-biggest-buyer-of-macbooks-1300861 http://www.techradar.com/news/computing/apple/former-apple-r... It doesn't take an weatherman (MBA), to know it's raining. Lenovo has a rough ride ahead.
- forgetsusername 11y ago
  >"Being downvoted by MBAs it seems." Being down-voted for being financially illiterate and detached from reality.
mike-cardwell 11y ago
"laying off 3,200 employees" "in a move that should trim its wage bill by an estimated $1.35 billion per year." $1,350,000,000 / 3,200 = $421,875 I need a payrise.
- thecopy 11y ago
  I don't know if it is different were Lenovo operates, bu there in Sweden if i get 100 in salary, the company has a cost of 200 because of social taxes, employment tax etc.. I guess also HR will have less to do, which contributes to the cost-save.
  - mike-cardwell 11y ago
    Yeah. Employee cost > employee salary. Still... $421,875... Somebody has got their math wrong.
    - zamalek 11y ago
      ~~Taking Sweden as the example the take-home salary would be $126000pa. That's not entirely unreasonable.~~ Edit: scratch that, I read it as "the company has an additional cost of 200" for some reason. Yeah, something is wrong with the math.
  - leogiertz 11y ago
    I'm not sure you can count what you get after taxes as salary, your personal taxes is normally considered part of your salary. The "arbetsgivaravgift" (i.e. taxes that your employer pays) is about 30% of your salary, so if you're going to get a salary of 100 that costs your employer about 130. The cash you get in hand varies depending on your personal tax rate, but normally you would receive between 50 and 70. Edit: This is for Sweden. YMMV. :)
    - iofj 11y ago
      Very true. There is a legal standard for "gross" pay which is not gross pay at all. In Northern countries gross pay is ~20-35% lower than the employer pays, and after that the employee also pays 40-55% on the "gross" amount after that. (Example "non-gross" income tax: patronal national insurance tax, corporation closure insurance tax, tax on vacation pay, tax for employment of permanently disabled persons, ... It totals ~18% in Germany, up to 38.5% in Belgium, depending on the sector (specific sectors have specific taxes - yes really)) These sorts of measures make sure that taxation is a lot less visible for "normal" people (ie. voters) in Europe than it is in America. Employers have to advertise "net pay", which is the amount you generally negotiate for. Also, for instance, the prices displayed in stores have to be tax-inclusive (there's a VAT of 18-25% as well), the prices displayed at the pump include all taxes (not just VAT), tobacco and alcohol have to be advertised with prices including all taxes. That means a European kid might very well not hear the word "tax" until they're 24-25 and get a real, first job, and will likely think they're only paying an income tax of 40-55%, when in fact they are paying a tax of 1/1.200.60.82 = 61% (and up to 76%) (money that they can spend divided by money that is paid for their labour, inverted). And that still doesn't include property tax, car tax, and the like.
Tharkun 11y ago
Hopefully their keyboard designers are among them.
- bitL 11y ago
  They can always hire even more incompetent batch than they had in the past 3 years. And my suspicion is that it was forced upon them from management that probably stays in place to make sure there is no improvement in the future either.
- andrzejsz 11y ago
  And drop down hinges designers :)
  - listic 11y ago
    What are drop down hinges?
    - andrzejsz 11y ago
      This something like in thinkpad x240 and x250 but up to x 230 were not drop down hinges, maybe looks modern but not thinkpadish IMHO :)
- nomailing 11y ago
  And touchpad designers too. I have a Lenovo Thinkpad Yoga and the Touchpad is unusable. It has this mechanic click where the full touchpad lowers down, and while it is doing this the mouse moves slightly. Therefore it is hard to click precisely on something if during the click the mouse is moving. They probably never tested this before deciding to put this into a thinkpad or they tested it and nobody cared to hear what the testers said...
  - sergiosgc 11y ago
    Worse. They market tested it on their best laptop (the X1 Carbon). It flunked on the market, with the 2nd gen X1 receiving appalling reviews. The 3rd generation X1 Carbon reverted to the old touchpad and its marvelous Thinkpad mouse buttons.
andrzejsz 11y ago
I only hope it doesnt push them even more to destroying thinkpad brand although there are some encouraging signs as shown in the release thinkpad p info
- mike-cardwell 11y ago
  In my eyes, they've already destroyed their brand by selling Thinkpads with BIOS's which automatically compromise clean Windows installs by overwriting files at boot time. That and the fact they sold Thinkpads containing software which compromised all HTTPS traffic (Superfish). Speaking as somebody who's current laptop is a Lenovo Thinkpad and who has had three other Thinkpads in the past: This will be my last.
  - p_l 11y ago
    Aren't both of those only on non-thinkpad branded machines?
    - joshuapants 11y ago
      I know Superfish was not included on Thinkpads. I am not sure about this latest breach. But that's not terribly important; the company showed that it can't be trusted. If they're so eager to sell out some of their customers, what's to stop them from going a step further in the future? Much as I love Thinkpads, the only reasonable stance from here on out is to presume that every Lenovo computer is compromised by default.
  - ekianjo 11y ago
    That was not on thinkpads.
    - mike-cardwell 11y ago
      I didn't realise that. Ultimately makes no difference though. They've proven they can't be trusted to produce computers which are safe to use.
  - 11y ago
dothis 11y ago
Hopefully those who injected spyware into the bios are among them: http://arstechnica.com/civis/viewtopic.php?p=29497693&sid=ddf3e32512932172454de515091db014#p29497693 http://arstechnica.com/civis/viewtopic.php?p=29497693&sid=dd...
- jakub_g 11y ago
  The forum thread made it into a full article on Ars (which is a good summary) as someone points out later in the thread http://arstechnica.com/information-technology/2015/08/lenovo-used-windows-anti-theft-feature-to-install-persistent-crapware/ http://arstechnica.com/information-technology/2015/08/lenovo...
  - javert 11y ago
    Wow. This is a big deal I hadn't heard of. Coming after Superfish, this is totally unacceptable. Leonovo is working REALLY REALLY hard to lose loyal technical customers. Imagine doing a clean install and still finding crapware installed on your laptop. Unbelievable.
    - joshuapants 11y ago
      > Leonovo is working REALLY REALLY hard to lose loyal technical customers. They already lost me after Superfish, but now with this instead of passively not buying I'm going to actively recommend that others not. It's absolutely unacceptable.
      - javert 11y ago
        Problem is, the only decent quality machines I've ever had have been ThinkPads. I'm afraid of paying big money for a high-end machine from some other brand and having it turn out to be somewhat of a lemon. Of course there is always Apple, which has consistently high quality, but I prefer to run Linux, so that's out.
- bitL 11y ago
  It's usually the opposite - the reasonable ones that were fighting this insanity are the first to go and the ones fully on board with whichever stupid idea from management will get their role strengthened...

50 points by ghosh 11y ago

pjmlp 11y ago

> Lenovo reported revenue of $10.7 billion, up three percent on the same period last year And yet they fire people. I really hate these MBAs with the politic that "Oh well we didn't achieved our continuous growth, let's sack some people". Back in the day, companies would be happy to have any profit at all. EDIT: Being downvoted by MBAs it seems.

netrus 11y ago
Who invested in companies that were happy to have any profit at all, back in the days? I mean, we are talking about days when inflation was >4% ...
- pjmlp 11y ago
  For me, back in the day, means since mankind does business not when MBAs were released into the world.
  - fwn 11y ago
    Is that some kind of game? Adding the letters MBA to every comment?
  - product50 11y ago
    I hope when you grow up and become more mature, you revisit this thread and laugh at how ignorant your thoughts were at one point of time.
  - rantanplan 11y ago
    Even if MBAs were the worst thing that happened to mankind, this has nothing to do with them. It is simple arithmetic. Relax and get rid of that chip on your shoulder.
pathy 11y ago
Revenue and profit are two very different things. Their quarterly profit was just $105m so it isn't exactly a high margin business. That number was a 51% drop compared to the same quarter last year. [0] It is hardly surprising that they want to shed staff if the profit dropped that much. Nor was the 3% revenue increase anything spectacular. [0] http://www.bbc.com/news/business-33900230 http://www.bbc.com/news/business-33900230
- pjmlp 11y ago
  It was still a profit, that is my point and your reply just sounds the typical MBA stuff I was mentioning. A business is sound if it can pay its employees and running expenses with a little savings on the side, not trying to achieve increase multiplication factors in profit.
  - mkohlmyr 11y ago
    That's just silly though, if you see a bad trend, make adjustments to buck it? Just because you're "still making a profit" doesn't mean you're doing well or even that you aren't on the road to disaster. And unfortunately when you are a public company, your responsibility on this front is to your shareholders, not to your employees. If it were a private company I'd agree to a certain extent, assuming that they could see an alternative way to stop this downward trend. However as a public company, constant growth is a must.
    - fsloth 11y ago
      "And unfortunately when you are a public company, your responsibility on this front is to your shareholders, not to your employees." I don't think it's as clear cut as that. Isn't blindly cutting costs just effectively destroying company infrastructure? "However as a public company, constant growth is a must." But just laying people off does not guarantee growth. That said, I have no idea how the company is structured or operates. Sometimes laying people off is kinda necessary, i.e. a company with a factory that manufactures product X, suddenly there is no market for X , and the factory cannot be reconfigured to create profit - yeah, that's clear cut. IMO, generic sweeping statements like "removing n percent of personnel is necessary to cut costs" is impossible to gauge in negative or positive light without detailed understanding of the business or it's operations.
javert 11y ago
If I were a Lenovo shareholder I would be glad to see that the company is trying to maximize earnings.
dade_ 11y ago
The IBM announcement alone will have a major impact on future sales. http://www.techradar.com/news/computing/apple/former-apple-rival-ibm-could-become-the-biggest-buyer-of-macbooks-1300861 http://www.techradar.com/news/computing/apple/former-apple-r... It doesn't take an weatherman (MBA), to know it's raining. Lenovo has a rough ride ahead.
forgetsusername 11y ago
>"Being downvoted by MBAs it seems." Being down-voted for being financially illiterate and detached from reality.

mike-cardwell 11y ago

"laying off 3,200 employees" "in a move that should trim its wage bill by an estimated $1.35 billion per year." $1,350,000,000 / 3,200 = $421,875 I need a payrise.

thecopy 11y ago
I don't know if it is different were Lenovo operates, bu there in Sweden if i get 100 in salary, the company has a cost of 200 because of social taxes, employment tax etc.. I guess also HR will have less to do, which contributes to the cost-save.
- mike-cardwell 11y ago
  Yeah. Employee cost > employee salary. Still... $421,875... Somebody has got their math wrong.
  - zamalek 11y ago
    ~~Taking Sweden as the example the take-home salary would be $126000pa. That's not entirely unreasonable.~~ Edit: scratch that, I read it as "the company has an additional cost of 200" for some reason. Yeah, something is wrong with the math.
- leogiertz 11y ago
  I'm not sure you can count what you get after taxes as salary, your personal taxes is normally considered part of your salary. The "arbetsgivaravgift" (i.e. taxes that your employer pays) is about 30% of your salary, so if you're going to get a salary of 100 that costs your employer about 130. The cash you get in hand varies depending on your personal tax rate, but normally you would receive between 50 and 70. Edit: This is for Sweden. YMMV. :)
  - iofj 11y ago
    Very true. There is a legal standard for "gross" pay which is not gross pay at all. In Northern countries gross pay is ~20-35% lower than the employer pays, and after that the employee also pays 40-55% on the "gross" amount after that. (Example "non-gross" income tax: patronal national insurance tax, corporation closure insurance tax, tax on vacation pay, tax for employment of permanently disabled persons, ... It totals ~18% in Germany, up to 38.5% in Belgium, depending on the sector (specific sectors have specific taxes - yes really)) These sorts of measures make sure that taxation is a lot less visible for "normal" people (ie. voters) in Europe than it is in America. Employers have to advertise "net pay", which is the amount you generally negotiate for. Also, for instance, the prices displayed in stores have to be tax-inclusive (there's a VAT of 18-25% as well), the prices displayed at the pump include all taxes (not just VAT), tobacco and alcohol have to be advertised with prices including all taxes. That means a European kid might very well not hear the word "tax" until they're 24-25 and get a real, first job, and will likely think they're only paying an income tax of 40-55%, when in fact they are paying a tax of 1/1.200.60.82 = 61% (and up to 76%) (money that they can spend divided by money that is paid for their labour, inverted). And that still doesn't include property tax, car tax, and the like.

Tharkun 11y ago

Hopefully their keyboard designers are among them.

bitL 11y ago
They can always hire even more incompetent batch than they had in the past 3 years. And my suspicion is that it was forced upon them from management that probably stays in place to make sure there is no improvement in the future either.
andrzejsz 11y ago
And drop down hinges designers :)
- listic 11y ago
  What are drop down hinges?
  - andrzejsz 11y ago
    This something like in thinkpad x240 and x250 but up to x 230 were not drop down hinges, maybe looks modern but not thinkpadish IMHO :)
nomailing 11y ago
And touchpad designers too. I have a Lenovo Thinkpad Yoga and the Touchpad is unusable. It has this mechanic click where the full touchpad lowers down, and while it is doing this the mouse moves slightly. Therefore it is hard to click precisely on something if during the click the mouse is moving. They probably never tested this before deciding to put this into a thinkpad or they tested it and nobody cared to hear what the testers said...
- sergiosgc 11y ago
  Worse. They market tested it on their best laptop (the X1 Carbon). It flunked on the market, with the 2nd gen X1 receiving appalling reviews. The 3rd generation X1 Carbon reverted to the old touchpad and its marvelous Thinkpad mouse buttons.

andrzejsz 11y ago

I only hope it doesnt push them even more to destroying thinkpad brand although there are some encouraging signs as shown in the release thinkpad p info

mike-cardwell 11y ago
In my eyes, they've already destroyed their brand by selling Thinkpads with BIOS's which automatically compromise clean Windows installs by overwriting files at boot time. That and the fact they sold Thinkpads containing software which compromised all HTTPS traffic (Superfish). Speaking as somebody who's current laptop is a Lenovo Thinkpad and who has had three other Thinkpads in the past: This will be my last.
- p_l 11y ago
  Aren't both of those only on non-thinkpad branded machines?
  - joshuapants 11y ago
    I know Superfish was not included on Thinkpads. I am not sure about this latest breach. But that's not terribly important; the company showed that it can't be trusted. If they're so eager to sell out some of their customers, what's to stop them from going a step further in the future? Much as I love Thinkpads, the only reasonable stance from here on out is to presume that every Lenovo computer is compromised by default.
- ekianjo 11y ago
  That was not on thinkpads.
  - mike-cardwell 11y ago
    I didn't realise that. Ultimately makes no difference though. They've proven they can't be trusted to produce computers which are safe to use.
- 11y ago

dothis 11y ago

Hopefully those who injected spyware into the bios are among them: http://arstechnica.com/civis/viewtopic.php?p=29497693&sid=ddf3e32512932172454de515091db014#p29497693 http://arstechnica.com/civis/viewtopic.php?p=29497693&sid=dd...

jakub_g 11y ago
The forum thread made it into a full article on Ars (which is a good summary) as someone points out later in the thread http://arstechnica.com/information-technology/2015/08/lenovo-used-windows-anti-theft-feature-to-install-persistent-crapware/ http://arstechnica.com/information-technology/2015/08/lenovo...
- javert 11y ago
  Wow. This is a big deal I hadn't heard of. Coming after Superfish, this is totally unacceptable. Leonovo is working REALLY REALLY hard to lose loyal technical customers. Imagine doing a clean install and still finding crapware installed on your laptop. Unbelievable.
  - joshuapants 11y ago
    > Leonovo is working REALLY REALLY hard to lose loyal technical customers. They already lost me after Superfish, but now with this instead of passively not buying I'm going to actively recommend that others not. It's absolutely unacceptable.
    - javert 11y ago
      Problem is, the only decent quality machines I've ever had have been ThinkPads. I'm afraid of paying big money for a high-end machine from some other brand and having it turn out to be somewhat of a lemon. Of course there is always Apple, which has consistently high quality, but I prefer to run Linux, so that's out.
bitL 11y ago
It's usually the opposite - the reasonable ones that were fighting this insanity are the first to go and the ones fully on board with whichever stupid idea from management will get their role strengthened...