Lenovo's stock surged as much as 31% on Friday, capping a 109% gain for May-its best monthly performance since 1999. The rally made the world's largest PC maker the top performer on the Hang Seng Index this year, up 159%.
The trigger: Lenovo's Q4 earnings showed quarterly revenue of $21.6 billion, up 27% year-on-year, and the fastest growth in five years. Net profit hit $521 million, a 479% jump from $90 million a year earlier.
The engine is the Infrastructure Solutions Group, or ISG, which builds AI-optimized servers for clients like Amazon, Microsoft, and Google. ISG posted record quarterly revenue of $5.6 billion, up 37% year-on-year, and crossed $19.2 billion for the full fiscal year.
AI-related revenue grew 84% year-on-year and now accounts for 38% of total quarterly sales. More than one dollar in three that Lenovo earns today traces back to AI.
Dell Technologies also boosted sentiment, reporting Q1 FY2027 revenue of $43.84 billion, up 88% year-on-year, and raising its full-year AI server revenue guidance to $60 billion.
CEO Yuanqing Yang called FY2026 the best year in Lenovo's 40-year history and set a target of $100 billion in annual revenue within two years. Full-year revenue came in at $83.1 billion, up 20%-the first time the company has crossed $80 billion.
ISG enters FY2027 with an AI server pipeline exceeding $21 billion in committed demand, though how fast Lenovo can ship depends on securing GPU allocations from Nvidia.