China's largest maker of personal computers said the next several quarters would remain very challenging for it and the sector as demand falters in an economic downturn.

Lenovo expects to save $300 million in the year to March 2010 from a restructuring involving axing 2,500 jobs worldwide, cutting executive pay and consolidating its China and Asia-Pacific operations into a single division.

The company reported an October-December loss of $96.7 million, worse than a wide range of analyst forecasts ranging from a $8 million loss to a $96 million loss.

Sales fell by a fifth and Lenovo's gross profit margin was squeezed by a continued market shift to entry level PCs, aggressive pricing and currency fluctuations, the company said.

By: DocMemory
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