Lenovo Shares Plunge 5% as Sales Growth Disappoint Investors

China-based PC maker Lenovo's shares tumbled despite its strong profit growth for the second quarter, as the company's sales result disappointed investors.

The company earlier reported a 19% rise in profits to $262m (£163.8m, €209m) for the three months ended in September.

Quarterly revenues rose 7% to $10.5bn, but they fell short of analysts' expectations. Sales from the company's mobile device division declined 6% to $1.4bn.

Lenovo shares declined more than 5% in Hong Kong as at 8:00 am GMT.

However, the company's PC division showed impressive results for the quarter, as the broader market suffered from the advent of smartphones and tablets. Sales of laptops increased by 0.9% during the quarter, while sales of desktops increased 6.4%.

In addition, the company's smartphone shipments rose 38%.

In October, the company completed the acquisition of Motorola Mobility for $2.9bn to become the third-largest smartphone manufacturer in the world.

Lenovo currently owns Motorola's top-selling handsets under Moto and Droid brands.

"The acquisition of the Motorola brand and Motorola's portfolio of innovative smartphones like Moto X, Moto G, Moto E and the DROIDTM series... positions Lenovo as the world's third largest maker of smartphones," the company said in a statement earlier.

Lenovo also purchased IBM's low-end server business earlier this year.

"Lenovo had another strong quarter that saw excellent market share gains and profit expansion," Yuanqing Yang, chairman and CEO of Lenovo, said in a statement.

"Mobile and Enterprise are now our new growth engines, and over time, like PCs, they will become our profit pool as well," he added.