Lenovo Bets on AI as South Korea Grants Banks Access to Cloud Computing

Artificial intelligence (AI) is driving seismic shifts across the tech and financial landscapes, with Lenovo reporting strong quarterly results due to its AI focus and South Korea set to allow financial firms to leverage AI and cloud technologies.

Meanwhile, a new study reveals a stark contrast between financial institutions’ enthusiasm for AI adoption and consumers’ more cautious stance, highlighting the need for education and strategic implementation in the banking sectors.

Lenovo Posts Strong Q1 Results, Bets Big on AI

Lenovo Group Ltd. reported robust first-quarter results for fiscal year 2024/25, with revenue climbing 20% year-over-year to $15.4 billion and net income surging 65% to $315 million. The Chinese tech giant’s performance, announced Aug. 15, reflects its strategic pivot toward AI and diversification beyond its core PC business.

The company’s Infrastructure Solutions Group (ISG) emerged as a key growth driver, with revenue soaring 65% to a record $3.2 billion. This surge was primarily fueled by strong demand from cloud service providers and a 59% jump in combined revenue from storage, software and services.

Lenovo’s Solutions and Services Group (SSG) maintained its momentum, posting its 13th consecutive quarter of double-digit growth and boasting an operating margin exceeding 20%.

CEO Yuanqing Yang emphasized the company’s readiness to capitalize on the burgeoning AI market.

“We are both well-prepared and uniquely positioned in the market with our full-stack AI portfolio to lead in the era of hybrid AI,” Yang said.

The tech firm is betting heavily on AI-enabled devices, expecting AI PCs to comprise over 50% of the PC landscape by 2027. Lenovo also highlighted its recent strategic collaboration with Alat, a subsidiary of Saudi Arabia’s Public Investment Fund, aimed at expanding its Middle Eastern presence and diversifying its supply chain.

AI in Banking Reveals Gap Between Institutions and Consumers

Financial institutions are racing to embrace AI, but consumers aren’t quite as enthusiastic, according to a new study by Alkami Technology Inc.

The research, released Wednesday (Aug. 21), found that 96% of regional and community financial institutions (RCFIs) believe AI will play a critical role in their operations within the next five years. In contrast, only 61% of consumers expect AI to influence their banking interactions significantly.

“Many financial institutions are beginning to understand the potential for AI across the range of their operations,” said Allison Cerra, chief marketing officer at Alkami, in a news release. “The study reveals the more common applications for AI today and where RCFIs believe AI will have the biggest impact in banking.”

Most financial institutions surveyed (78%) view AI as a catalyst for new business opportunities. Additional expected benefits include time savings for employees (77%), reduced operational costs (59%) and revenue growth (56%).

Interestingly, the study found that an institution’s size doesn’t correlate with AI progress. Only 21% of RCFIs with over $5 billion in assets successfully leverage AI in key areas, compared to 19% of those with less than $1 billion in assets.

The research also highlighted generational differences in consumer attitudes. Millennials showed the highest comfort level with AI use in banking, with 51% agreeing that their data should be used for improved digital banking experiences.

Jason Dorsey, president of The Center for Generational Kinetics, which partnered on the consumer research, emphasized the importance of education: “A key part of the path forward for RCFIs is education, and we hope this study encourages banks and credit unions to delve deeper into AI literacy and adopt a structured and strategic framework to maximize potential and navigate the inherent complexities.”

South Korea to Allow Financial Firms’ Use of AI, Cloud Computing

South Korea’s financial regulator has reportedly announced it will permit financial institutions to harness generative AI and cloud computing, marking a significant shift in the country’s approach to financial technology.

The Financial Services Commission (FSC) plans to ease network separation rules that have effectively barred financial firms from using AI and cloud services for core operations since 2013.

“Especially, network separation is being named a cause of a decline in the country’s financial competitiveness as the software market is quickly transitioning from on-premise service to cloud computing-based Software as a Service (SaaS), while the use of generative AI is changing the future of industries,” the FSC stated in a press release cited by The Korea Times.

FSC chief Kim Byoung-hwan emphasized the urgency of the move: “We are at a point where we need to improve network separation rules to better adapt to the quickly changing IT environment around cloud computing and generative AI.”

Under the new guidelines, financial firms can utilize AI and cloud technologies once they implement and verify adequate security measures with regulatory bodies.

The FSC aims to roll out these changes “before the year’s end at the earliest,” potentially revolutionizing product development and customer service in South Korea’s financial sector.