ZTE profit climbs on 4G projects, overseas smartphone demand

Shenzhen-based telecommunications equipment supplier has reported a 29.8pc increase in net profit for the six months ended June 30

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ZTE was the world’s eighth-largest smartphone supplier in the first quarter on shipments of 12.1 million handsets, cornering a 3.2 per cent market share behind Xiaomi and ahead of Lenovo Group, according to Counterpoint Research. Photo: Reuters

Published: 8:45pm, 19 Jul 2017Updated: 3:55pm, 19 Aug 2017

ZTE Corp, mainland China’s largest-listed telecommunications equipment manufacturer, has reported a 29.8 per cent year-on-year increase in net profit for the six months ended June 30, driven by steady 4G infrastructure demand and renewed growth in its smartphone business.

Shenzhen-based ZTE saw its interim net profit reach 2.3 billion yuan (US$340 million), up from 1.8 billion yuan in the same period last year, as “domestic carriers continued to invest in transmission and access systems for 4G projects”, said company chairman Yin Yimin in a preliminary financial results announcement on Wednesday.

Revenue advanced 13.1 per cent to 54 billion yuan from 47.7 billion yuan a year ago.

Shares in ZTE rose 3.5 per cent to reach HK$18.90 at the close of trading in Hong Kong.

ZTE is expected to benefit hugely from 5G-related capital spending on the mainland over the next decade, according to a study published last month by the China Academy of Information and Communications Technology. Photo: Handout

The company, the world’s fourth-largest telecommunications equipment supplier by revenue, has seen its share price climb since emerging from US sanctions purgatory on March 8 this year. Its shares hit a two-year high of HK$19.20 on June 23.