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Chinese kit maker posts 17.8% rise in revenue; talks up 5G progress.
ZTE on Tuesday reported a 27.8% rise in first quarter net profit, driven by growth in carrier network and smartphone sales.
Net profit attributable to the Chinese kit maker’s shareholders came in at 1.21 billion yuan (€164.98 million) for the three months to 31 March, up from CNY949.51 million a year earlier.
Revenue increased to CNY25.74 billion from CNY21.86 billion, while operating profit jumped to CNY764.06 million from CNY314.24 million.
"Carriers continued to enhance indoor coverage and depth of coverage of 4G networks during the reporting period while actively driving 5G development and stepping up with transformation towards digitalisation," said ZTE, in a statement.
As for its consumer products business, which includes smartphones, "the group made further inroads in the global carriers’ market. While increasing our profitability, we have also expanded our ability to operate in the open market and enhanced our brand position."
As well as its strong financial growth, ZTE also talked up the progress it is making with the development of 5G technology.
The company’s pre-5G products are now deployed in more than 40 networks in 30 countries. It is on track to begin pre-5G commercial deployments in the third quarter of 2018, with full commercial deployment from 2019.
A strong first quarter performance is the ideal tonic for what has been an inauspicious start to 2017 for ZTE.
In early March, ZTE settled an investigation into its illegal shipments of network equipment to Iran and North Korea, agreeing to pay a $1.19 billion (€1.13 billion) fine to U.S. authorities.
"Looking forward, ZTE will proactively pursue new growth opportunities, with the company continuing to strengthen its ongoing commitment to R&D and rigorous operation management," the vendor said on Tuesday. "ZTE will also deepen its collaboration with partners and customers to build healthy and sustainable industry ecosystems and mutually beneficial relationships."
