ZTE on Thursday reported impressive growth in first quarter revenue and net profit thanks to strong demand for 4G equipment, particularly in China.
The Chinese vendor generated revenue of 21 billion yuan (€3.1 billion) in the three months to 31 March, up 10.2% on last year. Net profit attributable to shareholders increased 41.9% to CNY883 million (€131.8 million).
"The development of the global telecommunications industry benefited mainly from the large-scale deployment, capacity expansion, performance optimisation and in-depth coverage of 4G networks, as well as the construction of ancillary equipment and facilities for these networks," said ZTE, in a statement.
Revenue at ZTE’s carrier networks division increased by 8.92% on-year, while services revenue surged 23.4%. Handset revenue grew 7%. ZTE did not provide figures for exactly how much revenue each of these divisions generated.
"In the domestic market, the issue of LTE FDD licences has driven further increase in investments in overall network equipment, while the implementation of the broadband China strategy coupled with increasing demand for the upgrade of existing wireline broadband networks has ushered in a phase of relatively rapid development for wireline broadband networks," ZTE said.
In late February, China’s Ministry of Industry and Information Technology (MIIT) formally issued China Telecom and China Unicom with full FDD LTE licences, enabling them to roll out hybrid FDD/TDD networks. They had until then been limited to trial licences covering major cities.
Meanwhile, the Chinese government has stated its intention to reach nationwide broadband coverage by 2020 – it’s so-called ‘Broadband China’ initiative. The government estimates that achieving this objective will cost CNY2 trillion (€300 billion).
