China-based equipment and device vendor ZTE reported a sharp jump in net profit for the first nine months of 2017, but revenue growth slowed to 7 per cent during the period from 13 per cent in the first six months of the year.

In line with a preliminary financial statement issued last week, its net profit increased 36.6 per cent year-on-year to CNY3.9 billion ($586 million), on revenue of CNY76.58 billion. Profit in the period was boosted by the sale of a 10.1 per cent stake in smartphone subsidiary Nubia for CNY426 million.

The profit jump is a major turnaround from 2016 when it lost CNY2.36 billion due to nearly a $1 billion settlement with the US government after admitting violating US trade sanctions.

ZTE forecast net profit for the full year reaching CNY4.3 billion to CNY4.8 billion, driven by growth in its carrier network and consumer businesses.

In the January to September period, ZTE said its R&D spending increased to CNY9.2 billion, accounting for 12 per cent of revenue.

The nine month report didn’t break out revenue by business group, but ZTE said its smartphones saw continued growth in US market share and maintained its position as the fourth-largest smartphone vendor. Compared with Q2, it said device shipments in Q3 increased significantly, particularly in Russia, Mexico, Spain and Italy.

On the mobile network said, the company said it made gains breaking into the European market, recently announcing partnerships with France-based Orange, Telenet in Belgium and Italy-based Wind Tre.

In a statement, ZTE said it “will strengthen its compliance management, in-house control…and explore new modes to maintain and improve its leading status in the 5G era”.