ZTE’s Q3 net profit soared 191 per cent to CNY703 million ($114 million), as a 40 per cent jump in handset sales helped fuel a 24 per cent increase in total company revenue to CNY21.1 billion.
The Shenzhen-based company said it also had strong revenue growth in 4G network gear. Key growth markets were Europe, North America, Japan and China.
For the first nine months of the year, its profit increased 232 per cent to CNY1.83 billion while revenue was up 8 per cent to CNY58.8 billion.
The company noted that revenue from handset terminals “was largely unchanged” in the first nine months of the year (compared to a year earlier) but operator network equipment sales increased by 13 per cent, with the growth driven by TD-SCDMA, TD-LTE and FDD-LTE gear. Revenue from software systems and services rose 6.63 per cent.
R&D spending during the nine months increased 61 per cent to CNY2.4 billion, which is 11.5 per cent of its total revenue.
The company’s earnings per share rose 185 per cent to CNY0.20. To reduce its debt financing, ZTE has proposed finding financing of up to CNY2 billion in overseas markets.
The company is bullish about the future. ZTE forecasts full-year net profit will be between CNY2.5-2.8 billion in 2014, representing year-on-year growth of between 84.1-106 per cent.