Less than a month after reporting a loss of CNY2.36 billion ($343 million) in 2016 due to fines by the US government, Chinese vendor ZTE bounced back in Q1 2017 with a sharp rise in net profit and strong growth in revenue across its smartphone and carrier businesses.

The company’s net profit rose 27.8 per cent year-on-year in Q1 to CNY1.21 billion on revenue of CNY25.75 billion, an increase of 17.8 per cent.

In March, ZTE was removed from a list of blocked companies by the US Commerce Department, following the company’s admission of guilt for violating sanctions on Iran. ZTE CEO Zhao Xianming said at the time it is “turning the page on a challenging chapter in our past and is optimistic of our future”.

Soon after admitting violating US trade sanctions, ZTE reported a net loss for 2016 after making provision for the $892 million fine. “Without the provision, ZTE would have posted a net profit of CNY3.83 billion, 19.2 per cent higher than a year earlier,” it stated.

ZTE doesn’t provide a breakdown by business unit for quarterly earnings (segmentation data is only available for half-year and annual reports), but the company said carrier network and smartphone sales were the main drivers for its top-line growth in Q1.

For smartphones it posted year-on-year growth in the US, Germany, Russia and Australia, it said. In February it introduced an upgraded version of the Axon 7, its first device compatible with Google’s Daydream VR headset.

The company said it allocated nearly 13 per cent of revenue for R&D in the January to March period. ZTE said in a statement its pre-5G products are deployed in more than 40 networks in 30 countries.

As part of its ‘big video’ push, shipments of set-top-boxes grew by more than 25 per cent during the quarter.