ZTE hit by slow growth in telco spending

ZTE hit by slow growth in telco spending

26 APR 2013
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Chinese vendor ZTE reported a tough start to 2013, noting a “slow growth in investments in equipment by the global telecommunications industry during the reporting period”.

While the company reported a profit for the period, after losses in the prior sequential quarters, its bottom line was flattered by an asset sale.

It reported a net profit of CNY205 million ($33.3 million), up 35.9 per cent on the prior-year profit of CNY105.9 million, on revenue of CNY18.1 billion, down 2.8 per cent from CNY18.6 billion.

However, excluding extraordinary items, it saw a loss of CNY615.5 million, compared to a prior-year profit of CNY89.2 million.

ZTE saw CNY820.5 million of gains from extraordinary items, including a significant income from the sale of its stake in “surveillance supplier” Shenzhen ZNV Technology (ZNV).

LTE rollouts are gaining pace, ZTE said, while national broadband strategies adopted by various nations are driving the construction of fixed networks.

In its home market, it noted “relatively fast growth in equipment investment”, with large-scale TD-LTE deployments a driving factor. Internationally, it said it “continued to focus its efforts on major populous nations and leading carriers”.

On the devices front, it said that “market demand for smart terminals continued to increase”.

Looking ahead, it said it expects investment by the industry to focus on “broadband conversion of wireless and wireless networks and the construction of ancillary facilities”.

It said it will continued its focus on “innovation and solution-based operations with a strong focus on mainstream products and improved R&D efficiency” and reinforcing its efforts for “populous nations and mainstream carriers”.


Steve Costello

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