Huawei boosts 2012 profit by 32%

Dylan Bushell-Embling
09 Apr 2013

Huawei yesterday reported a 32% increase in 2012 net profit 15.38 billion yuan ($2.48 billion), as rival ZTE revealed it had doubled its smartphone sales for the year.

Huawei also reported an 8% increase in sales revenue for the year to 220.19 billion yuan.

The company's core carrier network business grew revenue 6.2% to 160.1 billion yuan, while enterprise and consumer sales increased 25.8% and 8.4% respectively.

By region, China sales rose a solid 12.2% to 73.6 billion yuan, while revenue from the rest of APAC was up 7.2% to 37.4 billion yuan. Huawei also reported record revenues of 77.4 billion yuan from the MEA region, up 6.1% from 2011.

The Chinese vendor expects its revenue to grow at a CAGR of 10% over the next five years, driven by demand for improved operational efficiency among telecom network operators, and technology adoption in the enterprise and consumer segments.

Separately, ZTE announced it had more than doubled smartphone shipments in 2012. ZTE attributed the growth to strong sales in the US, as well as emerging markets such as India, Indonesia and Russia.

On the back of the sales increase, ZTE's terminals business improved its gross profit margin by 1.6 percentage points to 16.8%.

The vendor said it had generated 15% of its smartphone revenue from the year from high-end smartphones, and hopes to increases this proportion to as high as 30% in 2013.

ZTE announced a plan to transition from a B2B to a B2C business model for its terminals business, and to work with operators on developing high-end handsets and LTE broadband devices.

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