Huawei, ZTE maintain wireless growth

Caroline Gabriel/Rethink Wireless
02 Feb 2011

The major Chinese vendors continue to breathe down the neck of the wireless incumbents, reporting solid growth in their preliminary 2010 financial results.

Huawei's as-yet unaudited report indicates a 28% rise in full year revenue to $28 billion, not far behind Ericsson's $31.1 billion, while ZTE is set to turn in a 16.7% year-on-year increase to $10.62 billion.

Huawei has made strong progress in LTE and HSPA in Europe as well as its traditional strongholds in China and emerging economies, but remains excluded from the largest north American infrastructure deals, despite its relationship with Clearwire.

It is making some progress in the US with its handsets, and its mobile device business grew by 22% overall in 2010, reaching $4.5 billion.

ZTE's handset business has shown stronger growth than its compatriot's and it entered the global top four in the fourth quarter, according to IDC, coming in behind Nokia, Samsung and LG.

In Q4, it achieved a 76.8% year-on-year rise in unit shipments to 16.8 million, the biggest percentage leap of any handset maker apart from Apple.

Most of this expansion has been based on featurephones but it has been steadily moving into developed economies and into affordable or midrange smartphones, and plans a tablet soon.

The firm said that net profit attributable to shareholders grew 32.4% to $491.4 million.

ZTE is less prominent in infrastructure than Huawei but has been scoring LTE trials with western operators as well as growth in its more traditional markets - emerging economies, especially with CDMA, and its software defined base stations. For 2010, these revenues were up 16.7% to $10.7 billion.

It will certainly outperform the infrastructure sector, where Ericsson saw its full year revenues fall by 1.6% to $31.3 billion and Nokia Siemens scraped a 1% increase to $17.4 billion.

Alcatel-Lucent reports on February 10, with analysts expecting revenues around $21.3 billion, indicating the growing gulf between Ericsson and Huawei at the top, and the rest of the pack.

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