ZTE's Q3 profit swells 191%

Dylan Bushell-Embling
24 Oct 2014
00:00

ZTE's third quarter profit nearly tripled on the back of smartphone and 4G equipment growth.

The Chinese vendor reported a net profit for the quarter of 703 million yuan ($114.9 million), up 191% year-on-year.

Revenue grew 24% to 21.1 billion yuan, with handset sales growing 40% thanks to higher sales in key markets including China, the US and Japan. Carrier network sales also increased year-on-year thanks in part to 4G sales.

R&D sending for the quarter increased to 927 million yuan, or 11.5% of total revenue, as a result of increased spending on the operator's new Cool, Green, Open (CGO) initiative. CGO encourages changes to the vendor's operations and corporate culture.

The investments have led to innovations including a wireless remote charging solution for public transport and a 28nm process-based semiconductor. ZTE has also picked up online payment licenses in China as a step towards expansion into the mobile finance space.

For the first nine months of the year, ZTE's net profit grew 232% to 1.83 billion yuan. Revenue increased 7.8% to 58.8 billion yuan.

Based on these results, ZTE is forecasting a full-year profit of between 2.5 billion and 2.8 billion yuan, which would represent year-on-year growth of between 84.1% and 106%.

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