ZTE announced revenues of CNY 86.25 billion for 2011, up 23.4 percent from a year earlier. Revenues in its home market China rose 22.7 percent to CNY 39.50 billion, and sales overseas increased 24 percent to CNY 46.76 billion. Growth was led by its expansion in handsets and tablets, with revenues from terminal devices up 52.6 percent to CNY 26.93 billion. ZTE also had over 30 commercial LTE contracts by year-end and was working with over 100 operators on test networks for the new technology. Operating profit fell to CNY 3.94 billion from CNY 5.04 billion amid a sharp increase in R&D spending and sales and distribution costs. The company's net profit fell 36.6 percent to CNY 2.06 billion, also hurt by a rise in financing charges. This year the company said it targets a transition from focusing on products to providing total solutions. This includes targeting more the government and enterprise sectors, while also growing sales to carriers. CEO Shi Lirong told Chinese news agency Xinhua that profits came under pressure last year from the low gross margin on handsets. The company will work on improving the margin and restoring group profits to 2010's level this year, he said.
