ZTE reported revenues for the six months of 2019 up 13.1 percent to CNY 44.61 billion, while net profit more than doubled to CNY 1.47 billion. The company said it expects net profit over the first nine months of the year to grow to CNY 3.8-4.6 billion, helped in part by a real estate sale.
The results show a sharp turnaround from the first quarter of the year, when ZTE reported revenues down 19 percent year-on-year. The Chinese equipment maker also had a particularly difficult H1 2018, when it was subject to a ban on sales to the US.
The company also ramped up R&D spending this year, to 14.5 percent of revenue in the first half compared to 13.9 percent in Q1.
Networks growth, consumer lower
The growth in H1 was led by its carrier networks division, which increased sales 38.2 percent to CNY 32.5 billion. Consumer revenues continued lower, down 35.4 percent to CNY 7.4 billion, as the company's first 5G phone launched only late in the period. Revenues in the enterprise and government segment rose 6 percent to CNY 4.7 billion.
Revenue in its home market China rose 6.5 percent to CNY 27.4 billion, or 61.5 percent of the total. International revenues were up a stronger 25.6 percent to CNY 17.2 billion, led by a doubling of sales in Africa and 83 percent growth in the rest of Asia. Sales in Europe and the Americas fell 18.1 percent to CNY 6.7 billion or 14.9 percent of the total, down from a 20.6 percent share a year earlier.
