ZTE’s global strategy is paying off in the form of a 32.2% rise in profits during 2010.
A strong performance in the US and Europe helped the firm to a net profit of 3.25 billion yuan (€351 million), on revenue of 70.26 billion yuan – up 21% on 2009. More than half the firm’s revenue - 38.06 billion yuan – was derived from global operations.
The success in the US and Europe is surprising, given that ZTE faces several problems in each market. The vendor has previously claimed prejudice is holding back its business in the US, while the European Commission recently began probing allegations the vendor receives subsidies from the Chinese government.
Despite the problems, ZTE began shipping terminals through all four leading US carriers during 2010, and brokered deals with European operators including France Telecom and KPN.
R&D and most other expenses also increased as a result of the expansion efforts.
Targets for 2011 include expanding into government and enterprise segments from its traditional focus on mainstream telecom operators. The firm is also targeting similar revenue growth this year.