ZTE said its full-year profit jumped 32 percent to $494 million, up from $374 million in 2009, thanks in large part to a strong boost in overseas sales. The Chinese equipment vendor and handset maker also said its fourth-quarter net profit jumped nearly 49 percent.
For all of 2010, ZTE said revenue clocked in at $10.67 billion, up 17 percent from $9.16 billion in 2009. The results were in line with the preliminary figures the company released in January. ZTE CFO Wei Zaishen recently said he expects the company's growth in 2011 to be at least as robust as in 2010.
ZTE said that for the first time, the U.S. and European markets contributed the largest portion of its total overseas revenue. The company said these markets recorded year-on-year growth of 50 percent, accounting for 21 percent of ZTE's total operating revenue.
So far ZTE has been able to expand in Europe but has been stymied in its attempts to crack the U.S. equipment market. ZTE and its larger Chinese rival Huawei lost out on a multibillion-dollar network modernization contract with Sprint Nextel (NYSE:S). Sprint selected Alcatel-Lucent (NASDAQ:ALU), Ericsson (NASDAQ:ERIC) and Samsung for the deal, which is worth $4 billion to $5 billion, and is expected to take three to five years to complete. ZTE has said it feels it was excluded for political reasons amid a swirl of concerns about possible national security risks posed by Chinese companies building U.S. telecommunications networks.
Nevertheless, ZTE found greater success in the handset market. According to research firm IDC, ZTE claimed the world's No. 4 handset spot in the fourth quarter, nudging Apple (NASDAQ:AAPL) down to No. 5 and pushing BlackBerry maker Research In Motion (NASDAQ:RIMM) out of the list of top five handset makers altogether. ZTE muscled its way into the rankings by shipping 16.8 million units in the quarter, up 76.8 percent from the year-ago period--the highest growth rate of any of the biggest handset makers except for Apple. ZTE has found favor with U.S. carriers, especially for low-end devices. However, ZTE wants to expand its lineup of smartphones in the U.S. market this year.
- see this release
- see this WSJ article (sub. req.)
- see this Reuters article
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