ZTE taps U.S. chief to lead worldwide device business

ZTE sign
ZTE named Cheng Lixin, who had served as president of its North America mobile devices business, to lead its worldwide mobile devices operations.

ZTE has reportedly tapped the chief of its U.S. business to lead its worldwide phone operations just a month after pleading guilty to violating U.S. trade sanctions.

Reuters said Cheng Lixin, who had served as president of ZTE North America mobile devices business unit since 2010, was named president of the Chinese company’s global mobile devices operations. ZTE has not yet announced the move officially.

ZTE last month plead guilty to violating the International Emergency Powers Act, the U.S. Department of Justice said, agreeing to pay a $287 million fine and “criminal forfeiture” of $143.5 million as well as submitting to a three-year probationary period.

The Commerce Department last year said it had uncovered plans by ZTE to use multiple shell companies to re-export controlled items to Iran, which would violate U.S. control laws. As a result, the U.S. government imposed export restrictions on the company, preventing ZTE from conducting business in the United States and working with U.S. suppliers like Broadcom and Qualcomm. But ZTE has since received multiple reprieves from those restrictions as investigations into the company continued.

ZTE is a major smartphone vendor in the United States and a major player in the international wireless industry in both network equipment and smartphones. The company earlier this week posted a 27.8% year-over-year increase in first-quarter profit thanks to increased demand for its telecom gear and smartphones, and it was the fourth-largest smartphone brand in the U.S. during the third quarter of 2016, according to Strategy Analytics.

In February, ZTE introduced the so-called Gigabit Phone, which looks to be one of the first handsets designed to support 1 Gbps speeds when it launches later this year. AT&T recently said it expects to reach peak theoretical speeds of up to 1 Gbps “at some cell sites” this year, and Sprint CTO John Saw said his company expects to approach “1 Gbps class speed boundaries, on all our licensed spectrum” using 256 QAM, massive MIMO and three-channel carrier aggregation. Meanwhile, T-Mobile CTO Neville Ray has vowed that his carrier “will absolutely be first to gigabit speeds.”