Telecom Lead China: Telecom equipment maker ZTE has
warned its first-half profit could drop by 80 percent due to lower gross
margins, foreign currency exchange losses and domestic operator networks
postponing their tenders.
On Thursday, FBI has opened a criminal investigation into
ZTE over the sale of banned US computer equipment to Iran and its alleged
attempts to cover it up and obstruct a Department of Commerce probe.
A significant reduction in the euro and many emerging
currencies due to the debt crisis caused ZTE to take a foreign exchange loss,
compared to a gain in the same period a year ago.
The postponement of the network tenders also meant ZTE,
the world’s fourth-largest mobile device maker with 4.2 percent global market
share in the first quarter, missed its revenue growth target for the period.
ZTE sales up 23% to RMB 86 billion in 2011
ZTE has posted 23 percent increase in revenue to RMB 86
billion in 2011.
Net profit was RMB 2.06 billion, down 36.6 percent from
Domestic and overseas operating revenue of ZTE grew 22.7
percent and 24 percent respectively. In 2011, ZTE’s terminal products revenue
grew to RMB 26.93 billion, up 52.6 percent from the previous year.
ZTE reported operating revenue of RMB 39.50 billion from
Chinese market, accounting for 45.8 percent of operating revenue and
representing growth of 22.7 percent.