ZTE is likely to post net profit of between RMB 500 million ($82 million) and RMB 750 million in the first nine months of 2013.
This will be a turnaround as the Chinese telecom equipment maker posted a net loss during the same period a year earlier.
Improved gross profit margins and stringent cost controls assisted ZTE to turnaround.
ZTE said it will exercise control on resource and cost management, improve operational efficiency through implementation of the operations settlement system.
In the first half, ZTE profit increased 26.6 percent to RMB 310 million.
ZTE revenue decreased 11.9 percent to RMB 37.58 billion in the first half of 2013.
Revenue fell because of a drop in sales of GSM and UMTS products in China, and declining demand for 2G devices.
Driven by 4G, ZTE posted revenue of RMB 18.821 billion from the domestic market (China) in first half, accounting for 50.1 percent of total revenue.
International market contributed 49.9 percent revenue (RMB 18.755 billion).
ZTE reported operating revenue of RMB 19.050 billion for carriers’ networks, RMB 12.461 billion for terminals, and RMB 6.065 billion for telecommunications software systems, services and other products.
Operating revenue from terminal products decreased as a result of weaker market demand for feature phones and data cards.
ZTE revenue decreased 14.75 percent, reflecting mainly the decrease in operating revenue from service products.
Future Outlook
ZTE’s future growth will depend on the large-scale deployment of 4G networks, particularly the large-scale construction of TD-LTE networks in China.
In addition, it is betting on smartphone devices for future growth.
