And according to ZTE insiders revealed that the current focus of ZTE 5G construction, other lines of business are tightened accordingly, personnel leave is normal, the interior will be called personnel optimization. In addition, affected by the "embargo incident", friends and businessmen at home and abroad are "digging the wall foot", many people collective job-hopping also occurred.
More than a month ago, ZTE released its semi-annual report, which was unexpectedly bleak: revenue fell 27%, a loss of 7.8 billion yuan, and a year-on-year fall of 441%. Although high-level insists that there is no core R&D brain drain, but staff salaries and wages and welfare expenditures have dropped significantly year-on-year, there is bound to be staff mobility.
It has been 100 days since the resumption of operation. What is the resurgence of ZTE's "internal and external troubles"?
Internal announcement of ZTE Beijing Institute (Sina Technology Photo)
On the eve of the "embargo incident", the ZTE Beijing Research Institute moved into the building of Sinotrans mansion. Today, the smell of decoration has not yet dispersed.
Outside the eight-storey elevator stood a striking notice: the company's business secrets related to the competitiveness of the company, is essential to the company's development. A small number of people use commercial secrets outside the part-time job, entrepreneurship, the use of collective warfare for personal interests, and even act as an adversary of the interior...
ZTE insiders said that after the embargo, ZTE has fallen out of the top four of the global equipment manufacturers in three months, the situation is not optimistic, the internal management system has been strengthened to prevent restrictions.
Time goes back to August 30th this year. That evening, ZTE released its semi annual report in 2018. During the reporting period, the company's operating income was 39.434 billion yuan, down 26.9% year-on-year; the net profit attributed to the common shareholders of listed companies was negative 7.824 billion yuan, down 441.24% year-on-year.
As for the reasons for the sharp decline in profits, ZTE explained that the main reason is a $1 billion fine and the main business activities can not be carried out caused by business losses, losses incurred in advance.
So far, ZTE has been trying hard to catch up with the outside world.
ZTE CEO Xu Ziyang said that the current production has returned to normal, research and development progress has caught up with the target set at the beginning of this year, 5G testing progress fully catch up with the national testing progress, after-sales service capacity fully restored.
Xu Ziyang's argument was verified in the staff's mouth.
A senior ZTE official told Sina Technologies that it took only 24 days for the company to keep pace with other vendors after restarting its business, and basically completed the tests within two months. ZTE has returned to the 5G first echelon, with some of the results leading.
"The vast majority of our customers are still confident and willing to continue to support the company," the senior said, after the "embargo incident", Italy, Germany and other customers have expressed their desire to strengthen cooperation, "at present we are in-depth discussions with mainstream global suppliers, looking for more opportunities for cooperation."
But analysts also denied the claim. Some analysts believe that good faith is the first principle of cooperation in many countries, the incident caused a lot of irreversible damage, trust needs to be re-established, "not too soon, it takes time."
To be sure, ZTE's strategy has been adjusted accordingly. 5G is the main channel and key business, and other businesses have tightened investment.
To the outside world, the mobile phone business is relatively competitive in the mainstream of ZTE. Especially in the domestic market, many struggles can not get rid of the predicament, and the sense of existence is very low.
ZTE's flagship sales in Tmall flagship store are dismal.
Mobile phone sales also reflect the seriousness of the problem. Not long ago, ZTE released its flagship product, Tianji Axon 9 Pro, which it claimed was awarded "Best Visual Effect Phone" by foreign media. But up to now, the product has only sold more than 80 units in Tmall Zhongxing official flagship store.JD.COMThe number of comments is only 40, and it is even difficult to find out the evaluation information of the mainstream media.
From the survey data, we can see that ZTE mobile phone is no longer the top five. Although it occupies a certain share in the international market such as North America, it is not directly proportional to the annual capital investment.
Perhaps because of this, mobile terminal development is difficult to escape when adjusting business. Relevants told Sina Technologies that ZTE has different levels of staff adjustment in its R&D centers in China, and the Nanjing Research Institute, which mainly develops mobile phone terminals, is optimizing staff, including merger and reduction of staff in addition to direct layoffs. However, due to the complex structure of the company, the number of employees can not be calculated.
Employee salaries and wages and benefits fell sharply (sina science and technology mapping)
Earlier, ZTE CEO Xu Ziyang insisted that "the business suspension did not cause the loss of core R & D personnel." However, it is not difficult to see from the semi-annual report that the salary expenditure of employees decreased by 18% compared with the same period last year, and the "wages, benefits and bonuses" expenditure in the "R&D expenses" also decreased by 27%.
The industry believes that the staff salary and wage and welfare expenditure has fallen sharply, is bound to be affected by the loss of staff.
Another media report, ZTE set up in March this year, ZTE intelligent terminal Co., Ltd. will be split, the original target of independent listing failed.
Obviously, in OV, millet andHUAWEIIn the domestic mobile phone market dominated by ZTE, ZTE mobile phones do not have any advantages, but they will not die out easily.
This personage analysis, ZTE wants to be based on the development of 5G, terminal as an important link is essential, but will not be a key business, advertising on the domestic mass market will be reduced, nor exclude the possibility of cooperation with operators or vertical industries only push the machine.
In fact, ZTE's past sales of mobile phones, whether contractual or specific models, have been impressive, and that may be its fate.
The terminal business is weak, but ZTE still has a place in the global communications industry, which has high-tech barriers, and the possibility of a short-term breakthrough for new companies is extremely low.
After the "embargo incident", partners from the domestic market extended to Zhongxing. Prior to this, the three major domestic operators announced a number of telecommunications equipment winning list, ZTE orders accumulated more than 500 million yuan.
In addition to emergency, ZTE is also saving itself.
In order to focus on 5G, ZTE shrank the assets of its subsidiaries unrelated to the main channel of 5G in the first half of this year, transferred 43.6% of its subsidiary ZTE Soft Chuang and cancelled its holding subsidiaries Dalian Zhonggang Real Estate Co., Ltd., Changchun Zhongxing New Energy Automobile Sales Co., Ltd., and Henan Zhongxing Photovoltaic Technology Co., Ltd.
In addition, there are still many industries under the name of ZTE, including the development of ZTE, which involves real estate and hotels; ZTE microelectronics, involving semiconductors; and ZTE Netcom.
However, even with 500 million large orders, there is still a huge deficit in the cash flow of ZTE.
The semi-annual report showed that cash flow from operating activities increased from negative 4.2 billion to negative 5 billion in the same period last year, with a fine of $1 billion and a margin of $400 million, plus tens of thousands of wages and partner default payments.
Fortunately, ZTE did not give up research and development under the crisis. During the reporting period, 5.06 billion yuan was invested in the R&D of 5G wireless, core network, bearer, access and chip technology.
Betting on 5G's ZTE has also made some achievements in China.
In the middle of this month, ZTE took the lead in completing the 3.5GHz system base station test under SA mode during the third phase of China's 5G technology R&D test organized by IMT-2020 (5G) Propulsion Group.
"We are the first factory in the industry to take the lead in completing 3.5G SA testing, including laboratory testing and outfield testing. In addition, it took the lead in completing all the tests of NSA low-frequency points, "Zhu Fusheng, chief engineer of ZTE's wireless operations department, told Sina Technologies that after completing the third phase of the test, it will cooperate with operators around the world to carry out 5G pre-test.commercialAnd the verification of commercial networks, "and 5G industry, commercial after doing a better killer application, the real operation of 5G, commercial operation to lay a solid foundation for success."
However, as a global telecommunications manufacturer, ZTE is facing the impact of Huawei, Nokia, Ericsson and other giants - 5G in the international battlefield has been a gunpowder smoke.
Not long ago, the three major U.S. carriers identified partners in the 5G direction, and signed a number of orders. Nokia also received nearly $4 billion in bank loans to boost R&D and reached a $3.5 billion 5G deal with operators.
Compared with the international market, China's 5G is still in the testing stage. This has also raised concerns outside the country. Is China slowing down in the construction of 5G?
According to Zhu Fusheng, China's network infrastructure is perfect, leading the world. And Xingxing's 5G strategy is "steadily advancing": first laboratory testing, outfield testing, and then into the operator scale of pre-commercial outfield, "this is a very robust way, and has historical validation."
For ZTE 5G next step planning, Zhu Fusheng disclosed that after the end of the third phase of the national test, the basic proof of the equipment has commercial capabilities, including the functionality of the equipment itself and networking capabilities, but there is still a lack of two steps: first, pre-commercial scale and commercial scale, in the next phase with the operator and large-scale testing; It is also necessary to test the application of the business, such as VR, AR, driverless, remote control and so on.
According to the prediction of relevant agencies, by 2035, the 5G market will reach 12 trillion and 300 billion. According to the forecast data of Gartner, the market share of ZTE's global wireless communication equipment will reach 22.8% in 2020.
It is not hard to imagine that before the real business of 5G, domestic and foreign manufacturers compete for R & D investment. However, how large the liquidity of 5G is and whether it can enter the mature market quickly is still in the exploratory stage.
To be sure, each manufacturer needs a long-term and large amount of investment to cope with the new 5G competition pattern. ZTE, half life, how long can it last on 5G burning money?