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"Two sides" in the financial report: ZTE: half of the flame and half of the sea

via:博客园     time:2018/10/26 20:32:12     readed:303

On October 26, ZTE announced its third quarter results for 2018 and its 2018 annual results forecast. According to the report, ZTE's revenue for the third quarter of 2018 was RMB 19.3 billion, net profit was RMB 560.45 million, and net profit decreased by 65% ​​year-on-year.

Fall into a quagmire

It is undeniable that ZTE has experienced a nightmare that most companies can't think of and can't think of.


A few months ago, the photo of the founder of ZTE, Hou Weigui, was widely spread at the airport. The 76-year-old Hou Weigui retired in 2016 and re-emerged at ZTE’s life and death time to lobby for ZTE.

Everything happened later: ZTE paid a $1 billion fine and placed the previously agreed $400 million deposit on a US bank. The US Department of Commerce lifted the ban on ZTE. After 89 days, ZTE finally breathed a sigh of relief.

In the 89 days, ZTE’s 34-year history was only a short period of time, but it brought an incalculable impact to ZTE.

In the unaffiliated ZTE's first quarter of 2018, ZTE's first quarter revenue was 28.88 billion yuan, up 12.18% year-on-year. The net profit attributable to common shareholders of listed companies was 1.687 billion yuan, up 39.01% year-on-year. Good growth potential.

However, after considering the impact of the fine, ZTE’s first-quarter results after the July update showed that ZTE’s operating income during the period was 2.753 billion yuan, a year-on-year increase of 6.92%; the net profit loss was 5.407 billion yuan.

This is also the main theme of ZTE in 2018: loss. In the first three quarters of 2018, ZTE lost 7.26 billion yuan, down 285.92% year-on-year. At the same time, ZTE estimated that the full year loss in 2018 was 6.2 billion yuan to 7.2 billion yuan. In 2017, ZTE's profit was 4.568 billion yuan.

Lei Feng Network expects that to eliminate the financial pressure brought by the fine, ZTE needs to maintain its current profitability at least until the end of 2019.

Lei Feng.com learned from ZTE’s third-quarter earnings report that ZTE’s top ten shareholders realized “three-in and three-out”, and China Ping An Life Insurance Co., Ltd.-Universal-Personal Insurance, China Ping An Life Insurance Co., Ltd. The company - Investment Link - Individual Insurance Investment Company and Haitong Securities Co., Ltd. accounted for 1.04% of the total share capital.

Newcomers are the National Social Security Fund Group One, the National Social Security Fund 161 and the National Social Security Fund Group, which account for 1.4% of the total share capital.

In addition, ZTE has applied for a comprehensive credit line of RMB 30 billion from Bank of China Co., Ltd. and applied for a comprehensive credit line of USD 6 billion from the Shenzhen Branch of China Development Bank.

Still capable of hematopoiesis

On July 13, 2018 (US time), & nbsp; refusal order was issued, BIS terminated the refusal order of April 15, 2018 and removed ZTE and ZTE from the list of banned exporters. In addition, ZTE's headquarters building on the LED screen "Unlocked!" It hurts! Go on the journey again! The words "and" can not help but sigh under the circumstance, where is ZTE's road ahead?


In the third quarter of ZTE’s loss report, Lei Feng found that ZTE’s third-quarter R&D expenses were 3.465 billion, up 37.47% year-on-year. ZTE explained that the Group’s current 5G wireless and core Investment in core technology areas such as network, bearer, access, and chip.

In addition, from July to September 2018, ZTE's sales expenses were 1.912 billion yuan, a year-on-year decrease of 37.49%, mainly due to the strengthening of cost control during the reporting period. Obviously, ZTE is opening up and reducing expenditures in order to recover quickly, and spare no effort in research and development also shows ZTE's determination for the 5G era.

ZTE’s new CEO Xu Ziyang said at the end of August that ZTE plans to return to normal growth in 2019 based on business recovery in 2018. It will continue to rank in the first camp of 5G and seize 5G large-scale commercial opportunities in 2020. And achieve rapid development. At the same time, he also said that the company is concentrating resources on 5G construction and reducing the investment in non-main channel products. The current cost of investing in 5G mainly comes from R&D expenses and profits generated by other businesses.

Before the ban was banned, ZTE’s flag was “5G Pioneer”. Shortly after the restoration, ZTE’s test results showed that it was not dropped in the 5G main channel. In the third phase of the China 5G technology R&D test organized by the IMT-2020 (5G) promotion group, ZTE was the first in the industry to complete SA. In the model of the 3.5GHz system base station test, all the tests of the NSA low-frequency point have been completed, closely following the 5G commercial time planning.

From the perspective of the market environment, the industry has gradually entered the 5G investment cycle, and the trillion-level market space has begun to be released. In this round of rising market, ZTE is expected to quickly restore its position as the world's fourth-largest telecom equipment supplier with 5G. The endogenous hematopoietic capacity for 5G has not been greatly affected. The paper loss is only temporary, and the 5G order will largely determine the recovery time of ZTE.

For ZTE, the most need and the least can not afford? & mdash; & mdash; time.

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