ZTE reports H1 2024 revenue of RMB 62.49 billion and net profit of RMB 5.73 billion

• ZTE reported H1 2024 revenue of RMB 62.49 billion, and net profit of RMB 5.73 billion, reflecting a 4.8% year-on-year increase
• Embracing AI, deepening "connectivity + computing", and driving the high-quality growth
• Government-enterprise and consumer businesses returned to a fast growth trajectory, with revenues increasing by 56.1% and 14.3%, respectively
• R&D expenses totaled RMB 12.73 billion, representing 20.4% of operating revenue

Shenzhen, China, 16 August 2024 - ZTE Corporation (0763.HK / 000063.SZ), a global leading provider of integrated information and communication technology solutions, today announced a revenue of RMB 62.49 billion for the first half of 2024, representing an increase of 2.9% year-on-year.

According to ZTE's results announcement today, in H1 2024, the net profit attributable to holders of ordinary shares of the listed company reached RMB 5.73 billion, up 4.8% year-on-year. The net profit after extraordinary items attributable to holders of ordinary shares of the listed company for the same period was RMB 4.96 billion, indicating a year-on-year rise of 1.1%. Basic earnings per share was RMB 1.20. Net cash flows from operating activities increased by 8.9% to RMB 7.00 billion, compared to the same period last year.

In the first half of 2024, despite a complex external environment, a new wave of technological revolution and industrial transformation driven by artificial intelligence accelerated. Emerging technologies, applications, and business models such as AIGC, 5G-A, and the low-altitude economy continued to develop. ZTE remained committed to technological innovation and to the synergy of "connectivity + computing" contributing to stable overall performance, with growth achieved in both revenue and net profit.

During the period, in the operator network segment, domestic growth was under pressure due to the overall investment environment, while internationally, the company continued to achieve breakthroughs with major countries and large telecom operators, maintaining double-digit growth. Meanwhile, ZTE focused on expanding its government-enterprise and consumer businesses, significantly broadening its market presence, with revenues from both sectors returning to a fast growth trajectory, increasing by 56.1% and 14.3%, respectively.

In the first half of the year, the company achieved RMB 43.06 billion in domestic revenue, representing 68.9% of the total, and RMB 19.43 billion in international revenue, accounting for 31.1%. The revenues from the operator network, government-enterprise, and consumer businesses were RMB 37.30 billion, RMB 9.17 billion and RMB 16.02 billion respectively, making up 59.7%, 14.7%, and 25.6% of the total.

During the period, ZTE's R&D expenses totaled RMB 12.73 billion, accounting for 20.4% of operating revenue. The company has filed over 90,000 global patent applications and holds a total of 46,000 granted patents worldwide. In the AI field alone, ZTE has approximately 5,000 patent applications, with more than 2,000 patents granted. These efforts continue to drive the company's market competitiveness in the wave of digital intelligence.  

In the connectivity domain, ZTE achieved continuous innovation and iteration in its products and solutions during the first half of the year. The company extended its long-standing technological advantages to next-generation ICT technologies such as 5G-A and all-optical networks. According to the latest industry data, ZTE's shipments of 5G base stations and 5G core networks rank second globally. Its RAN and 5G core network products consistently receive industry leader ratings from multiple institutions, while its optical network products achieved the highest quarter-on-quarter growth rate in global market share. Simultaneously, ZTE's 50G PON solutions have been tested and piloted by over 50 operators worldwide, and the company has achieved the first large-scale commercial deployment of a 400G all-optical inter-provincial backbone network in partnership with operators.

In the field of computing, ZTE has leveraged its years of expertise in communication software and hardware development, engineering capabilities, and industrialization to intensify its investment in computing power products and solutions. The company has launched a comprehensive suite of full-stack, full-scenario intelligent computing solutions, covering computing, networks, capabilities, intelligence, and applications. These solutions include a full range of general computing servers, high-performance AI training servers, inference servers, liquid-cooled servers, distributed storage systems, high-end multi-control magnetic arrays, integrated training-inference machines, and high-speed lossless switches.

In the terminal sector, ZTE has introduced the strategic concept of "AI for All", focusing on five core consumer scenarios: sports & health, audio & video entertainment, business & travel, home & education, and smart driving. The company has launched a full range of AI-driven terminal products, including smartphones, tablets, laptops, and mobile internet devices, as part of its Full-Scenario Intelligent Ecosystem 3.0. This ecosystem promotes the integration of AI technology across mobile terminal devices, smart home devices, cloud computing, and automotive electronics. In terms of market performance, ZTE holds the No.1 position in the global 5G FWA & MBB market. RedMagic continues to lead as the top-selling brand in the global gaming smartphone market.

Moving forward, ZTE is dedicated to advancing its core technological innovations and accelerating its expansion into the "connectivity + computing + capability + intelligence" domain. The company will focus on strategically strengthening its digital and intelligent infrastructure. By fostering open collaboration and pursuing diverse, mutually beneficial partnerships, ZTE aims to build a highly efficient and intelligent digital future with industry partners.