ZTE Corporation (0763.HK / 000063.SZ), a major international provider of telecommunications, enterprise and consumer technology solutions for the mobile internet, today has reported a full-year revenue of RMB 114.5 billion in 2021, 12.9% higher than a year earlier.
According to ZTE’s results announcement today, in 2021, the company’s net profit attributable to holders of ordinary shares of the listed company reached RMB 6.8 billion, up 59.9% year-over-year. The net profit after extraordinary items attributable to holders of ordinary shares of the listed company for 2021 amounted to RMB 3.3 billion, representing a year-on-year rise of 219.2%. Basic earnings per share was RMB 1.47. During the period, the company’s net cash flow from operating activities was RMB 15.7 billion, 53.7% rise year-on-year.
The year 2021 was crucial for ZTE’s growth phase. During the year, the company, although confronted with the global COVID-19 pandemic and complex external environment, kept solidifying its position with innovative initiatives while maintaining steady operations. While consolidating the company’s core competitiveness, ZTE furthered its digital transformation and continued to expand its capability and transaction boundaries. During the period, the company witnessed significant improvement in its corporate operational quality, with key financial indicators such as operating revenue, net profit and net cash flow from operating activities hitting the highest in the company’s history.
In 2021, the company insisted on building stronger core competence by strengthening R&D investment in key areas like core underlying technology and 5G digitalization. ZTE’s R&D investment reached RMB 18.8 billion in 2021, covering 16.4% of the year’s revenue, rising by 1.8 percentage points on a year-on-year basis.
In 2021, the company’s domestic and international markets and three major businesses including operator network, government and enterprise and consumer business all achieved a year-on-year growth. The company’s operating revenue of domestic market in 2021 was RMB 78.1 billion, a year-on-year increase of 14.7%, accounting for 68.2% of its overall revenue while the revenue from international market was RMB 36.5 billion, a year-on-year increase of 9.1%, covering 31.8% of its overall operating revenue.
In terms of operator networks, in 2021, the company was deeply engaged in the large-scale 5G and digitalization constructions in China, and continued to consolidate its position as a strategic supplier, while exploring high-value overseas market. In 2021, ZTE made further progress in its healthy operation, achieving an annual operating revenue of RMB 75.7 billion, a year-over-year rise of 2.3%, in operator networks.
In terms of government and enterprise business, ZTE seized market opportunities such as new infrastructure construction, industrial digital transformation and dual-carbon economy. The company focused on its core products and industry-leading customers while strengthening its channel management, thereby achieving rapid growth on an overall basis in such industry markets as energy, transportation, government affairs, finance, internet and so forth. Thus, the annual operating revenue generated from its government and enterprise business across the globe increased 16.0% to RMB 13.1 billion in 2021, with its operating revenue from domestic market seeing an increase by over 40% YoY. Among them, the operating revenue of its servers and storage products doubled year-on-year, and products such as data center and GoldenDB distributed database have been deployed by industry-leading enterprises on a large scale, enhancing ZTE’s brand image among government and enterprise customers.
In terms of consumer business, ZTE strengthened its commitment to new initiatives in brand, product, and channel, promoting the sales of personal and home products. The company achieved an annual operating revenue of RMB 25.7 billion, an increase of 59.2% YoY in consumer business, of which, the home terminals increased by more than 80% YoY while its mobile phone products increased by nearly 40% YoY, in terms of operating revenue.
In 2022, the first year of the company’s expansion phase, ZTE,upholding the principle of “Simplicity prevails, agility and openness make success”, will adhere to sustainable development, continuously pursue stronger core competence, and further optimize its market structure.
The company will continue to invest in core technologies such as chipsets, algorithms and network architecture to maintain its technological leadership in key areas and increase its shares of high-value markets, with an aim to achieve the steady development and further consolidate its business in the first curve. At the same time, the company will strengthen its business expansion in IT, digital energy and smart home, actively rev up its business growth in the second curve, and inject more impetus into its high-quality growth.
ZTE will continue to deepen its own digital transformation, and accelerate innovation accumulation and solution iteration while improving its production and transaction efficiency. Furthermore, the company will actively strengthen mutual collaboration with customers, industries and ecological partners, expecting to achieve win-win situations.
Moving forward, with great commitment to its original vision, ZTE will team up with its partners to make great strides towards their win-win future.