ZTE said it invested 14% of revenues in research and development during the quarter, while China Telecom posted strong LTE growth
ZTE posted CNY 21.86 billion ($3.37 billion) in operating revenues during the first quarter of 2016, climbing 4.1% year-over-year.
Net profit for the quarter amounted to CNY 950 million, representing a 15.97% increase vs. the same quarter the previous year. The Chinese firm said research and development investments totaled nearly 14% of total revenue in Q1.
In its carrier network market, ZTE said it experienced continued growth in traditional businesses including LTE and fiber optic networks. The company said it has focused on developing technologies and sectors such as “pre-5G/5G,” big video, software-defined networking, network functions virtualization and the “Internet of Things.” In the pre-5G/5G field, ZTE said it has carried out commercial trials in association with Japanese operator SoftBank and China Mobile.
In its enterprise business, ZTE scored contracts and commenced deployment of “Smart City 2.0” solutions in a handful of Chinese cities, including Shenyang and Huaian.
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“Smart rail transport is continuing to grow with major projects in Denmark, Greece and India,” the company noted in a statement. “ZTE continues to gain competitiveness in the smart energy sector with private power line LTE wireless networks commercialized in more than 10 cities in China and power line communication products and solutions breaking through in Africa.”
China Telecom adds 16.45M LTE subscribers in Q1
In other APAC news, China Telecom said it ended the first quarter of the year with 74.91 million LTE subscribers, posting 16.45 million net additions during the quarter. The telco’s overall customer base grew by 4.74 million during the first quarter of the year to 202.64 million customers.
“For the first quarter of 2016, the group firmly seized the 4G development opportunities and achieved rapid growth in 4G users and mobile service revenues,” China Telecom said in a statement.
China Telecom reported service revenues of CNY 76.36 billion in Q1, up 5% compared to the year-ago period. The company’s operating revenues reached CNY 86.43 billion in Q1, up 6.1% year-on-year.