Chinese equipment vendor ZTE’s profitability and operator network sales dropped for a second consecutive period, while gains in its consumer and enterprise units drove double-digit revenue growth in H1.

In the operator network segment, ZTE explained it mitigated the impact of a domestic 5G capex slowdown by consolidating its core operator business base and achieved steady gains in market share for key products.

Operator network revenue decreased 6.2 per cent to CNY35.1 billion ($4.9 billion), accounting for 49 per cent of total revenue, down from nearly 60 per cent a year earlier. A year ago the segment dropped 8.8 per cent.

Its government and enterprise business unit more than doubled its revenue to CNY19.3 billion, driven in large part by server and storage sales jumping 200 per cent.

Consumer business sales rose 7.6 per cent to CNY17.2 billion, aided by 30 per cent growth in international revenue from its smartphone business.

Domestic revenue grew 17.5 per cent to CNY50.6 billion, representing 70.7 per cent of total sales (up from 68.9 per cent in H1 2024). International sales increased 7.8 per cent to CNY20.9 billion.

Net profit tumbled 17.4 per cent year-on-year to CNY4.1 billion, while total revenue improved 14.5 per cent to CNY71.6 billion. Q1 profit dropped 10.6 per cent to CNY2.4 billion.

R&D expenses were stable year-on-year at CNY12.7 billion and accounted for 18 per cent of operating revenue.