ZTE (000063) H2 2025 earnings summary

Executive summary

• Operating revenue grew 10.38% year-over-year to RMB133.90 billion, returning to a growth track despite industry headwinds and business mix adjustments.

• Net profit attributable to shareholders declined 33.32% year-over-year to RMB5.62 billion, with net profit after extraordinary items down 45.45%.

• The company maintained its dual-driver strategy of "connectivity + computing," investing heavily in R&D and innovation, especially in AI, 5G-A, and intelligent computing.

• Significant breakthroughs were achieved in government and corporate business, which doubled revenue, while consumer business saw steady growth in handsets and cloud PCs.

• The board proposes a cash dividend of RMB4.11 per 10 shares for 2025, subject to approval.

Financial highlights

• Operating revenue: RMB133,895.5 million, up 10.38% year-over-year.

• Net profit attributable to shareholders: RMB5,617.7 million, down 33.32% year-over-year.

• Net profit after extraordinary items: RMB3,370.4 million, down 45.45% year-over-year.

• Gross profit margin: 30.25%, down 7.66 percentage points year-over-year.

• Net cash flows from operating activities: RMB3,918.7 million, down 65.86% year-over-year.

• Basic EPS: RMB1.17; diluted EPS: RMB1.16.

• Weighted average ROE: 7.58%.

Outlook and guidance

• The company expects network investment to remain cyclical in 2026, with intelligent computing business still in incubation.

• Focus will remain on "connectivity + computing," with continued R&D in 5G-A, 6G, AI, and intelligent terminals.

• Government and corporate business is targeted as a core engine for revenue growth, leveraging opportunities in intelligent computing and digital transformation.

• Consumer business will emphasize AI-driven smart terminals and cloud PCs, aiming for global expansion and brand upgrades.