Reuters: Market News: UPDATE 1-ZTE Q4 net xxx

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UPDATE 1-ZTE Q4 net xxx Mar 25th 2012, 11:30 Sun Mar 25, 2012 7:30am EDT * Q4 net HONG KONG, March 28 (Reuters) - ZTE Corp , China's No 2 telecommunications equipment maker, posted a/an xxxx percent rise/fall in quarterly net profit, and beating/meeting/missing forecasts due to strong China telecom spending and global sales of mobile phones (positive reason)/due to weak telecom spending in Europe and narrowing margins in the mobile phone market.(negative reason). ZTE and its larger crosstown rival Huawei Technologies Co Ltd have diversified away from selling telecom equipment, a market whose growth is stagnating, to go into consumer electronics gadgets instead by making cellphones and tablet PCs. Shenzhen-based ZTE is now the world's No.5 telecom equipment maker, after Ericsson, Huawei, Nokia Siemens Networks GmbH and Alcatel Lucent SA, and the fourth largest handset maker, behind Nokia Oyj, Samsung Electronics Co Ltd and Apple Inc. <quote from statement> ZTE's fourth quarter net profit was xxx million yuan during the October-December period, up/down from 1.89 billion yuan($xxxx m/billion) a year ago and compared with a forecast of 2.18 billion yuan, according to Reuters' calculation. For the full year, net profit rose/fell xxx percent to xxx billion yuan, better/worse than a forecast of 3.25 billion yuan based on a Thomson Reuters I/B/E/S poll of 22 analysts. ZTE, which derives half its revenues from overseas market, will focus on lifting margins this year in telecom equipment sales and the cellphone sector, where it has been marketing low-cost sub-1,000 yuan smartphones to capture more market share. "It is worth noting that pricing pressure is easing in China's infrastructure market, indicating the strategy may work in 2012," said Qin Zhang, an analyst with JPMorgan said in a report ahead of the earnings release. China's telecom operators are expected to spend around 350 billion yuan ($53 billion) in 2012 on upgrading and expanding their 3G technology, up 9 percent from last year and outpacing the industry average of around 5 percent, analysts said. That will benefit ZTE, which together with Huawei own half the core infrastructure telecom equipment market in China, analysts said. Since the beginning of this year, ZTE's shares were up/down xxx percent , out/underperforming the main Hang Seng Index's xxx percent gain/loss . Link this Share this Digg this Email Reprints

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