China's ZTE to sell 100 million smartphones a year by 2015

Mon Apr 23, 2012 4:56am EDT
 

By Lee Chyen Yee

HONG KONG (Reuters) - China's ZTE Corp, which launched its first basic mobile phone in Africa little more than 10 years ago, said it could be shipping 100 million smartphones a year by 2015, as it looks up-market to reverse a decline in its handset margins.

ZTE, which sold 15 million smartphones last year and could sell up to 50 million this year, also said it would launch its first two phone-cum-tablet 'phablets' this year, hoping to branch out from China's fiercely competitive mobile mass market.

ZTE, the world's No.4 handset producer and fifth-ranked telecoms gear maker, has fared better than crosstown rival Huawei Technologies Co Ltd in mobile sales, but lags its local peer in its mainstay telecom equipment business.

Both have diversified into consumer gadgets, selling dongles, smartphones and tablets to drive revenue growth as the telecom equipment sector stagnates, and both have met stubborn resistance in the United States where cyber-security issues have kept the telecom equipment market largely off-limits.

ZTE, valued at $9.3 billion, has expanded its footprint in emerging markets and Europe, though it said last month it was scaling back operations in Iran due to sanctions over Tehran's nuclear development program.

A total of 472 million smartphones were sold around the world last year, according to research firm Gartner, and Credit Suisse has forecast sales will top 1 billion by 2014.

ZTE plans to focus on its Blade and Skate handphone models, upgrading them rather than unveiling new models, and expects to also double its tablet PC sales this year, executive director He Shiyou said on Monday.

"As handsets contribute more to overall revenue, it will affect our profit margins. In 2012, our aim is to increase handset margins," He told reporters on the sidelines of the company's annual analyst conference in Shenzhen, where the company is based.   Continued...

 
Employees of ZTE chat on the roof of its headquarters in Shenzhen, Guangdong province, April 17, 2012. REUTERS/Tyrone Siu