ZTE Corp, one of the leading telecom equipment manufacturer, is confident that the company will turnaround its business this year and is predicting net profit of around 1.2 billion yuan ($178 million) and 1.8 billion yuan in the first half.

This is significant given that the company reported 7.8 billion yuan loss during the same six-month period in 2018. The latest development comes after the business continues to improve after a near-death experience last year.

Last year, in June, ZTE agreed to pay around $1 billion in fines to the US Department of Commerce and put up additional $400 million as surety as part of its settlement for violating US prohibitions against selling American equipment to Iran.

As a part of the same agreement, the company was also required to replace its board and terminate all executives ranked above senior vice-president, as well as anyone involved in the Iran violations.

When the company was banned from doing business in the US and with the companies based in the US, the company had to cease major operating activities for nearly four months. But, it decided to increase its focus in the R&D for 5G technology.

Coming to the finanacials, the company’s net profit was 863 million yuan for the three-month period ending March compared with a 5.4 billion yuan loss in the same period last year. ZTE‘s first-quarter revenue was 22.2 billion yuan, down 19.3 per cent from the first three months of last year.

The Research & Development costs for the first three months of this year amounted to 3.1 billion yuan, accounting for 13.9 percent of revenue, up compared to a ratio of 9.8 percent for the same period last year.

Read More: ZTE Axon V concept phone appears with 21:9 notch-less display and 3D dual selfie camera

Earlier this year, during Mobile World Congress in Barcelona, the company said that it had secured six commercial 5G contracts on top of its large supply deals with China Mobile, China Unicom and China Telecom.

(Via)

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ZTE went through very rough times last year because of the ban imposed on the company by the U.S. Commerce Department in April 2018. The ban nearly forced the company to shut down but three months later, it reached to deal by paying fines.

However, that ban put a significant toll on the company’s finances. For the year 2018, ZTE — one the leading telecom equipment manufacturer in the world, reported an annual loss of whopping 6.98 billion yuan, which roughly converts to $1.04 billion.

While the loss is within the company’s own estimate of loss ranging from 6.2 billion to 7.2 billion yuan, but it’s worse than the 6.2 billion yuan predicted loss by the analysis of investment firms. The company’s annual gross is reported to be 85.5 billion yuan in 2018, down 21.4% from 2017.

It’s noteworthy that the company did manage to get the things back to normal during the last quarter of 2018, i.e. from October to December during which the company posted a 276 million yuan net profit, which roughly converts to $41 million, with revenue amounting to 26.7 billion yuan.

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