ZTE's net profit last year declined by over 30%, planning to use no more than 40 billion yuan of its own funds for financial management

On March 6th, ZTE Corporation (ZTE, 000063.SZ; 00763.HK) released its 2025 annual performance report. The financial report shows that the company achieved operating revenue of 133.895 billion yuan in 2025, a year-on-year increase of 10.38%; net profit attributable to the parent company was 5.618 billion yuan, a decrease of 33.52% year-on-year; net profit after deducting non-recurring gains and losses attributable to the parent was 3.37 billion yuan, with basic earnings per share of 1.17 yuan. In the fourth quarter of 2025, operating revenue was 33.376 billion yuan, a year-on-year increase of 6.79%; net profit attributable to the owners of the parent was 296 million yuan, down 42.95% year-on-year.

ZTE stated that in 2025, facing the challenges and opportunities brought by the rapid development of artificial intelligence, the group坚持创新引领, “connectivity + computing power” strategy upgrade has begun to show results, and operating revenue has returned to growth track; meanwhile, against the backdrop of industry cycle shifts and business structure adjustments, net profit attributable to the parent was under pressure.

During the reporting period, the company’s computing power business achieved leapfrog growth, with annual revenue increasing approximately 150% year-on-year, accounting for 24.6% of total revenue. Server and storage revenue grew by over 200% year-on-year, and data center product revenue increased by 50%. The home and personal terminal business continued to grow, contributing a total revenue of 25.3%. At the same time, under the dual influence of industry cycle shifts and changes in business structure, the company’s gross profit margin faced temporary pressure. The company坚持高强度研发投入, with R&D expenses reaching 22.76 billion yuan for the year, accounting for about 17.0% of revenue, continuously building an AI end-to-end capability matrix to lay a solid foundation for long-term competitiveness.

Specifically, among the three major business segments, in 2025, ZTE’s carrier network revenue was 62.857 billion yuan, accounting for 46.9% of total revenue, a decrease of 10.62% year-on-year, mainly due to declines in wireless access and fixed network product revenues; gross profit margin was 48.09%, down 2.81 percentage points year-on-year, mainly due to the decline in wireless access product gross profit margin.

In the government and enterprise sector, ZTE’s revenue in 2025 was 37.222 billion yuan, a year-on-year increase of 100.49%, mainly driven by growth in server and storage revenue; gross profit margin was 10.97%, down 4.36 percentage points year-on-year, mainly due to changes in revenue structure. In the government and enterprise market, the company focuses on a “technology + scenario” dual-driven approach, seizing opportunities from intelligent computing investments, leading to a leapfrog increase in revenue and becoming a new engine for the company’s growth.

In the consumer business, ZTE’s revenue in 2025 was 33.816 billion yuan, a year-on-year increase of 4.35%, mainly due to growth in smartphones, mobile internet products, and cloud computers; gross profit margin was 18.31%, down 4.35 percentage points year-on-year, mainly due to a decline in household terminal gross profit margins.

ZTE stated that in 2025, the company fully embraced artificial intelligence, focusing on the four major areas of “network, computing power, home, and personal,” consolidating the network fundamentals, using computing power as a growth engine, and promoting breakthroughs in home and personal terminals, building a long-term competitiveness driven by “connectivity + computing power.”

The company also announced its 2025 profit distribution plan, proposing to distribute 4.11 yuan in cash (including tax) for every 10 shares to all shareholders.

On the same day, the company announced that the board of directors approved the “Proposal for the Use of Self-owned Funds for Entrusted Wealth Management in 2026,” under the premise of ensuring daily operating capital needs and effectively controlling risks, agreeing that the company and its subsidiaries may use self-owned funds for entrusted wealth management, with a limit of no more than 40 billion yuan. This matter still requires approval from the shareholders’ meeting.

(Source: The Paper)