Chinese telecom giants Huawei and ZTE face market pressures amid US scrutiny

Finance


The Chinese company stopped trading April 17 after the U.S. banned American companies from selling components to ZTE for seven years. The decision was made in response to the company’s violation of U.S. sanctions against Iran and North Korea. ZTE pleaded guilty last year.

The company then delayed its first-quarter earnings report and board meeting, planned for April 19.

When it finally released results on Friday, ZTE said consolidated net profit attributable to ordinary shareholders surged 39 percent to 1.69 billion yuan.

But ZTE said the U.S. ban “has material adverse effects on the normal production and operation of the Company” and it is “unable to prepare the 2018 First Quarterly Report in accordance with the accounting standards for business enterprises.”

The shares remained halted and the stock is down 12.78 percent for the year. The company has a market capitalization of 153.8 billion Hong Kong dollars ($19.6 billion).

Both ZTE and Huawei have also become major smartphone manufacturers.

In 2017, Huawei ranked third in global smartphone shipments, behind Samsung and Apple, according to Strategy Analytics. Third-quarter data showed ZTE was the fourth-largest vendor in the U.S. by smartphone shipments.



Source link

Products You May Like

Articles You May Like

Best Buy shares drop after Bank of America downgrades
Major global markets already in bear market, stoking growth fears
FedEx CEO blames ‘bad political choices’ for most of company’s issues
Slower IT spending could reveal Cisco’s ‘imperfections,’ analyst says
JNJ oversold on asbestos fears; legal costs manageable, analyst says

Leave a Reply

Your email address will not be published. Required fields are marked *