not vested
ZTE’s global smartphone sales likely to slump more than half because of US export banPhone sales hammered even though company takes steps to get US ban lifted
by Li Tao
"Even if the US lifts the export ban immediately, the company has estimated that smartphone sales this year may not even reach 50 per cent of the number achieved in 2017,” said a person familiar with the situation who asked not to be named as the information is private.
ZTE’s fate is now at the mercy of a US political tug of war, after both Republican and Democrat senators voted by 85 to 10, to add language to a defence bill that would repeal President Donald Trump’s agreement to end the ban on US exports.
ZTE derived 59 per cent of its revenue last year from its carrier network business, which includes switching and access systems, optical and data communications and wireless communication systems.
Another 32 per cent of its revenue came from its consumer business, mostly from smartphone and tablet sales, and the remaining 9 per cent from government and corporate business, according to data compiled by Bloomberg.
“We can expect barely any sales from the second and third quarters even if the ban is lifted right away, as it will take months for ZTE to restore its operations and sales,” said Zaker Li, a senior industry analyst with IHS Markit.
Meanwhile, US lawmakers are also considering legislation that would bar government agencies from using ZTE and Huawei products, which some politicians have described as a potential security threat. The Pentagon this spring stopped the sale of Huawei devices on its military bases.
Unlike most Chinese smartphone brands which generate most of their sales from the domestic market, ZTE is largely dependent on overseas sales to the US and certain European markets.
ZTE is currently the fourth-largest smartphone vendor in the US
following Apple, Samsung and LG. In the fourth quarter of last year, ZTE accounted for
10 per cent of North American smartphone shipments, research agency Counterpoint said in a release.
ZTE’s smartphone shipments had already been under pressure before the US ban.
Shipments declined 17 per cent to 9.3 million in the first quarter of 2018 from 11.2 million during the same period in 2017, according to an earlier research report from IHS Markit.
In the US, the company has established relationships with carriers such as Metro PCS and Cricket Wireless. These relationships are now under threat and ZTE might not be able to restore them even if the ban is lifted, said the IHS Markit report.
Source: SCMP
http://www.scmp.com/tech/article/215230 ... export-ban
It's all about "how much you made when you were right" & "how little you lost when you were wrong"