Tianfeng Securities·2025-09-17 09:14Investment Rating - The report maintains a "Buy" rating for ZTE Corporation (000063) with a target price not specified [6]. Core Views - ZTE Corporation's revenue for the first half of 2025 reached 71.55 billion yuan, representing a year-on-year growth of 14.5%, while the net profit attributable to shareholders decreased by 11.77% to 5.06 billion yuan [1]. - In Q2 2025, the company achieved a revenue of 38.59 billion yuan, a significant year-on-year increase of 20.92%, with notable growth in the government and enterprise business segment, which saw a 109.93% increase [2]. - The company's strategy of "Connection + Computing Power" is yielding results, with revenue from computing power and terminal products nearly doubling year-on-year, accounting for over 35% of total revenue [3][5]. Summary by Sections Financial Performance - For the first half of 2025, ZTE's revenue was 71.55 billion yuan, with a net profit of 5.06 billion yuan, reflecting a decline in profitability [1]. - The second quarter of 2025 showed a revenue of 38.59 billion yuan, with a net profit of 2.60 billion yuan, indicating a decline of 12.94% year-on-year [2]. - The company anticipates a net profit of 8.5 billion yuan for 2025, with projected earnings per share (EPS) of 1.77 yuan [6]. Business Segments - The revenue breakdown for Q2 2025 includes 35.06 billion yuan from carrier networks (down 5.99% year-on-year), 19.25 billion yuan from government and enterprise (up 109.93%), and 17.23 billion yuan from consumer business (up 7.59%) [2]. - The computing power segment, including servers and storage, saw over 200% growth, with AI servers making up 55% of this revenue [3]. Strategic Initiatives - ZTE is enhancing its core switching chip capabilities, aiming to upgrade from 12.8T to 51.2T forwarding capacity [4]. - The company is actively expanding its AI-driven solutions, including self-developed chips and integrated computing products, to support the growth of intelligent computing centers and consumer applications [5]. - ZTE's "AI Together" initiative aims to enhance collaboration among AI models, with new product launches such as the Nubia Z70S Ultra and Nubia Flip 2 [5].