{
  "id": 16699804,
  "title": "ZTE up 7% after AI pivot, computing surge drive fivefold increase in third quarter profit",
  "url": "https://urgent.news/2026/10/27/zte-up-7-after-ai-pivot-computing-surge-drive-fivefold-increase-in",
  "topic": "ai",
  "section": "AI",
  "published": "2026-10-27T03:17:11.000Z",
  "source": {
    "name": "South China Morning Post",
    "slug": "south-china-morning-post",
    "url": "https://www.scmp.com/tech/big-tech/article/3372231/zte-7-after-ai-pivot-computing-surge-drive-fivefold-increase-third-quarter-profit"
  },
  "original_language": "en",
  "account": "ZTE shares surged nearly 7% in Hong Kong after the company reported an astounding 395% increase in third-quarter net profit, reaching 1.31 billion yuan (US$196.3 million). Revenue also jumped 34% to 38.81 billion yuan. The company attributes this growth to expansion in its computing infrastructure and international operations, which countered a decline in domestic telecom spending.\n\nFor the first nine months, computing revenue surged over 70%, making up 38% of total sales. This surge was driven by AI focus, with computing-related revenue accounting for over 70% growth in servers and storage, and nearly 130% increase in data-center products. International revenue rose over 30% due to global opportunities in 5G, fiber upgrades, and AI infrastructure.\n\nHowever, gross margins remained tight due to industry cycles and changing product mixes. Despite the strong quarterly performance, net profit for the nine months dropped 23.7% year-over-year to 4.06 billion yuan, as revenue grew 16.2% to 116.84 billion yuan. Operating cash flow increased by 76% in the quarter, but fell nearly 60% for the nine months due to higher spending on goods and services.\n\nLooking ahead, ZTE plans to refine its product architecture to lower the cost per token by improving coordination between computing hardware and network systems. The company noted that AI competition is shifting from merely expanding computing capacity to enhancing efficiency throughout the token-processing chain.",
  "summary": "Shares in ZTE rose as much as 7 per cent in Hong Kong on Tuesday morning after the Chinese telecommunications equipment maker posted a nearly fivefold jump in third-quarter profit, driven by rapid expansion in its computing infrastructure and overseas operations. Net profit attributable to shareholders reached 1.31 billion yuan (US$196.3 million) for the three months ended September 30, up 395…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}