Among the major communication manufacturers in the mainland, the most often compared with Huawei is ZTE. Just as OPPO and vivo often appear as comparison items, ZTE has always compared it with Huawei.
Although compared with Huawei's wolf culture, ZTE's corporate culture is more peaceful and steady, and the pace of progress is as steady as a cow. But not only were the two companies established for about the same time, but even the "encounters" in development were similar – they were sanctioned by the United States.
In addition, ZTE and Huawei also have a common point, that is, the founders are middle-aged and started their own businesses from scratch, but they have established their own communication empires with their personal ability. Coincidentally, Ren Zhengfei started a business at the age of 43, and Hou Weigui, the founder of ZTE, also started his business from scratch at the age of 43.
Born in 1941, Hou Weigui studied well from an early age, and with excellent results, he was soon admitted to Nanchang University. After graduation, Hou Weigui did not continue to stay in Nanchang, but returned to Xi'an and chose to be a secondary school teacher.
Later, the school where he taught was abolished and replaced by a factory set up by the Ministry of Aerospace, and Hou Weigui became a technician in the factory. Hou Weigui, who was willing to endure hardships, soon rose from a skilled worker in the factory to a workshop director and a technical section chief. In the 1980s, Hou Weigui's factory was designated to study semiconductor technology, and as the head of the technical section, Hou Weigui was sent to the United States to study technology. This trip to the United States allowed Hou Weigui to accumulate a considerable amount of semiconductor knowledge.
In 1984, at the age of 43, Hou Went south and founded ZTE Semiconductor. Semiconductors is a rather cash-burning industry, and the technical requirements are also very high. In order to obtain a source of funds, ZTE Semiconductor has started the FOUNDG business of electronic watches, dialogue machines, radios and other machines, and this simple assembly technology content is not high, and it can only earn about 350,000 yuan a year.
When doing telephone processing business, Hou Weigui noticed that the mainland's communications industry is very backward compared with developed countries, and telephones are not popular. So Hou Weigui led the team to start research and development, in 1990, ZTE released the first digital user switch in mainland China - ZX500, since then ZTE opened the road to communication. In 1992, ZTE's revenue reached 100 million.
In 2000, PHS entered the Chinese market. At that time, many manufacturers were not optimistic about PHS, but ZTE "bet" on PHS and made sufficient preparations for the outbreak of PHS.
Sure enough, at the end of 2002, the demand for PHS exploded, and ZTE's three mobile phones at that time sold 4.5 million units a year. ZTE has therefore successfully transformed into a three major communication field of data, guangtong and mobile.
In 2004, ZTE successfully listed on the Hong Kong stock market, at that time ZTE opened up foreign markets. The following year, ZTE's share of overseas revenue rose to 35 percent. After that, ZTE went to the position of the world's fourth largest communication equipment manufacturer, the top three being Huawei, Nokia, and Ericsson.
As a communications company, for more than 30 years, Huawei and ZTE have been in a competitive relationship, but Ren Zhengfei and Hou Weigui are very appreciative of each other, and will sit together to talk about technology research and development, Hou Weigui is also an opponent that Ren Zhengfei admires.
Hou Weigui, who was already in his 70s at the time, saw that the ZTE Empire he had founded was moving steadily, so steady that he could not keep up with the rapid development of the times, so he decided to retire and let more creative young people do it.
But who knows, just two years after retirement, in April 2018, the US Department of Commerce imposed a comprehensive ban on ZTE, and completely banned US companies from exporting parts to ZTE for 7 years.
ZTE was sanctioned by the United States earlier than Huawei, and there was no time to prepare, this fierce move caught ZTE off guard, and the business almost stopped. Hou Weigui had to go out of the mountains, and then ZTE signed relevant agreements with the United States to resume normal operations.
Now, 4 years have passed, ZTE's communication business has basically recovered, and now it has 55 5G orders. According to ZTE's 2021 third quarter financial report, ZTE's revenue in the three quarters was 83.825 billion yuan and net profit was 6.190 billion yuan, which has surpassed the annual net profit of the previous two years.
The 2021 performance forecast released by ZTE shows that the annual net profit may reach between 6.5 billion and 7.2 billion, an increase of about 60% year-on-year, and the deduction of non-net profit also exceeds 3 billion yuan, which shows that ZTE has fully returned to the track of endogenous growth.
According to the research report of Shengang Securities, with the domestic and international markets and operator networks, government and enterprises, consumers and the three major businesses fully recovered, ZTE's revenue is estimated to be 114.1 billion yuan in 2021, and will exceed 150 billion yuan in 2023, as of February 18, ZTE's total market value has risen to 139.1 billion yuan.
After being sanctioned, ZTE became more aware of the importance of independent technology, and then also focused more on technology research and development. In the first three quarters of 2021, ZTE's R&D investment was 14.171 billion yuan, and in the 2021 PCT International Patent Ranking, ZTE ranked 13th in the world with 1493 patents.
Recently, relevant media reported that ZTE is cooperating with TSMC to manufacture the main control chip of 5G base stations through TSMC's 7nm chip production technology. At present, ZTE occupies 10.9% of the global 5G communication equipment, ranking fourth in the world, according to the current development trend of ZTE, the future is likely to enter the top three.
On February 15, ZTE held the first strategic communication meeting in 2022, at which the senior vice president of ZTE said that from this year, ZTE officially entered a period of strategic transcendence, and it is necessary to restore terminal business and move closer to mainstream manufacturers. Nowadays, various communication manufacturers are moving forward at a rapid pace, and ZTE must do enough work in technology and innovation to make enterprises go further.