ZTE Corporation

000063.SZ

Communication Equipment · Technology

Price

¥35.67

+0.08 (+0.22%)

Market Cap

¥170.63B

Exchange

Shenzhen Stock Exchange

Winston Score

Winston is serious

Below-average fundamentals — multiple weak pillars.

Data as of Aug 13, 2026 · filings through Mar 31, 2026

Share count rising — dilution

+4.3% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 4.64B (2021) → 4.84B (2025)

ZTE Corporation is a Chinese company that makes equipment used to build phone networks and internet infrastructure. Its main products include 5G base stations, fiber-optic gear, smartphones, and networking hardware. ZTE sells to telecom carriers, governments, and businesses across China and many other countries, making it one of the largest telecommunications equipment makers in the world.

ZTE earns money by selling hardware, software, and related services to its customers. Most of its revenue comes from China, but it also operates in over 160 countries, competing directly with Huawei, Ericsson, and Nokia. ZTE's main competitive advantage is its deep ties to Chinese state-owned carriers and its large portfolio of 5G patents. However, the company faces serious risk from ongoing geopolitical tensions — it has previously been targeted by US export restrictions — and its thin operating margin of around 2.6% leaves little room for error if growth slows or new sanctions emerge.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+6.1% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

-47.1% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$19.9B/ year

↓ Declining (-17% vs prior year)

14.9% of revenue

In line with sector average (15%)

R&D spend declining — could signal cost-cutting or efficiency

Insider Activity

37.9%ownership

Insiders own a meaningful stake in the company

Cash Runway

~9 years

$88.2B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

$88.2B cash & investments at current burn rate

Growth context

ZTE Corporation is growing revenue at 6% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

Each metric is explained in plain language so you know exactly what you're looking at. Start your free trial now.

Quality

Gross Margin

28.3%

Modest — 28.3% gross margin

Operating Margin

3.4%

Thin — 3.4% operating margin

ROCE

0.7%

Weak — 0.7% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+9.9%

Steady sales growth (+9.9% YoY)

EPS YoY

-45.5%

Earnings shrinking (-45.5% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

1/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

41%

Weak — only 41% of profit becomes cash

FCF Margin

-1.5%

Burning cash (-1.5%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity

1.13

Elevated debt (1.13)

Interest Cover

1.08x

Dangerous — barely covers interest (1.1x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)

38.5x

Pricey — P/E 38.5

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+14.0

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (38.5 → 24.4)

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Dividends

Dividend Yield

1.15%

Small dividend — 1.15% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth

+122.2%

Dividend growing fast (122.2% YoY)

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