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Chinese ZTE focuses on chip design, doesn’t have manufacturing capabilities

Chinese telecom equipment makers such as Huawei and ZTE hope to dominate the global market for 5G mobile networks. © AP. Sketched by the Pan Pacific Agency.

BEIJING, Jun 21, 2020, Global Times. Chinese telecoms equipment giant ZTE Corp stated on Saturday (Jun 20) that in the chipset sector the company is only focusing on communications chip design and does not have chip manufacturing capabilities, Global Times reported.

The statement came following some media reports claiming that the Shenzhen-based firm has begun mass production of 7nm chips, “which is not true and has caused some disruption to the firm’s normal operations.”

The company has more than 20 years’ experience in the design of communication chips, and has the ability to customize the entire process from chip system architecture to back-end physical design, according to the ZTE statement.

In terms of chip manufacturing, the company relies on global partners, as the design and manufacture of chips requires full cooperation from the entire industrial chain, it said.

Xu Ziyang, president of ZTE, had stated the company’s chipset status during ZTE’s annual general meeting of shareholders on Friday in Shenzhen where the company revealed its plans for the smartphone chipset.

ZTE plans to launch 5nm chips in 2021 and its 7nm chips have already begun mass production, according to Xu.

The company, which was forced by the US to stop most of its business between April and July 2018 citing Iran sanction violations, has stepped up research and development in its technologies.

Its global patents had exceeded 36,000 by the end of last year, including 4,100 5G patents.

ZTE reported a 6.11 percent year-on-year growth of revenue in 2019, reaching over 90 billion ($12.7 billion) yuan. Net profits surged by 173.71 percent on a yearly basis, according to its annual earnings report.

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