ZTE, a well-known Chinese telecom equipment provider, has allegedly started layoffs across departments, including wireless research institutes, terminals and other verticals. As per a report in China Star Market, many employees were informed about their layoffs before the end of February.
The report quoted a ZTE employee: “Some departments of the Wireless Research Institute are laying off 10-20 per cent of their staff. In addition, the terminal business department is also the focus of the layoffs.” The job cuts will also reportedly affect senior employees who have worked for the company for over 10 years.
Another employee said, “A software development engineer who has been in ZTE for more than 10 years is also on the list this time. The layoffs ratio in my department has exceeded 10 per cent, and more layoffs will continue later.”
As per the report, the company decided to lay off employees due to over-hiring last year. A ZTE spokesperson said that this is a “normal personnel adjustment and reshuffle” like every year and that there has been no noticeable change this year. ZTE reported an operating income of 92.559 billion yuan ($13.5 billion) in the first three quarters of last year, up 10.42 per cent year-on-year.
The net profit was 6.82 billion yuan, up 16.52 per cent year-on-year. On February 17, ZTE revealed the plan to diminish the holdings of the chairman of the board of supervisors.
ZTE Corporation is a partially state-owned technology Chinese company that specialises in telecommunication. It was founded in 1985 and is listed on the Hong Kong and Shenzhen Stock Exchanges.
ZTE’s core business is wireless, exchange, optical transmission, data telecommunications gear, telecommunications software, and mobile phones. ZTE primarily sells products under its name but is also an OEM.
The company has faced criticism in the United States, India, and Sweden over ties to the Chinese government that could enable mass surveillance. In 2017, ZTE was fined for illegally exporting U.S. technology to Iran and North Korea, violating the economic sanctions.
ZTE operates in three business segments: carrier networks, government and corporate business, and consumer business. ZTE products can be arranged into three categories: equipment used by network operators (links and nodes, etc.), equipment used to access networks (terminals), and services, which include software.
However, the recent economic slowdown and the possibility of a recession in the market will likely provoke companies to cut back on non-essential expenses, including marketing and social media management. The mass layoffs that started with tech firms, especially startups in 2022, have been spilling over to several others, including financial companies that slashed jobs in recent months.
