ZTE has denied reports that it is planning to transfer its smartphone business into a new joint venture valued at approximately $5.6 billion. On November 3, the Chinese telecommunications company told several Chinese news outlets, including The Paper, that the reports were inaccurate and "seriously inconsistent with the facts." ZTE stated it reserves the right to take legal action over the publication and circulation of these claims. It provided similar denials to Yicai and National Business Daily.
The original reports claimed that ZTE was preparing to move its consumer smartphone operations into a jointly owned company involving three parties: ZTE, a major Chinese internet company, and Shanghai state-owned investors. The proposed business was reportedly valued at approximately $5.6 billion, with the unnamed internet company said to be considering an investment of around $1.1 billion. According to those reports, the final valuation, ownership percentages, and transaction structure had not been agreed upon.
The reports alleged that discussions began in April 2026 and gained momentum in July. The parties were reportedly close to agreeing on a cooperation model by September, with an announcement originally planned for late October. However, that announcement never took place. The proposal was said to cover ZTE’s consumer smartphone operations in China and international markets, rather than the sale of the entire company.
The original report also claimed that ZTE’s RedMagic gaming smartphone business would remain outside the proposed joint venture, meaning the transaction would primarily involve mainstream consumer smartphone operations. Meanwhile, router products and home terminal devices were reportedly expected to return to the parent company’s direct management. The proposed arrangement could have provided additional investment and operational support for ZTE’s smartphone business while allowing the parent company to focus on its other operations.
The report also pointed to an existing ZTE subsidiary as a possible vehicle for the proposed restructuring. In April 2025, ZTE established Shanghai Shenqi Jiyuan Intelligent Terminal Co., Ltd., which was wholly owned by ZTE according to the company’s 2025 interim report. Wang Xiyu was appointed chairman, while Ni Fei served as a director. The original report claimed that employees from ZTE’s smartphone operations had already been transferred to the subsidiary. However, the existence of the subsidiary does not establish that ZTE planned to sell or restructure its smartphone business through a new joint venture.
