Shenzhen Transsion, 'king of mobile phones in Africa,' reports 210.3% rise in net profit

Tecno, Infinix and iTel, those are some of Africa’s bestselling phone brands and are all phones that are made in China.

But most people in China will not have heard of them. After all, they have never been sold in the country.

All three phone brands are manufactured by Shenzhen Transsion Holdings Co., which has  made its fortune by exclusively selling phones in Africa – before it expanded into other markets such as Latin America, India, Eastern Europe and Southeast Asia.

Widely known as the "king of mobile phones in Africa," Shenzhen Transsion was launched by Zhu Zhaojiang, a former sales manager at once-leading Chinese handset maker Bird Mobile, in 2013 in Shenzhen.

An employee works at Transsion's plant in Chongqing in this file photo. Xinhua

The firm, which lists shares on the tech-heavy STAR Market of the Shanghai Stock Exchange, said yesterday that revenue came in at 17.44 billion yuan (US$2.41 billion) in the first quarter of the year, an increase of 88.10% compared with the same period a year ago. Net profit jumped 210.3% from a year ago to 1.63 billion yuan and net profit after deducting non-recurring gains was 1.354 billion yuan, a year-on-year increase of 342.59%.

Shenzhen Transsion attributed its revenue growth mainly to its continuous exploration of emerging markets, product upgrades, and increase in shipments.

The increase in net profit was primarily a result of revenue growth, an increase in gross profit, and a decrease in expense ratios, the firm said in its quarterly financial report.

Shenzhen Transsion pulled in a revenue of 19.27 billion yuan in the fourth quarter of 2023, and its net profit and net profit excluding non-recurring items was 1.653 billion yuan and 1.625 billion yuan, respectively. This shows that the firm’s revenue dropped 9.49% and its net profit and net profit excluding non-recurring items slumped 1.6% and 16.68%, respectively, from a quarter ago in the first quarter.

A visitor interacts with an AI-enhanced robotic dog that Transsion's TECNO sub-brand unveiled at this year's MWC in this Feb. 26 photo. Xinhua

Shenzhen Transsion expects better performance this year than last year as sales in Africa and South Asia, the firm’s strongholds, have shown signs of recovery. Meanwhile, the firm is actively expanding into emerging markets such as Southeast Asia, the Middle East, and Latin America, which are poised to become a new source of profit growth beyond Africa and South Asia, according to its financial report.

A report released by market consultancy IDC on April 15 shows that Shenzhen Transsion shipped 28.50 units of smartphones in the first three months of the year, putting the Shenzhen-based vendor in fourth place globally with a market share of 9.9% after Samsung (60.10 million units with 20.8% market share), Apple (50.10 million units with 17.3% market share) and Xiaomi (40.80 million units with 14.1% market share).

Together, Tecno, Infinix and iTel accounted for 48% of the smartphone market in Africa in 2023. Tecno alone held 26% of the African smartphone market share while Infinix and iTel had 12% and 10% market shares, respectively.

Shenzhen Transsion set its sights on overseas markets from the very beginning. For more than a decade, it made its money by exclusively selling its mobile phones in Africa. Its success has been attributed to superior marketing and understanding consumer needs.

The firm has accurately captured the needs of African consumers by introducing phones with features to solve numerous issues faced by African telecom operators, such as making dual SIM card phones and camera phones better calibrated for darker skin tones.

A Transsion smartphone is seen on sale in Nairobi, Kenya, in this Nov. 8, 2023 photo. Xinhua

It has also developed a selfie algorithm specifically designed for the African market, using teeth and eyes for positioning and exposure adjustments to create a “chocolate skin tone” that African consumers love.

These thoughtful and considerate designs quickly won the hearts of African consumers. Ultimately, Shenzhen Transsion has firmly established itself as the "king of mobile phones in Africa."

In fact, the firm has made such a success of its sales strategy that in 2023 its Tecno brand sold more smartphones in the Middle East and Africa than Samsung or Apple.

According to data from Hong Kong-based firm Counterpoint Research, Tecno smartphone shipments grew by 77% year on year in the fourth quarter of last year, surpassing Samsung to lead the Middle East and Africa region for the first time.

According to Counterpoint, Tecno’s growth was driven by handsets in the US$150 price band, with models such as the Tecno Pop 7 and the Camon 20 Pro proving popular with consumers.