TCL Brand Smartphone Revenue Increased by More Than 200% Year-on-year in September

On the basis of contrarian growth in the first half of the year, the company's global smart TV and Internet business in the third quarter of 2020 achieved another good performance, with an operating revenue of HK $14.68 billion, a year-on-year increase of 76.6% and a month on month increase of 43.9%; Gross profit reached HK $2.82 billion, a year-on-year increase of 55.7% and a month on month increase of 32.1%; The expense rate decreased by 2.2 percentage points year-on-year to 16.2%; The net profit attributable to the parent company after deduction of non profits was HK $360 million.

In the first three quarters of 2020, the company achieved an operating revenue of HK $31.83 billion, a year-on-year increase of 22.0%; The company's gross profit reached HK $6.35 billion, a year-on-year increase of 21.9%; The expense rate decreased by 0.4 percentage points year-on-year to 15.8%; The net profit attributable to the parent company after deducting non profits reached HK $810 million, a year-on-year increase of 56.6%.

The company's Internet business continued to grow steadily, with a year-on-year increase of 62.1% to HK $260 million in the third quarter. Revenue doubled in the first three quarters, with a year-on-year increase of 100.4% to HK $780 million; Operating profit increased by 169.7% year-on-year to HK $330 million.

Smart TV and Internet services go hand in hand and blossom at multiple points

With the global economic recovery in the third quarter, TCL electronics adhered to the user-centered concept, accelerated product technology innovation and supply and demand response speed, continued to optimize product structure and channels, continued the performance growth trend in the first half of the year in the third quarter, and made further breakthroughs in its main businesses such as smart TV business and Internet business.

TV sales remain among the top three in the world and actively adjust market strategy in line with the epidemic situation

Through the continuous deepening of the strategic layout of globalization, the influence of TCL electronic brand has been continuously improved, and the brand TV business has been further recognized by global consumers. In the third quarter of 2020, the sales volume of TCL brand TV sets reached 7.24 million, a year-on-year increase of 49.7% and a month on month increase of 24.7%; According to the latest report of Qunzhi consulting, the market share of TCL brand TV sales in the third quarter of 2020 increased by 2.7 percentage points to 11.3% from 8.6% in the same period last year, ranking among the top three in the world. The cumulative sales volume in the first three quarters reached 17.32 million units, a year-on-year increase of 14.4%.

Thanks to the company's brand strength, product strength and global supply chain advantages, TCL brand TV has steadily increased its market share in many countries around the world. According to the latest report of GfK, in the first three quarters of 2020, the market share of the company's overseas sales increased by 1.0 percentage points year-on-year, the TV sales ranked among the top five in 19 key countries and the market share ranked among more than 15 key countries year-on-year. At the same time, the company continues to lead the trend of large screen, high-tech and Internet of smart TV all over the world. In the third quarter of 2020, TCL's overall average TV sales increased by 0.5 inches to 45.5 inches from 45.0 inches in the same period last year; The sales volume of 65 inch and above super large screen TVs increased by 62.3% year-on-year; The proportion of 4K TV sales increased by 4.1 percentage points to 54.8% from 50.7% in the same period last year, and the proportion of smart TV sales increased by 10.3 percentage points to 91.4% from 81.1% in the same period last year; The proportion of quantum dot TV sales in overseas markets increased by 4.5 percentage points year-on-year to 4.8%.

In the first three quarters of 2020, TCL brand TV business still achieved contrarian growth under the complex and changeable international environment, and the sales volume in overseas markets increased by 26.8% year-on-year to 12.83 million units; Among them, the North American market increased by 24.8%, the emerging market increased by 15.5% and the European market increased by 96.3%. Revenue increased by 19.7% year-on-year to HK $18.81 billion; Gross profit reached HK $3.26 billion, a year-on-year increase of 34.6%; The gross profit margin increased by 1.9 percentage points year-on-year to 17.3%. In the third quarter, the sales volume in overseas markets was brilliant, with a year-on-year increase of 81.3% to 5.52 million units; Revenue reached HK $8.48 billion, a year-on-year increase of 71.5%; Through the optimization of product and channel structure, the gross profit margin was 17.3%, a year-on-year increase of 1.3 percentage points; The operating profit margin increased by 1.6 percentage points year-on-year.

In the Chinese market, TCL electronics still performs well. According to the omni-channel data of zhongyikang, in the market environment in which the sales of Chinese TV sets fell by 8.9% year-on-year in the third quarter, the domestic market share of TCL brand TV sets bucked the trend and increased to 13.6%, ranking third. In order to comply with the new trend of consumption transformation under the epidemic situation, the company increased the sales of online channels, carried out new marketing modes such as live broadcasting and goods delivery, and made great efforts to improve the proportion of online channels. The overall sales volume in the first three quarters was 4.49 million units, of which the online sales increased by 9.9% to 2.12 million units, accounting for an increase of 8.9 percentage points to 47.3% over the same period; Revenue was HK $7.78 billion. In the third quarter, TV sales increased by 7.2% month on month to 1.72 million units; Revenue increased by 20.9% year-on-year to HK $3.44 billion, a month on month increase of 38.5%.

Continue to deepen strategic ecological cooperation with international Internet giants, and the revenue of Internet business in the third quarter increased by 62.1% year-on-year

The company's Internet business achieved steady growth, with a year-on-year increase of 62.1% to HK $260 million in the third quarter; Revenue doubled in the first three quarters, with a year-on-year increase of 100.4% to HK $780 million.

Through cooperation with internet giants such as roku, Google and Netflix, TCL electronics continued to expand its global home Internet business. The revenue of overseas Internet business reached HK $81.44 million in the third quarter, a year-on-year increase of 32.3%. In the first three quarters, the cumulative revenue reached HK $210 million, a year-on-year increase of 30.3%; Operating profit increased by 166.0% year-on-year to HK $160 million. Moreover, in 2021, TCL electronics plans to work with roku to expand the UK and Brazil markets and further explore overseas markets. In addition, TCL electronics has actively promoted the content aggregation application TCL channel overseas, covering 12 countries by the third quarter of 2020. In the future, TCL channel will be launched in roku TV and Google TV of TCL brand in the United States to further promote Internet value-added services.

In the domestic market, the competitiveness of Thunderbird network technology products of the company has been continuously improved, which has continuously improved the user stickiness and member penetration of TCL electronics's Internet business. In the third quarter, the domestic Internet business revenue increased by 80.9% year-on-year to HK $180 million. In the first three quarters, the cumulative revenue of domestic Internet business reached HK $570 million, a year-on-year increase of 148.4%; Operating profit increased by 173.1% year-on-year to HK $180 million; ARPU reached HK $33.8, a year-on-year increase of 36.5%. By the end of September 2020, with the continuous access of domestic IOT smart TV equipment, the average number of monthly active users of Thunderbird platform had increased by 21.3% to 17.4 million year-on-year, and the average daily startup time of users was up to 5.84 hours, an increase of 9.6% year-on-year.

The revenue of TCL brand smart phones increased by more than 200% year-on-year in September, and 5g mobile phones were sold in Verizon, the largest operator in the United States

In September 2020, TCL COMMUNICATION merged tables for the first time. Among them, the revenue of mobile phone and service business in September reached HK $900 million, a year-on-year increase of 8.0%; Among them, the revenue of TCL brand smartphone increased by 215.5% year-on-year. Other consumer electronic products also showed good performance, among which the revenue of smart tablet business reached HK $150 million, a year-on-year increase of 25.4%; The revenue of routers and other intelligent connection products reached HK $120 million, a year-on-year increase of 115.5%. At the same time, overseas advantages have gradually become prominent. As of the third quarter of 2020, mobile phone sales ranked fifth in the U.S. market, sixth in Australia and Europe, and seventh in Latin America. The sales volume of smart tablets ranks 4th in the U.S. market, 5th in the European market and 7th in the Latin American market (data source: latest report of IDC). In October this year, TCL 105g UW mobile phone was officially launched in Verizon, the largest operator in the United States.

Continuously increase scientific research investment and firmly promote the development of AI x IOT core strategy

In order to continuously promote the company's core strategic development with smart display as the core and 5g and AI x IOT as the technology driver, TCL electronics increased its R & D investment. In the third quarter, the R & D expenditure reached HK $390 million, a year-on-year increase of 61.2%; The first three quarters totaled HK $900 million, a year-on-year increase of 51.2%; The R & D expense rate increased by 0.5 percentage points year-on-year to 2.8%. The company is the first enterprise in the world to mass produce Mini LED TV. It has taken the lead in listing 8K Mini led x 10 smart TV in China and TCL 6 series and 8 Series Mini LED TV in the U.S. market. Meanwhile, the first 5g 8K qled smart screen TV was launched in the Chinese market in August this year. In the future, the company will continue to increase R & D investment and focus on technology R & D and product innovation applications such as AI, IOT and cloud services, intelligent interaction, Android TV system and Internet applications.

While the R & D investment continued to increase, TCL's R & D of electronic products gained a lot in the third quarter. TCL qled TV c815 series won the EISA Gold Award, the highest award in the European audio-visual industry, and was rated as "the best TV in 2020-2021". In addition, TCL qled TV 8K x9 made its debut at ifa2020. It is the world's first consumer grade 8K TV, which has been unanimously recognized at home and abroad. The company's brand strength and influence have been further expanded. According to the Research Report on China's top 100 brand values in the 26th Ruifu global ranking in 2020, TCL's brand value ranks eighth and the national TV industry ranks first.