The Shenzhen-based company has suffered as a slowing economy has hurt sales and margins have come under pressure. ZTE said its loss will be between 1.65 billion yuan and 1.75 billion yuan. That could be a fall of more than 260 percent compared with the same period last year. Basic earnings per share will be a loss of between 0.48 yuan and 0.51 yuan.

The company is due to report final results at the end of the month.

ZTE said its results during the period were hurt by the Iranian market. The United States is investigating the company over the sale of banned U.S. computer equipment to Iran, which could be used to monitor landline, mobile and Internet communications. ZTE said it is cooperating with U.S. authorities.

Iran is under global sanctions because of allegations it is trying to develop nuclear weapons - something the country denies.

ZTE's bigger Chinese rival, Huawei Technologies Co Ltd, is also under scrutiny by the United States. U.S. lawmakers have accused the company of being a potential security threat.

For the full ZTE Hong Kong Stock Exchange announcement, please see: here

($1 = 6.2672 Chinese yuan)

(Reporting by Claire Baldwin; Editing by Louise Heavens)

• A Permanent Economic Emergency