China TechFaith Wireless Communication Technology Ltd. (Nasdaq: CNTF) reported a profit for its fourth quarter after the close yesterday that beat the consensus on Wall Street, and guided for first-quarter revenues above the Street. 

The original developed product (ODP) provider focused on research and development of cell phones attributed its strong results to transitioning to an ODP provider model and progress on the development and production of middle to high end and tailor-made handsets.

“In our view, China TechFaith’s successful transition to an ODP model has become a key differentiating factor among Chinese companies on the handset value chain,” Susquehanna Financial analyst Adele Mao wrote in a research note this morning.

China TechFaith specifically noted that it launched 51 ODP models, including multimedia phones and dual mode dual card handsets consisting of multiple wireless technology combinations, as well as Windows-based smartphones and Pocket PC phones.

For the three months ended Dec. 31, 2007, the Bejing-based small cap recorded net income of $3.2 million, or $0.07 per American depository share, compared with a net loss of $6.7 million, or $0.15 per American depository share for the fourth quarter of 2006. The Thomson Financial mean estimate was for a net profit of $0.04 per share.

Net revenues for the quarter surged 56.7% to $45.7 million, from $29.1 million for the same quarter last year due to stronger-than-expected performance of the ODP business.

“The fourth quarter of 2007 was a clear indication that China TechFaith has emerged as a much stronger franchise poised for earnings growth in 2008 … with improved customer mix and a strong pipeline in the feature phone and Smartphone businesses,” wrote Mao.

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