China Mobile first half net profit rises 5.6% on 4G services boost
By Yimou Lee
HONG KONG (Reuters) – China’s largest telecom service provider, China Mobile Ltd, said its first-half net profit edged up 5.6%, its first interim profit rise in three years, as growth from lucrative 4G services helped it fend off stiff competition.
Beijing-based China Mobile said on Thursday net profit for the half rose to 60.6 billion yuan ($9.13 billion) from 57.3 billion yuan a year earlier. Revenue grew 7.1% to 370.4 billion yuan.
“China Mobile has focused its promotional efforts towards 4G upgrades and this campaign has successfully attracted a significant number of 2G/3G customers,” Chairman Shang Bing said in the filing.
China Mobile’s customers of the more lucrative 4G services more than doubled in the first half to 429 million from a year earlier, according to Reuters’ calculations based on data provided by the company.
Like smaller peers China Unicom Hong Kong Ltd and China Telecom Corp Ltd, China Mobile has faced a squeeze in recent years from internet-based messaging services like Tencent Holdings Ltd’s WeChat, which ate into carriers’ revenue from voice calls and short messages.
But analysts have said China Mobile enjoys first-mover advantage in money-spinning and fast-growing 4G services offering much faster data transmission speeds.
China’s 4G penetration ratio grew to 45% in June from 32% in December, Nomura analyst Leping Huang wrote in a research note before the earnings were published.
(Reporting by Yimou Lee; Editing by Kenneth Maxwell)