China | China Mobile first half net profit rises 5.6% on 4G services boost
A sign of China Mobile is seen at CES (Consumer Electronics Show) Asia 2016 in Shanghai, China, May 12, 2016. REUTERS/Aly Song/File Photo
A sign of China Mobile is seen at CES (Consumer Electronics Show) Asia 2016 in Shanghai, China, May 12, 2016. REUTERS/Aly Song/File Photo

China Mobile first half net profit rises 5.6% on 4G services boost

August 11, 2016 1:18 AM (UTC+8)

 

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.

A sign of China Mobile is seen at CES (Consumer Electronics Show) Asia 2016 in Shanghai, China, May 12, 2016. REUTERS/Aly Song/File Photo
A sign of China Mobile is seen at CES (Consumer Electronics Show) Asia 2016 in Shanghai, China, May 12, 2016. REUTERS/Aly Song/File Photo

“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)

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