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Competition takes toll on China Mobile earnings

Competition takes toll on China Mobile earnings

China Mobile, the largest mobile player in the world by subscribers, reported less than impressive results for the first nine months of the year, with profit rising modestly but revenue down slightly.

The market leader’s net profit for the January to September period increased 3.1 per cent year-on-year to CNY95 billion ($13.7 billion), which included a one-off gain from the listing of China Tower.

Despite a 0.6 per cent rise in service turnover to CNY518 billion compared with the same period in 2017, total operating revenue dipped 0.3 per cent to CNY568 billion. Product sales dropped 9 per cent to CNY49.3 billion.

In the first six months of the year mobile service revenue edged up only 1.1 per cent to CNY268 billion. The company didn’t break out mobile sales for the nine-month period.

The operator said in a statement that “in the face of severe adversities” resulting from stiff market competition, a rapid decline in data value and a significant reduction in revenue after cancelling data “roaming” charges, it has “made prompt adjustments to its business strategy and actively responded to market competition”.

Its mobile subscriber base rose 4.3 per cent year-on-year to 916 million, with 4G users growing nearly 12 per cent to 695 million and accounting for 76 per cent of the total.

ARPU of CNY55.70 was down 4.1 per cent on end-June.

Average data traffic per user per month jumped 156 per cent year-on-year to 3.1GB.

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