Chinese operators are the latest to report a healthy bump in earnings and revenue.

China Mobile's third quarter net profit rose 11.7% to 28 billion yuan ($4.4 billion) on 10% higher revenue of 205 billion yuan, the company announced Wednesday.

Over the first three quarters it hiked net earnings 6.9% to 87.2 billion yuan and operating revenue 12.9% to 648.6 billion yuan.

Figure 1:

China Unicom, the smallest of the big three state-owned telcos, reported a 12% boost in Q3 income of 3.7 billion, with revenue up 7%.

Yet the Chinese numbers tell a different story from their Korean and US counterparts, who show signs of reaping the benefits of their 5G investments. If anything 5G appears to have depressed earnings in spite of, or perhaps because of, their enormous customer take-up.

It's in the numbers

That's especially true for China Mobile, which now claims 331 million "5G package" customers – that is, customers that have signed up for a 5G plan. Of these, just 160 million are using the new network with a 5G device. That's still an enormous number itself and includes the 33 million added in Q3 alone – more than South Korea's entire 5G customer base.

But while China Mobile might be sweating the LTE network by selling bigger data bundles to 4G users, it is carrying 171 million '5G' customers on the legacy network, which means it is missing out on the efficiency and capacity gains of 5G. That is especially concerning when mobile ARPU is down. Mobile's ARPU slipped 4.0% from Q2 to Q3 – not where you want to go when you're piling on 5G subs and when mobile data usage per handset has climbed by a third.

Broadband, China Mobile's other big consumer line of business, experienced a 3.6% ARPU decline in Q3.

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Rather than 5G, enterprise was the biggest source of growth for both China Mobile and China Unicom.

China Mobile's Q3 cloud and industrial internet revenue soared 46% to 49 billion yuan, or nearly a quarter of total revenue. The company said it had "seized the development opportunities" provided by accelerated digital transformation.

China Unicom's Q3 industry internet revenue increased 29% to 12 billion yuan – around 15% of its total sales.

Looking ahead, Unicom said it hoped to "fully unlock" the potential of digital transformation and its the mixed-ownership reform.

China Mobile's Hong Kong stock closed 0.41% higher in Thursday trading.

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— Robert Clark, contributing editor, special to Light Reading