China Mobile Adds 65M 4G Customers
China Mobile added 65 million customers to its seemingly unstoppable 4G business in the first three months of the year, the operator has revealed.
China Mobile, the largest of China's big three mobile operators, has been able to extend an already impressive 4G lead over smaller rivals China Unicom and China Telecom despite the best efforts of those players.
Its 4G business served a total of 377 million customers at the end of March, representing about 45% of the overall mobile customer base.
Both China Unicom Ltd. (NYSE: CHU) and China Telecom Corp. Ltd. (NYSE: CHA) have yet to report first-quarter figures, but the former served about 54.8 million 4G customers at the end of February, having signed up 10.6 million in the first two months of the year.
China Telecom has also added 10.6 million so far this year to finish February with 69.1 million 4G customers in total.
While much of China Mobile Ltd. (NYSE: CHL)'s 4G growth has been fueled by existing customers upgrading to higher-speed offerings, the operator added 7.6 million new mobile subscribers in the first quarter to give it 834 million overall.
Earlier customer gains appeared to come at the expense of China Unicom, but the smaller player yesterday claimed its own mobile business grew by 6.61 million customers in the first three months of 2016.
Even so, China Unicom has warned investors to expect a nosedive in first-quarter profits (attributable to equity shareholders), saying these are likely to have fallen by as much as 85%, to 480 million Chinese yuan ($74.2 million), compared with the year-earlier period. (See China Unicom Warns of 85% Fall in Profit .)
China Mobile's headline financials stand in sharp contrast, with first-quarter profits attributable to equity shareholders rising by 0.5%, to RMB23.9 billion ($3.7 billion), and operating revenues growing by 8.7%, to RMB177.5 billion ($27.4 billion).
Despite concerns about a slowdown in the Chinese economy, customer spending has risen with the rollout of new mobile data offerings: Average monthly revenue per user was up to RMB57.6 ($8.90) in the quarter, from RMB48.2 ($7.45) in the October-to-December period.
Commenting on its strong quarterly performance in a statement, China Mobile said it was no longer being hurt by tax changes that were introduced last year.
"As a result of … the favorable effects of stimulated customer spending in this quarter by tariff promotion and sales initiatives towards the end of last year, [the] revenue growth rate picked up again compared to that for … 2015," said the company.
China Mobile also flagged growth in its much smaller fixed-line business, indicating that wireline broadband subscriber numbers had risen to 60.59 million in the quarter, from 55.03 million a year earlier.
The operator's share price closed 0.89% down on the Hong Kong stock exchange today, following reports that Chinese authorities are set to issue a "general telecom license" to cable operator Chinese TV Broadcasting Network Company.
— Iain Morris, , News Editor, Light Reading