China Mobile Revenue Rises as Pandemic Boosts Services Demand

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China Mobile Ltd.’s revenue rose in the first half as the coronavirus pandemic prompted industries to accelerate steps toward digitalization, boosting demand at the country’s biggest phone company.

Operating revenue gained 0.1% to 389.9 billion yuan ($56 billion) for the six months ended June, the state-owned company said in a statement Thursday. Net income fell 0.5% to 55.8 billion yuan.

Key Insights

  • China Mobile’s investment in building a 5G network is starting to pay off as customers upgrading to the high-speed service end up spending more.
  • The carrier is also adding more 5G users along with rivals China Telecom Corp. and China Unicom Hong Kong Ltd., which are sharing networks for the latest-generation service. China Unicom shares soared Thursday after the company reported profit that jumped 38% in the three months ended June to the highest in more than a decade.
  • The first-half profit decline extends an earnings slump for the carrier. China Mobile’s net income last year fell 9.5%, its biggest annual drop since 2014, after the government mandated price cuts.

Market Reaction

  • China Mobile’s shares rose as much as 5.9% Thursday in Hong Kong trading. The stock is down 8.5% this year, compared with an 11% drop for the benchmark Hang Seng Index.

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  • Net wireline broadband subscriber additions: 10.08 million
  • Total wireless subscribers: 947 million
  • Interim dividend: HK$1.53 a share

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