Profit Drops For China’s Three Top Telecom Operators

China Mobile, China Unicom and China Telecom published their performance for the first quarter of 2015 and all of them reported a net profit decline during the period.

China Mobile said that the company's operating revenue in the first quarter of 2015 was CNY160.9 billion, a year-on-year increase of 3.9%; while its net profit was CNY23.83 billion, a year-on-year decrease of 5.6%. China Mobile's net profit reportedly declined for seven consecutive quarters. China Unicom's operating revenue during the reporting period was CNY60.25 billion, a year-on-year decrease of 5.6%; and its net profit was CNY3.16 billion, a year-on-year decrease of 4.2%. China Telecom's operating revenue was CNY81.453 billion, a year-on-year decrease of 2.1%; and its net profit was CNY5.046 billion, a year-on-year decrease of 9%.

According to China Telecom, its revenue and profit were impacted by the trial of replacing business tax with value-added tax in China. In addition, the company's other measures such as optimizing development, maintaining its marketing model and enhancing marketing expense control also affected its performance. China Unicom also said that its profit decline was attributed to the trial of replacing business tax with value-added tax.

For user development, the three major Chinese carriers faced different situations. Based on its 4G business advantage, China Mobile gained 4.602 million new mobile users in March, reaching a total of 815 million users. During the first quarter of 2015, the company added over 53 million new 4G users, and the total number of its 4G users reached 143 million. Meanwhile, China Telecom gained 1.25 million new mobile users in March to a total of 189 million users; and it gained 9.67 million new 4G users in the first quarter of 2015 to a total of 16.75 million 4G users.

Compared with its two competitors, China Unicom was unlucky. The company's number of mobile users decreased by 1.609 million in March to a total of 295 million.