Investors are none too happy with China Mobile and China Unicom after the two state-owned telecoms giants posted disheartening earnings reports late on Monday.
Despite adding 7 million customers in the third quarter, China Mobile, the country’s largest carrier, failed to meet analysts’ forecasts with operating revenue of 566.7 billion yuan ($80.1 billion) for the nine months through September, down 0.2% on the same period last year. The company’s profits also slumped 13.9% to 81.8 billion yuan.
It was a similar story over at Unicom, which saw revenues dip 0.7% to 198.5 billion yuan in the first nine months of the year. Although the company’s profit remained comparatively healthy at 9.8 billion yuan — a year-on-year increase of 11.9% — net profit fell below analysts’ forecasts.
Analysts took a somber tone, with one note from Daiwa Capital Markets describing the performances as “disappointing.”
Both companies cited well-worn themes for their travails, including intense competition and market uncertainty. China Unicom also blamed creeping market saturation, a declining 4G data bonus, and a national policy to increase mobile speed and reduce fees.
China Mobile’s Hong Kong stock slumped 1.36% to HK$65.45, and China Unicom fell 3.96% to HK$8.01, as of late in the Tuesday trading day.
Contact reporter Matthew Walsh (firstname.lastname@example.org)
Related: China Mobile CEO Li Yue Resigns