Apr 24, 2020 08:32 PM

Profits Fall For China’s Big Three Telecoms

China’s top three mobile carriers have all promised to invest heavily in 5G this year.
China’s top three mobile carriers have all promised to invest heavily in 5G this year.

China’s three largest state-owned telecom operators all reported sluggish earnings in the first quarter, as the novel coronavirus pandemic shut down the country’s economy and hurt customer acquisition.

China Unicom led the trio’s decline, with net profits dropping 13.9% for the three-month period that ended on March 31, followed by China Telecom’s fall of 2.2% and China Mobile’s 0.8% decline, according to earnings reports released over the past week. During the period, China Unicom made profits of 3.17 billion yuan ($448 million), while China Telecom profited 5.8 billion yuan and China Mobile made 23.5 billion yuan.

“So far this year, the novel coronavirus outbreak has posed challenges to the Group, especially in terms of business development, customer acquisition” said Hong Kong-listed China Unicom in its earnings report, echoing its two rivals.

Two of the three mobile carriers saw their user bases shrink in the first quarter as the coronavirus pandemic prompted millions to cancel services. China Unicom was hit the hardest, losing 7.5 million customers, while China Mobile saw subscriptions fall by 3.98 million. China telecom added a modest 980,000 new users.

China’s telecom industry recorded a 2.3% decline in total revenue to 377.8 billion yuan in the first quarter amid the Covid-19 pandemic, the country’s Ministry of Industry and Information Technology said earlier this month. China Mobile, the largest among the trio, reported revenue of 181.3 billion yuan for the quarter. Its revenue saw a year-on-year drop of 2%, compared to a 1.4% decline for China Telecom and modest 0.9% growth for China Unicom.

Still, mobile carriers’ user acquisition struggles have been partly offset by relatively better performance in other areas like fixed-line broadband service, as the coronavirus forced people stay at home, spurring demand for home internet. China Mobile and China Unicom saw its broadband service users increase by 4.1 million and 1.35 million respectively.

Mobile carriers have also been able to generate new business with rollout of 5G data service. For the quarter, China Mobile added more than 29 million 5G users, bringing its total to 31.72 million. China Telecom added 12 million, for a total of 16.61 million 5G users as of end of March. China Unicom did not publish the size of its 5G user base, but has said it would aim to have 50 million by the end of this year.

Including 5G users, China Mobile had the largest total user base with 946 million accounts as of end of March, about three times that of China Unicom and China Telecom respectively.

All three have said they will continue to double down on 5G in 2020. China Unicom plans to increase capital expenditure by 24% to 70 billion yuan this year, with half earmarked for 5G, the company said earlier this month.

China Telecom has said its 5G capital expenditure for 2020 will be 45.3 billion yuan, while China Mobile had said it could spend as much as 100 billion yuan on the technology in 2020.

Contact reporter Mo Yelin ( and editor Gavin Cross (

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