Business, Internet, Telecom & Wireless

Lower Rates For Faster Internet Still Pushes China Telecom's Revenue Up

China Telecom's operating revenue increased by 1.1% year-on-year to CNY246.317 billion while its net profit increased by 1.2% year-on-year to CNY16.407 billion, according to its latest financial report covering the first nine months of 2015.

China started replacing business tax with value-added tax in June 2014 and launched measures to improve Internet and mobile Internet speeds while lowering fees in May 2015, which impacted the company's revenue and profit. From January to September 2015, China Telecom's operating revenue was CNY246.317 billion, a mere increase of 1.1%; and its net profit was CNY16.407 billion, an increase of 1.2%. Of the total revenue, its service revenue was CNY221.067 billion, a year-on-year increase of 1.9%.

China Telecom enhanced its investment in network operations and established its competitive advantage in the collaborative development of wired and wireless broadband. Meanwhile, with the increase of operating lease expenses, China Telecom's network operation and supporting costs increased by 21.6% compared with the same period of last year. However, the group's sales and management expenses decreased by 21.6% year-on-year.

China Telecom's mobile user base reached about 194 million by the end of the third quarter of 2015, representing a net increase of 8.72 million users since the beginning of the year. Of that total, 3G and 4G users reached about 137 million, a net increase of 18.18 million. In particular, 4G users reached 43.73 million.

China Telecom said that its service revenue maintained steady growth during the first three quarters of 2015 and its monthly average revenue per user was CNY55.5, marking a slight increase over last year. At the same time, its fixed-line phone users decreased by 6.67 million; while its broadband users increased by 4.14 million to a total of 111 million.

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