China Unicom Profit Falls 9.2%
Source: OWEN FLETCHER And CHESTER YUNG
BEIJING―China Unicom (Hong Kong) Ltd. reported a 9.2% drop in first-half earnings, though Apple Inc.'s iPhone helped fuel growth in mobile services.
China Unicom―China's only carrier officially offering the iPhone―is racing China Telecom Corp. and China Mobile Ltd. to boost revenue by adding users of third-generation mobile services, which offer faster data speeds at a higher price than second-generation services.
Tough competition and heavy spending on subsidies for 3G handsets like the iPhone weighed on China Unicom's earnings last year, though analysts said the subsidies could help accelerate growth this year.
The iPhone wasn't Unicom's key revenue driver but did give a "positive boost," China Unicom President Lu Yimin said at a news conference Wednesday.
Apple also sells the iPad in China, though Unicom doesn't offer the tablet. "I understand Apple has been working hard to launch the iPad. Once the mainland regulator gives the green light, we would be happy to cooperate with Apple," Unicom Chief Executive Chang Xiaobing said. An Apple spokeswoman declined to comment.
China Unicom posted first-half net profit of 2.65 billion yuan ($414 million), down from a restated 2.92 billion yuan a year earlier. Analysts polled by Dow Jones Newswires had forecast a profit of 1.28 billion yuan for the latest half.
Revenue rose 23% to 101.4 billion yuan from a restated 82.64 billion yuan. Analysts had forecast 98.87 billion yuan. Mobile-service revenue climbed 25% to 48.97 billion.
Unicom restated last year's figures because of an accounting change.
China Unicom's monthly average revenue per user for mobile services―a barometer of long-term growth―rose 9.3% to 46.8 yuan as 3G subscriptions increased. China Unicom added 9.9 million 3G users in the half. The company expects to add 25 million 3G users this year.
China Unicom declared no first-half dividend, the same as last year.
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