Key Takeaways From China Mobile’s Q1 Results

China Mobile (NYSE:CHL), the largest of the three Chinese wireless carriers, published its Q1 2018 results on Friday, April 20, reporting modest growth in its earnings, driven by slightly higher operating margins and an expanding subscriber base. Below, we take a look at some of the key takeaways from the carrier’s results. We have also created an interactive dashboard analysis on what’s driving China Mobile’s valuation.

China Mobile’s revenues grew by roughly 0.8% year-over-year to RMB 185.5 billion ($29.5 billion) under a new accounting standard (revenue would have risen 2.9% on a like-for-like comparison), driven by the company’s telecommunications services operations, which helped to more than offset declines in the company’s equipment sales. EBITDA margins improved by 1.1% year-over-year to 37.6%.

The carrier added a total of 11.34 million mobile subscribers over the quarter, compared to net additions of around 7.6 million in the year-ago quarter. The company’s ARPU also increased to levels of roughly RMB 55.7 driven by a larger base of 4G users and higher data consumption. The company’s 4G mix stood at 74.6% at the end of Q1, up from around 66.3% in the year-ago quarter, with monthly handset data traffic recording a 123% increase year-on-year.

China Mobile added a total of 11.23 million wireline broadband customers over the first quarter, up from around 8 million net additions in the year-ago period, driven by its move to increase access speeds and enrich content offerings for the residential market. The total number of wireline broadband customers reached 124 million.  However, ARPU for the wireline broadband business remained under pressure, at levels of around  RMB 33.8.

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