China Telecom's net profit falls 9.5pc despite 15.5pc rise in revenue
Increased sales to mobile users fail to boost bottom line as mainland operator sees iPhone marketing costs rise amid intense competition
China Telecom, the world's biggest fixed-line network operator and the nation's third-largest mobile-phone carrier, reported a 9.5 per cent decline in net profit last year due to increased marketing costs to promote the iPhone.
The wireline business still contributed the lion's share of 165.2 billion yuan in revenue, but the growth was only 1.8 per cent. Revenue from the mobile segment jumped 42.5 per cent to 117.8 billion yuan.
Operating expenses grew 18.5 per cent during the year to 261.9 billion yuan to increase marketing initiatives during its launch of the iPhone.
China Telecom launched Apple's wildly popular gadget in March last year during intensified competition with larger competitor China Mobile and China Unicom to attract high-end mobile service users.
China Telecom said the device would enhance long-term growth "despite the short-term pressure on profitability".
The company had 165.3 million subscribers at the end last month, of which 74.9 million were fast-speed 3G network users. It gained a net 2.8 million 3G users last month, less than market expectations.