China Telecom’s 4Q Earnings Boosted Above Analysts’ Estimates Thanks To iPhone Usage

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China Telecom, the third-largest telecommunications company in that country, reported better-than-expected 4Q profit as customers using the iPhone helped boost sales of wireless data.

Net earnings fell 17 percent to 2.36 billion yuan ($380 million USD) from 2.84 billion yuan a year earlier, but outperformed the 2.04 billion yuan average estimated by analysts asked by Bloomberg. 4Q sales rose 17 percent to 73.1 billion yuan, from 62.6 billion yuan, in-line with the 73.2 billion yuan expected by analysts.

China Telecom started selling the iPhone in March as part of its campaign to grab more higher-end 3G users. Up until that point, the larger China Unicom had been the first and only carrier to offer Apple’s smartphone since October 2009 (China Mobile has yet to offer customers an iPhone contract).

China Telecom said when it first started carrying the iPhone that the device would increase long-term growth, but put “short-term pressure” on profitability. Indeed, since releasing the iPhone, China Telecom has reported three straight declines in quarterly profit. The company’s focus on expanding its 3G coverage means that its selling expenses, including handset subsidies, are higher than usual. Last August the company said that it was acquiring 3G network infrastructure from its parent, China Telecom Corp., for an initial $13.3 billion to cut future costs, and that the final value of the deal would be more than 117 billion yuan.