Round-up: Telecom operators report Q3 results

Telecom operators have begun to release financial results for the third quarter of 2011.  In the United States, AT&T, Verizon Communications and Sprint all posted revenue in line with expectations, although both AT&T and Verizon saw weak smartphone sales.  In Europe, France Telecom was hurt by the weak European market, and has continued to move into the Middle East and Africa to offset its losses. In the Chinese market, telecom operators outperformed results from the year-ago quarter, but are experiencing a drop in ARPU due to giving out handset subsidies to attract 3G users.

AT&T

AT&T (Dallas, Texas, U.S.A.) posted a third quarter results in line with expectations.  The network operator reported Q3 revenue of $31.5 billion, down 0.3% from the year-ago quarter.  The lack of year-over-year growth was attributed to the timing of the new iPhone launch, which took place after the close of the third quarter.

Wireless, wireline data and managed services account for 75% of AT&T’s year-to-date consolidated revenue of $94.2 billion.  Wireline voice only accounts for 20% of consolidated revenue.

Of the 4.8 million smartphones AT&T sold in the third quarter, almost half of those were not iPhones.  AT&T’s subscribers reached 100.7 million in the third quarter, up from 92.7 million in the second quarter of 2011.

China Mobile

China Mobile posted a net profit of $4.81 billion, up from $4.6 billion in the year-ago quarter, although still below analysts’ predictions of $5 billion, according to Reuters.

China Mobile has 633.52 million mobile subscribers as of the beginning of the first quarter of 2011.  Of those subscribers, 43.16 million are 3G subscribers, up from 35.03 million the telecom operator had at this time last year.

China Mobile added 22.5 million 3G subscribers in the third quarter of this year.

Like its competitions, China Mobile is also experiencing a drop in ARPU do to 3G subsidized handsets.  The telecom operator posted a nine month average ARPU of $11, flat from the first half of the year.

China Telecom

China Telecom (Beijing, China) posted revenue of $653 million, up 9.7% from the year-ago quarter. Operating revenue was $9.7 billion in the third quarter, up 12% from the year-ago quarter.  

Like its competition, China Telecom has been spending money on subsidies for 3G handsets to attract new 3G customers. The telecom operator did not release ARPU.

China Telecom has 116.95 million mobile subscriber as of the beginning of the first quarter of 2011.  Of those, 28.43 million are 3G subscribers, up from the 9.15 million 3G subscribers the telecom operator had at this time last year.

In the third quarter the telecom operator added 8.58 million subscribers.  In the first three quarters of this year, China Telecom added 26.42 mobile subscribers, 16.14 million of which were 3G subscribers.

China Unicom

China Unicom (Beijing, China) reported a net profit of $253 million in the third quarter of 2011, up 21.2% from the year-ago quarter, but still missed analysts’ forecasts. 

The operator posted an ARPU of $7.4, up 9% from the year-ago quarter.  Although, the ARPU could still be under pressure due to giving out handset subsidies to attract 3G users, according to a Reuters report.

For the first nine months, Unicom posted a net profit of $670 million.  As of now, China Unicom is the only Chinese operator to offer the iPhone.

France Telecom

France Telecom (Paris, France) reported revenue of $15.5 billion in the third quarter of 2011, down from $16.47 billion in the second quarter of this year, and $15.6 billion in year-ago quarter.  The telecom operator posted a drop in revenue in France and Poland, while a slight increase was reported in Spain.  The 4.8% increase in revenue in Spain was due to strong growth in mobile phones, as well as fixed services, says France Telecom.

France Telecom reported a total wireless subscriber base of 162.1 million, an increase of 8.9% from a year-ago quarter.  Of those subscribers, 70.4 million are from Africa and the Middle East, according to the operator.

The operator posted an Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of $5.3 billion in the first quarter, down 5.2% from $5.7 billion in the second quarter of this year.

According to France Telecom, in light of its results in 2011 so far, the company has decided to increase its yearly operating cash flow target to a little more than $12.4 billion.

Sprint

Sprint (Overland Park, Kan., U.S.A.) posted third quarter revenue of 8.3 billion, up 2% from $8.15 billion in the third quarter of 2010. 

According to Sprint, the year-over-year improvement was due largely to higher postpaid average revenue per unit (ARPU) and growth in prepaid subscribers.  Sprint’s postpaid ARPU was $58, up from $57 in Q211 and from $55 in the year-ago quarter.

This quarter Sprint added 1.3 million new wireless subscribers, its best new subscriber rate since 2006. Sprint outperformed both AT&T and Verizon in new subscribers for this quarter, even without the iPhone, which it got after the close of the quarter.

Verizon

Verizon Communications (New York) posted third quarter results slightly ahead of expectations.  The network provider reported revenue of $27.9 billion, up from 26.4 billion in the year-ago quarter. 

Verizon Wireless posted service revenue of $15 billion in the third quarter, up 6% year-over-year.  Of that revenue, $6.1 billion was from data services, which was up 20.5%.

Verizon added 882,000 subscribers in the third quarter, more than doubling AT&T’s 319,000 subscribers, although Verizon fell below the average analyst expectation of 1.04 million, according to Reuters.

Similar to AT&T, Verizon was also affected by the release of the new iPhone 4S, which plagued both companies with weaker than expected smartphone sales. 

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