BEIJING (AP) — China Mobile, the world’s biggest phone company by subscribers, said Thursday its first-half profit rose just 1.4 percent from a year earlier as growth slowed due to competition and an economic slump.
Profit for the six months ending June 30 was 55.3 billion yuan ($8.1 billion), the Beijing-based carrier said. Revenues rose 8.9 percent to 212.9 billion yuan ($31 billion).
Profit growth fell sharply from 45 percent for the comparable period of 2008 and 5.2 percent for the second half of that year. The company blamed China’s economic slowdown, more intense competition and rising mobile phone penetration in China, which makes acquiring new customers harder.
“We believe the group’s solid capital structure and financial strength will provide a solid foundation for sustainable future development,” Chairman Wang Jianzhou said in a statement.
China Mobile has benefited from explosive growth of mobile services in China, where many first-time customers opt for a mobile phone instead of fixed-line service.
Regulators intervened last year to revive competition by restructuring the industry into three groups centered around China Mobile and rivals China Telecom Ltd. and China Unicom Ltd., each with fixed-line and mobile assets.
The companies were awarded licenses for 3G service in December, a move that is expected to ignite new revenue growth as customers gain access to video and other offerings supported by the new system.
The total number of China Mobile accounts rose by 35.8 million over the first six months of 2009, raising the total to 493 million, the company said.