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2026-10-22 12:55:49 UBS published a research report stating that CHINA MOBILE (00941.HK) announced its 3Q26 results, with service revenue of RMB205 billion, down 5.1% YoY; EBITDA fell 7% YoY to RMB73.9 billion; and net profit was RMB27.3 billion, with the decline widening to 12.4% YoY. Service revenue, EBITDA and net profit were 1% to 5% below market expectations respectively. The broker noted that service revenue declined 4.8% YoY and 5.1% YoY in 2Q and 3Q respectively, exceeding its estimate of a 1.5% to 2% impact from value-added tax changes, indicating that operating pressure was greater than the VAT impact. This was due to difficulties in achieving growth in the traditional telecommunications market, while new AI-driven businesses still require time to scale up. Operating cash flow in 3Q was RMB70.4 billion, down 8.8% YoY, broadly in line with EBITDA. Operating expenses excluding depreciation and amortization fell 1.8% YoY, driven by a 7.7% YoY decline in network operation and support expenses as the company continued to optimize its telecommunications network, which also weighed on revenue growth at China Tower. Depreciation and amortization were broadly flat YoY. The company's outlook remained unchanged. Management guided at the interim results that revenue growth excluding VAT impact would remain stable and healthy, with earnings achieving coordinated growth. The broker lowered its 2026-2028 net profit forecasts by 2% to 5%, assuming slower growth in traditional telecommunications service revenue. It also rolled forward its DCF valuation by three months, leading to a 2% reduction in TP to HKD93. It expected dividends to remain stable and maintained a Buy rating.(ad/u)~ AASTOCKS Financial News Website: www.aastocks.com This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. | |