China Mobile stock down on weak earnings

China Mobile (CHL.NYSE, 0941.HKG) recorded a 1.5% increase in net profit for the first half of 2012, missing analyst expectations and dragging down the share price by 5% on Thursday, Reuters reported. While China Mobile only reports once every six months, Reuters calculations showed second-quarter profits of RMB34.4 billion (US$5.5 billion) missing the analyst consensus of RMB35.2 billion. Average revenue per user fell 4.3% in the first half to RMB67, suggesting that the company was suffering from increased competition for higher-end data users, which are far more profitable than most users. China Mobile will increase subsidies for new phones in the second half to promote data usage, with plans to spend some US$2.2 billion, according to Xue Taohai, the company’s chief financial officer. China Mobile, the mainland’s largest wireless carrier, is the only service provider not to offer the iPhone and has lagged its competitors in growing its 3G phone service market.