Latest Developments

In the first half of 2023, our operating revenue was RMB530.7 billion, or growth of 6.8% year-on-year. Of this, our telecommunications services revenue accounted for RMB452.2 billion, an increase of 6.1% year-on-year. Total connections reached 3.19 billion, with a net addition of 250 million. CHBN markets saw all-round growth, with HBN revenue accounting for 42.7% of telecommunications services revenue, an increase of 2.7 percentage points year-on-year. Our digital transformation revenue increased by 19.6% year-on-year and reached RMB132.6 billion, taking up 29.3% of telecommunications services revenue. Profit attributable to equity shareholders was RMB76.2 billion, an increase of 8.4% year-on-year, and earnings per share were RMB3.56. We maintained industry-leading profitability among top-tier global telecommunications operators. EBITDA was RMB183.5 billion, an increase of 5.5% year-on-year. EBITDA as a percentage of telecommunications services revenue was 40.6%. Capital expenditure totaled RMB81.4 billion. Free cash flow amounted to RMB79.1 billion, an increase of 43.3% year-on-year.

We strengthened the integration of data access, applications and customer benefits, and extended our promotion for universal 5G adoption and the China Mobile digital superstore. As a result, our “Customer” market experienced stable-to-rising growth, with revenue reaching RMB259.4 billion in the first half of 2023, an increase of 1.3% year-on-year. Mobile customers totaled 985 million, with a net addition of 10.38 million customers. In our mobile customer base, 722 million were 5G package customers, with a net addition of 108 million. The number of customers using our integrated-benefit products reached 326 million, a net addition of 38.85 million customers. The number of monthly active users of Mobile Cloud Drive, our cloud product, recorded a net addition of 9.76 million customers, bringing the total to 176 million, the second largest in the industry in terms of customer base. The number of customers using our 5G new voice over high-definition video reached 101 million, a net addition of 9.24 million customers. Our range of emerging 5G personal digital products, including cloud XR (augmented reality), cloud games and 5G ultra high-definition video connecting tones, all saw rapid growth. With increased customer value and loyalty, mobile ARPU reached an industry-leading figure of RMB52.4.

We captured the value potential of full-gigabit network and cloud-based applications by deepening our leadership in four areas – gigabit broadband, content-driven TV, platform-based IoT, and ecosystem-enabled HDICT (home data, information and communications technology). As a result, our “Home” market generated favorable growth, with revenue for the first half of 2023 reaching RMB64.9 billion, an increase of 9.3% year-on-year. The number of household broadband customers reached 255 million, or a net increase of 11.15 million, and led the industry. The number of household gigabit broadband customers reached 60.36 million, accounting for 23.7% of the overall household broadband customer base and showing ample room for development from bandwidth upgrade. Our mobile HD customer base reached 201 million. The number of smart home network and home security customers increased by 50.1% and 40.6% respectively year-on-year. HDICT solutions applied in new scenarios such as smart community and digital village have attracted 20.88 million users. Contribution from smart home applications continued to increase, and household customer blended ARPU reached RMB43.3.

We focused our efforts on the integrated development of network, cloud and DICT (data, information and communications technology), by fully leveraging our advantage in cloud and network resources. We focused on Mobile Cloud and 5G industry applications and obtained breakthroughs in scale, and our “Business” market continued to achieve rapid growth. In the first half of 2023, our “Business” market revenue reached RMB104.4 billion, an increase of 14.6% year-on-year. Our corporate customer base reached 24.295 million, with a net increase of 1.099 million customers. Our Mobile Cloud revenue reached RMB42.2 billion, an increase of 80.5% year-on-year. Within Mobile Cloud, the revenue market share of IaaS ranked top 3 in China, with revenue growth of our proprietary IaaS+PaaS exceeding 100%. Cumulatively, we have signed agreements for more than 25,000 5G commercial projects across multiple sectors, driving the value of DICT contracts to RMB20.9 billion in the first half of 2023, or growth of 28% year-on-year. The revenue from our 5G dedicated network reached RMB2.51 billion, an increase of 69.7% year-on-year. We achieved industry leadership in segments including smart mining, smart factories, smart power, smart hospitals, smart city and autonomous driving. We obtained breakthroughs in the new markets of Internet of Vehicles (IoV) and digital government. In the To V market, we forged partnerships with 9 of the top 10 new energy brands in China, ranked by sales volume; in the To G market, we empowered public administration, social governance and services related to people’s livelihoods, securing more than 1,000 projects with contract values exceeding RMB3 million each, showing a growing brand recognition in this space.

The “New” market maintained rapid growth following our efforts to focus on increasing the value contribution from international business, equity investment, digital content and FinTech. Revenue of the “New” market reached RMB23.5 billion in the first half of 2023, an increase of 18.4% year-on-year. In terms of international business, we deepened the synergies between international and domestic markets. We increased the export of high-quality products capabilities and 5G solutions to overseas markets while upgrading our digital infrastructure overseas and further strengthening our international ties. In the first half of 2023, our international business revenue reached RMB10.1 billion, an increase of 25.9% year-on-year. In terms of equity investment, we applied capital to attract and empower the formation and strengthening of industry chains, innovation chains, supply chains, ecological chains and value chains, actively expanding the family and ecosystem of the modern mobile information industry. In terms of digital content, we drew on the China Mobile Metaverse Industry Alliance to assist in our effort to drive the integrated innovation of the digital economy and metaverse, at the same time as enhancing our core products such as MIGU video and cloud games. Digital content revenue reached RMB13.0 billion in the first half of 2023, or growth of 12.5% year-on-year. The number of monthly active users for our cloud games across all platforms boasted a top-of-the-industry scale reaching 120 million. In terms of FinTech, we relentlessly promoted the rapid development of financial services throughout the industry chain, servicing around 600 partners upstream and downstream of the industry chain. We created an all-in-one digital consumption portal across all platforms, driving growth in “and-Wallet” monthly active customers by 64.8% year-on-year.

We systematically built our new information infrastructure centering around 5G, computing force network and capability middle platform. In the first half of 2023, we spent an overall CAPEX of RMB81.4 billion. For full-year 2023, we expect total capital expenditure (5G inclusive) to stand at approximately RMB183.2 billion, which will be funded mainly from cash flow from operating activities.

To create higher returns for our shareholders and share the results of our growth, after giving full consideration to the Company’s profitability, cash flow generation and future development needs, the Company has decided to pay HK$2.43 per share for the 2023 interim dividend, representing an increase of 10.5% year-on-year. Full-year profit to be distributed in cash in 2023 will increase to 70% or above of the profit attributable to equity shareholders of the Company for the year. The Company will strive to create more value for shareholders.

We will fully, accurately and comprehensively align with new principles to ensure we contribute to the new development paradigm. We will firmly adhere to and creatively implement our “1-2-2-5” strategy with precision. We will accelerate the construction of a new growth model driven by innovation and establish a world-class “Powerhouse” to a high standard, breaking new ground as we become a world-class information services and sci-tech innovation enterprise. By doing so, we will continue to bring more value to our shareholders and customers.

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