China Mobile Ltd. added about $21 billion of market value in Hong Kong after the world’s biggest wireless carrier by users reported increasing adoption of its fourth-generation services.
The carrier surged 7.5 percent to HK$115.90 at the close of trade, the biggest gain in almost six years. China Mobile added 53 million users to the 4G network in the first quarter, with 143 million customers now on the high-speed network, it reported Monday.
China Mobile has faced increased costs to build its 4G network and attract users with promotions on tariffs and smartphones as it also dealt with reduced customer spending. After the first quarter results, declines in average revenue per user have now hit bottom, according to Anand Ramachandran, an analyst at Barclays Plc.
“Rising 4G adoption should sustain ARPU rises and thus revenue momentum,” Ramachandran wrote in a report to clients. “Rekindled momentum from 4G should allow China Mobile to return to growth.”
Net income dropped 5.6 percent to 23.8 billion yuan ($3.8 billion) in the first quarter, the Beijing-based company said Monday. Sales rose 3.9 percent to 160.9 billion yuan.
The carrier reported 815.4 million subscribers as of the end of March, up 8.75 million from the end of 2014.
Average revenue per user was 59 yuan a month, up from 58 yuan reported in the fourth quarter, the company said.
— With assistance by Edmond Lococo