Source: Economic Information Daily
The 2023 semi-annual reports of China Telecom, China Unicom and China Mobile have all been released recently. The Economic Information Daily reporter noted that in the first half of this year, the operating performance of the three major operators achieved comprehensive growth, of which industrial digitalization-related businesses maintained rapid growth, and the growth of cloud business was particularly strong. Although the capital expenditure of the three major operators in the first half of this year decreased year-on-year, the investment structure continued to be optimized, and the investment in computing power and AI services was greatly increased.
Industrial digital business is growing rapidly
Overall, in the first half of this year, the operating performance of the three major telecom operators achieved comprehensive growth, and all business indicators made steady progress.
Among them, China Mobile's profitability continued to lead, and the company's operating income in the first half of 2023 reached 530.7 billion yuan (RMB, the same below), a year-on-year increase of 6.8%, of which the main business income reached 452.2 billion yuan, a year-on-year increase of 6.1%. Net profit attributable to shareholders of the parent company was 76.2 billion yuan, a year-on-year increase of 8.4%. Among them, the number of 5G package customers reached 722 million, a net increase of 108 million.
In the first half of this year, China Unicom's operating income and profit scale continuously broke the record since listing. The company achieved operating income of 191.8 billion yuan, a year-on-year increase of 8.8%, of which the main business income reached 171 billion yuan, a year-on-year increase of 6.3%; The net profit reached 12.5 billion yuan, and the net profit attributable to the parent company reached 5.4 billion yuan, a year-on-year increase of 13.7%, achieving double-digit improvement for seven consecutive years.
China Telecom's operating income in the first half of the year was 258.7 billion yuan, a year-on-year increase of 7.7%, the net profit attributable to shareholders of listed companies was 20.2 billion yuan, a year-on-year increase of 10.2%, and the net profit attributable to shareholders of listed companies, net of non-recurring profits and losses, was 20.4 billion yuan, a year-on-year increase of 11.3%.
In recent years, the three major operators have accelerated digital transformation, and in the first half of the year, industrial digitalization-related services grew rapidly, and the proportion of revenue continued to increase, especially the development of cloud services.
In terms of China Mobile, digital transformation revenue in the first half of the year reached 132.6 billion yuan, a year-on-year increase of 19.6%, accounting for 29.3% of its main business revenue. Among them, the digital transformation revenue contributed 84.1% to the incremental revenue of the main business, which is the first engine of the company's revenue growth. Mobile cloud revenue reached RMB42.2 billion, a year-on-year increase of 80.5%, of which IaaS revenue share ranked top 3, and its own IaaS + PaaS revenue grew by more than 100%.
In the first half of the year, China Unicom's industrial Internet revenue reached 43 billion yuan, accounting for more than one-quarter of the main business income for the first time, becoming an important engine to promote the company's revenue growth and structural optimization. Among them, China Unicom Cloud achieved revenue of 25.5 billion yuan, a year-on-year increase of 36%, and the annual revenue will strive to exceed 50 billion yuan.
In the first half of the year, China Telecom's industrial digital business maintained a rapid development trend, with revenue reaching 68.8 billion yuan, a year-on-year increase of 16.7%, accounting for 29.2% of service revenue, an increase of 2.6 percentage points; Tianyi Cloud revenue reached 45.9 billion yuan, a year-on-year increase of 63.4%, maintaining the top three public cloud IaaS and public cloud IaaS + PaaS in the domestic market, the first government public cloud infrastructure, and the first global operator cloud.
The steady growth coincided with the release of medium-term dividend plans by the three major operators, with a total dividend of 63.146 billion yuan.
The investment structure is constantly optimized
According to the half-year report, in the first half of this year, the capital expenditure of the three major operators showed a year-on-year decline, and the investment structure was continuously optimized, of which the investment in 5G construction declined accordingly, and the investment in computing power and AI was constantly increasing.
Specifically, in the first half of this year, the capital expenditure of China Mobile, China Unicom and China Telecom was 81.4 billion yuan, 27.59 billion yuan and 41.6 billion yuan, respectively, a year-on-year decrease of 11.52%, 2.85% and 0.24%. In terms of investment structure, investment in 5G has declined. Among them, China Mobile expects 5G network capital expenditure of about 83 billion yuan in 2023, a decrease of 13 billion yuan from 96 billion yuan in 2022, a year-on-year decrease of 13.54%.
However, the three major operators have further increased their investment in computing power and AI. According to previous announcements, China Mobile expects a total capital expenditure of about 183.2 billion yuan in 2023, which will be mainly used to maintain leading connection quality, optimize the distribution of computing power resources, promote capacity forging and support the development of CHBN business. China Unicom said that it will further expand investment in 2023, and the level of capital expenditure will reach 76.9 billion yuan, of which the proportion of computing network investment will exceed 19%, a year-on-year increase of more than 20%; China Telecom Chairman Ke Ruiwen previously said that China Telecom's investment in 2023 will focus on future development, further optimize the investment structure, and increase industrial digitalization investment by 40%. Among them, the investment in computing power will reach 19.5 billion yuan, and the investment in IDC (Internet Data Center) will reach 9.5 billion yuan.
According to the data of the first half of the year, China Mobile optimized the "4+N+31+X" computing power intensive echelon layout in the first half of the year, with 478,000 IDC racks available to the outside world, a net increase of 11,000, and a cumulative production of more than 804,000 computing power servers, a net increase of more than 91,000 units, and a computing power scale of 9.4EFLOPS. In terms of high-quality computing power networks, Unicom Cloud Pool covers more than 200 cities, with more than 380,000 IDC racks, and the average latency of the backbone network remains industry-leading. In the first half of the year, China Telecom continued to optimize the layout of "2+4+31+X+O" computing power and increase the capacity building of intelligent computing, with intelligent computing reaching 4.7EFLOPS in the first half of the year, an increase of 62%, and general computing power reaching 3.7EFLOPS, an increase of 19%.
At the same time, the R&D investment of the three major operators in the first half of the year increased significantly, of which China Mobile's R&D expenditure in the first half of the year was 8.5 billion yuan, a year-on-year increase of 21.6%, accounting for 1.6% of operating revenue; China Unicom's R&D expenditure in the first half of the year was 2.435 billion yuan, a year-on-year increase of 11.3%, and the number of authorized patents reached 1,326, an increase of 70% year-on-year. China Telecom increased investment in scientific and technological innovation and R&D in key areas such as cloud computing, AI, security, quantum, platforms and networks, with R&D expenses of 4.14 billion yuan, a year-on-year increase of 27.2%, and the number of R&D personnel increased by 21.4% compared with the end of last year. (Source: Economic Information Daily)