New quality productivity drives new growth and reshapes the pattern.
With the annual reports of listed companies coming to an end, the 2023 results of various telecom listed companies have been released. The 8th "Performance of China's 100 Listed Communications Companies" monitored by all media of "Communication Industry News" was released.
Driven by digitalization and intelligence, 100 listed communications companies have achieved double growth in revenue and profit. Although the situation of different tracks is different, the new growth driven by new quality productivity is gradually reshaping the pattern. The 100 listed communications companies cover nine categories, including telecom operations, service operation and maintenance, network equipment, optical communications, wireless communications, software services, network services, computing and terminals, chips and cards. There are 63 listed companies on the Shenzhen Stock Exchange, 16 on the Shanghai Stock Exchange, 18 on the Hong Kong Stock Exchange and 3 on the New Third Board. The total revenue of the 100 listed companies was 3.67 trillion yuan, an increase of 18.4% over the previous year, and the total net profit was 246.99 billion yuan, a year-on-year increase of 18%, and the overall performance showed steady growth. Of the 100 listed telecommunications companies, 74 are profitable and 26 are loss-making. The number of companies with revenue growth was 54, and the number of net profit companies increased by 50. Among them, enterprises in the categories of telecom operation, network equipment, and service operation and maintenance performed well. Optical modules, Internet of Things, enterprise private networks, IDC and other fields are growing rapidly. According to the analysis, the overall growth rate of the communications industry will slow down in 2023, the focus of revenue will shift downward, and the growth rate of net profit will be more differentiated. In terms of quarterly data, the overall Q4 revenue of communication equipment in 2023 increased by 3.2% year-on-year, reversing the downward trend of growth in 10 quarters. The switch between the old and new kinetic energy of the industry has been completed, and AI computing power has become a new engine driving the growth of the industry.
The head effect of the industry continues to increase
Among the 100 companies, there are 7 companies with revenues of more than 100 billion yuan, namely China Mobile, China Telecom, Lenovo Group, China Unicom, Xiaomi Group, China Communications Services, and ZTE. The eighth to tenth places are China Tower, Aisid and Unisplendour. The revenue of the top 10 companies exceeded 70 billion yuan. There are 25 companies with revenues of more than 10 billion yuan, 78 companies with revenues of more than 1 billion yuan, and 100 companies with revenues of more than 200 million yuan.
The average revenue of 100 companies was 36.734 billion yuan, and the companies that exceeded the average revenue were concentrated in the top 13 companies. The average net profit of 100 companies was 2.47 billion yuan, and the companies exceeding the average net profit were concentrated in the top 11 companies. On the whole, the revenue of the communications industry will maintain steady growth in 2023, but the net profit will be under pressure, especially the performance pressure of smaller enterprises. As the cornerstone of the development of the communications industry and the chain length enterprise, the total revenue of the three major operators was 1,895.6 billion yuan, a year-on-year increase of 6.9%, accounting for 51.6% of the total revenue of 100 companies. The total net profit of the three major operators was 170.4 billion yuan, a year-on-year increase of 6.3%, accounting for 69% of the total net profit of 100 enterprises. The revenue and net profit of the three major operators all increased. China Telecom's revenue has maintained growth for many years, China Unicom's net profit has achieved double-digit growth for seven consecutive years, and China Mobile's revenue in 2023 has exceeded the trillion yuan mark, and the fundamentals of operators continue to improve. In 2023, the three major operators achieved good growth, achieved initial results in business transformation, long-term high-quality development of digital and cloud-related businesses, and maintained a high growth rate in revenue from the rapid development of emerging services such as data centers, cloud computing, big data, and the Internet of Things. In addition to the three major operators, central state-owned enterprises such as China Tower and China Communications Services performed well, and continued to increase R&D investment and cultivate emerging businesses, providing strong support for performance growth. The two wings of China Tower's business have developed well, and China Communications Services ACO business has grown rapidly, showing long-term growth potential. In 2023, AI is profoundly reshaping the pattern of the communications industry. Carriers continue to grow well, communication equipment companies accelerate the deployment of computing power and AI, and the development of the computing power industry chain in mainland China accelerates, and AI and computing power capabilities have gradually become the "winners and losers" of companies in the communications industry.
The industrial chain is under pressure in the short term
In terms of revenue growth, there were 54 companies with revenue growth of 100 companies, a decrease of 12 from the previous year; revenue decreased to 46; 22 companies increased their revenue by more than 10%. Among them, service operation and maintenance enterprises accounted for the largest proportion, reaching 8. followed by optical communication enterprises, with 4. Four operation and maintenance companies, including Shenzhou Taiyue, Aowei Communication, Zhongfutong and Super Communication, all increased by more than 20%. The four optical communication companies are Tefa Information, Zhongtian Technology, Zhongji InnoLight and Changjiang Communication, and the revenue of Tefa Information increased by 17.79%.
In terms of net profit, there were 74 profitable enterprises per 100 companies, a decrease of 4 from the previous year, and 26 loss-making enterprises. One company with a net profit of more than 100 billion yuan is China Mobile, with a net profit of 131.8 billion yuan in 2023, ranking first in the communications industry, and 16.61 billion yuan more than the total net profit of 99 other companies. In addition to China Mobile, China Telecom, Xiaomi Group and Lenovo Group have net profits of 30.4 billion yuan, 17.48 billion yuan and 11.04 billion yuan respectively. The top 10 companies in terms of net profit are China Mobile, China Telecom, Xiaomi Group, Lenovo Group, China Tower, ZTE, China Unicom, China Communication Services and Zhongtian Technology, with a net profit of more than 3 billion yuan. The categories are distributed in telecom operations, computer terminals, service operation and maintenance, network equipment, and optical communications. Xiaomi Group is the company with the largest net profit in computing and terminals, with a net profit of 17.48 billion yuan. China Tower is the enterprise with the largest net profit in service operation and maintenance, with a net profit of 9.75 billion yuan. ZTE is the company with the largest net profit of network equipment enterprises, with a net profit of 9.326 billion yuan. Zhongtian Technology is the most profitable enterprise in optical communication, with a net profit of 3.117 billion yuan. There were 20 companies with a net profit of more than 1 billion, an increase of 3 over the previous year. There were 49 companies with a net profit of more than 100 million yuan, an increase of 1 over the previous year. Among the 74 profitable companies, the smallest net profit among the profitable companies is Jida Communications, with a net profit of 3.7582 million yuan.
In terms of net profit growth, 50 of the 100 enterprises increased their net profits, a decrease of 17 from the previous year; There were 50 companies with a decline in net profit; There were 3 companies with a net profit increase of more than 200%, a decrease of 3 from the previous year; There were 7 companies with a net profit growth rate of more than 100%, a decrease of 13 from the previous year; The seven companies are Dongtu Technology, Xiaomi Group, Wangsu Technology, Southern Communication, Yitong Century, Chuling Information and Zhongdaan. Dongtu Technology ranked first in net profit growth, reaching 1199.22%, and the net profit growth rates of the remaining six companies were 606.34%, 221.68%, 164.15%, 143.86%, 122.47% and 102.31% respectively. There are 26 companies with a net profit increase of more than 30%, and 40 companies with an increase of more than 10%. Among the 50 companies with net profit growth, Accelink had the smallest net profit growth, with a growth rate of 1.8%.
There were 26 profit-losing enterprises, an increase of 4 over the previous year, with an average loss of 410 million yuan. Among them, 9 companies turned from a profit in the previous year to a loss, and the remaining 17 companies continued to lose money. The companies that turned from profit to loss were Huichang Communication, Hytera, Tefa Information, 263, Nanjing Panda, Riseconda, Tatfook Technology, Zhongfutong, and Huaxing Venture. Among them, the net profit of Huichang Communication decreased the most, with a year-on-year net profit of -3068.11%, followed by special information, with a year-on-year net profit of -2141.22%; The third decline was 263, and the net profit was -897.37% year-on-year. The top 10 companies in profit loss all have losses of more than 300 million yuan. Among them, computing and terminal companies account for a relatively large proportion, and Visionox will lose 3.726 billion yuan in 2023. In recent years, the mainland panel industry has achieved a breakthrough, and the focus of global LCD panel shipments has shifted to China. However, panel companies are still facing many pressures such as price competition and involution.
Due to macro factors such as the decline in domestic informatization and digitalization spending, 5G, ICT, traditional data centers and other fields are under short-term pressure.
AI helps reshape the pattern of subdivided fields
Among the 9 categories of 100 enterprises, telecom operators had the highest net profit, with an average revenue of 476.397 billion yuan, an increase of 7.2% year-on-year, and an average net profit of 42.908 billion yuan, a year-on-year increase of 6.2%.
The average net profit of computing and terminal companies ranked second, with average revenue and net profit of 92.647 billion yuan and 2.860 billion yuan respectively, a significant increase from 59.506 billion yuan and 117 million yuan in the previous year. Due to the addition of Lenovo Group to the 100 companies, the average value of computer terminals has increased significantly. In 2023, Lenovo Group's revenue will be 425.4 billion yuan, down 6.30% year-on-year, and its net profit will be 11.04 billion yuan, down 14.19% year-on-year. Xiaomi Group's revenue in 2023 will be 271 billion yuan, and its net profit will reach 17.48 billion yuan, an increase of 606.34% year-on-year. Smartphone revenue reached 157.5 billion yuan, setting a new record, and the average selling price of smartphones increased by more than 19% year-on-year. Xiaomi's IoT and living consumption reached 80.1 billion yuan, and the number of users with five or more devices connected to the AIoT platform increased by 25.3% year-on-year. In the field of mobile phones and pan-smart terminals, the inventory cycle bottomed out and reversed in the fourth quarter of 2023 and began to enter a new upward cycle. At the same time, AI empowers terminal innovation and leads a new round of product cycles. The trend of large models sinking to the end side is obvious, and the new AI mobile phone products will gradually generate new replacement needs, driving the industry to recover. The average revenue and average net profit of network equipment companies ranked third, with an average revenue of 20.634 billion yuan, a year-on-year decrease of 20.49%; The average net profit was 1.064 billion yuan, down 15.7% year-on-year. Among the 12 network equipment companies, SIEMIC Mobile and Riseconda lost 357 million yuan and 202 million yuan respectively. Seven companies achieved revenue growth, namely Tianfu Communications, Xinke Mobile, Dongtu Technology, Unisplendour, Xingwang Ruijie, ZTE and Millison, except for Tianfu Communications and Xinke Mobile, the growth rate of the other five was a single digit. The revenue of equipment companies in Q4 2023 and Q1 of 2024 increased by 6.8% and 3.2% year-on-year, and the growth rate has slowed down since Q1 of 2021, but Q4 of 2023 and Q1 of 2024 will resume growth for two consecutive quarters. The average revenue of service operation and maintenance companies ranked fourth, with an average revenue of 16.644 billion yuan, an increase from 14.154 billion yuan in the previous year, and an average net profit of 961 million yuan, an increase from 773 million yuan in the previous year, ranking fifth in the average net profit. The average revenue of optical communication companies ranked fifth, with an average revenue of 11.298 billion yuan, an increase from 10.321 billion yuan in the previous year. The average net profit was 710 million yuan, up from 537 million yuan in the previous year, and the average net profit ranked sixth. Benefiting from the rapid development of AI in optical communication, AI has further opened up the profit growth space of optical communication enterprises. The construction of 400G backbone network is expected to promote the growth of related optical communication and other business needs. In 2024, the global demand for optical fiber and cable will resume growth, and maintain a steady growth trend from 2024 to 2028. In 2024, the bidding schedule of various countries is tight, and it is expected that the growth momentum of offshore wind power installation may turn positive in the next few years, and the offshore wind submarine cable will become an important incremental highlight of the industry. The average revenue of chip and card companies ranked sixth, with average revenue and net profit of 6.640 billion yuan and 977 million yuan, down from 6.874 billion yuan and 1.073 billion yuan in the previous year. The average net profit ranked fourth. The average revenue and average net profit of wireless communication companies ranked seventh, with average revenue and average net profit of 4.940 billion yuan and 163 million yuan, up from 4.505 billion yuan and 148 million yuan in the previous year. The companies with the largest revenue were Dongshan Precision (33.651 billion yuan), Quectel Communications (13.861 billion yuan) and Sanwei Communications (12.489 billion yuan), the companies with the largest net profit were Dongshan Precision (1.965 billion yuan), Higer Communications (703 million yuan) and Fibocom (564 million yuan), and the companies with the largest profit growth were Mobi Development (74.24%), SUNSEA Intelligence (71.42%) and Gaoxing (62.12%). Among the 24 wireless communication companies, there are 6 loss-making enterprises, namely Junzhi Group, Mobi Development, Gaoxincn, Tatfook Technology, Shuobeide and Sunsea Intelligence. Except for Tatfook Technology, which turned from a win to a loss, the remaining 5 companies were continuous losses. Base station antennas, RF devices, PCBs, etc., the downstream demand is steadily shrinking, and the industry is in the adjustment stage. In the context of the continuous development of 5G RedCap and the continuous increase in the demand for edge computing power in the AI era, it is expected to bring industry changes to the IoT module, promote the IoT industry to continue to move forward in the new era of "intelligent connection of all things", and the IoT module sector is expected to continue to move upward. The average revenue and average net profit of software service companies ranked eighth, with an average revenue of 4.340 billion yuan, an increase of 2.184 billion yuan from the previous year, and an average net profit of 124 million yuan, a decrease of 165 million yuan from the previous year. Software service companies had the lowest average revenue in 2022 and improved in 2023, with 4 making profits and 4 losing money. The largest profit was iFLYTEK (657 million yuan), an increase of 17.12% year-on-year. With the blessing of the iFLYTEK Xinghuo model, a number of businesses of iFLYTEK have grown significantly. The average revenue and average net profit of network service companies ranked ninth in the end, with an average revenue of 2.384 billion yuan, a year-on-year decrease of 32.4%; The average net profit was 102 million yuan, an increase of 1175% over the previous year. The company with the highest net profit was Wangsu Technology, with a net profit of 191 million yuan, an increase of 221.68% year-on-year. Looking back on the performance of the communications industry in 2023, new kinetic energy and new quality productivity such as computing power networks, 5.5G, low-altitude economy, Beidou satellite communications, intelligent connected vehicles, and XR led by AI have ended the slowdown in the communications industry for 10 quarters, and have begun to resume growth and accelerate.
Co-ordination, report analysis: Cui Liangliang testing and research: Gao Chao Xiaoyan Zhao Yan Dang Bowen Hu Yuan Expert support: Tsinghua X-Lab Innovation Mentor Gong Bin Chart production: Zhang Shunian Editing and proofreading: Liangliang Guidance: Xinwen
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