China Unicom has reported strong growth in both profit and revenue for the first quarter, due largely to rapid gains in the company's 3G business.
In stark contrast to rival China Mobile – which this week reported a mere 0.3% increase in Q1 profit – Unicom said its net profit for the quarter climbed 89% to 1.9 billion yuan ($307.9 million).
Unicom's revenue increased 15.4% to 57.06 billion. Mobile revenues grew over 20% to 35.24 billion.
The company added 11.4 million mobile subscribers during the quarter, and nearly all of them were 3G customers.
As a result, Unicom's 3G userbase increased to 87.8 million, and 3G users for the first time made up more than half - 54.6% - of the company's total mobile customer base.
Fixed-line revenues grew 5.4% to 21.66 billion yuan, with broadband service revenue increasing 11% to 11.21 billion yuan.
While Unicom's total expenses grew 13.7% year-on-year as a result of network expansions, 3G terminal subsidy costs as a percentage of 3G revenues declined from 15.8% in 1Q12 to 11.6% in 1Q13, due to the availability of lower-cost smartphones.
But total selling expenses increased 22.8% year-on-year, as the company spent big to counter increased market competition.