The industry’s big hitters have finished their doing their sums and counting their cash for another quarter and revealed just how they have performed over the quarter gone by. Apple, as per usual, posted a strong growth in profit, and was joined by America Movil, which did the same. Ericsson and NTT DoCoMo, had bad news to report.

Dawinderpal Sahota

October 29, 2012

4 Min Read
Third quarter earnings round-up
Telenor has seen its revenue in 1Q14 grow 7.2 per cent year on year to reach NOK26.5bn ($4.48bn), up from NOK24.7bn in 1Q13

The industry’s big hitters have finished their doing their sums and counting their cash for another quarter and revealed just how well or poorly they have performed in the period gone by. Apple, as per usual, posted a strong growth in profit, joined by America Movil, which did the same. Meanwhile Ericsson and NTT DoCoMo, had bad news to report.

Apple

The iPhone and iPad maker did not break its tradition of reporting positive financial results, recording quarterly revenue of $36bn and quarterly net profit of $8.2bn for the three months ending September 30, 2012. These results compare to revenue of $28.3bn and net profit of $6.6bn in the same quarter a year ago. Gross margin did drop slightly however, to 40 per cent compared to 40.3 per cent in 3Q11. International sales accounted for 60 per cent of the quarter’s revenue.

América Móvil

In the last round of financial results, for 2Q12, the Latin American operator group suffered from foreign exchange losses to the tune 16.1bn pesos ($1.2bn). This time around though, it saw a foreign exchange gain of 9.0bn pesos, which contributed greatly to a sharp increase in the firm’s net profit. At 30.6bn pesos, it was twice as high as in the previous quarter and surpassed the 18.33bn peso profit of the same quarter a year ago by 67 per cent..

Ericsson

Swedish vendor Ericsson, meanwhile, saw a whopping 42 per cent year on year reduction in net income this quarter, from SEK3.8bn ($568m) to SEK2.2bn. Sales also decreased two per cent year on year.

“Demand for global services and support solutions continued to be good, while networks showed a decline in sales year on year. In North America, networks sales developed favourably, despite the expected decline in CDMA sales, while parts of Europe, China, Korea and Russia continued to be slow,” said Hans Vestberg, president and CEO .

China Telecom

Chinese operator China Telecom announced its earnings result for the first three quarters of the year, in which it revealed that its profit fell by 7.8 per cent compared with the first three quarters of 2011.

Despite operating revenue growing from RMB182.48bn ($29.2bn)  to RMB210m – representing a 15.1 per cent increase – net profit stood at RMB12.6m, down from the RMB13.7m the operator recorded in the first three quarters of 2011.

The operator said that its performance was on track as planned for the period, and explained that its profitability was impacted by the marketing investment it made when launching the iPhone 5 on its network.

“This is expected to significantly enhance its long term sustainable growth and value creation despite the short term pressure on its profitability,” the firm said in a statement.

Sprint

US operator Sprint saw its platform wireless service revenue grow by 14 per cent year on year in 3Q12, marking its eighth consecutive quarter of double digit percentage growth year on year.

However, the firm recorded an operating loss of $231m and a net loss of $767m,

The operator has incurred sizeable costs in shutting down its iDEN Nextel network, and has taken 9,600 Nextel sites off air to date – more than it had previously anticipated at this stage.

“The Sprint platform performed well, with strong net subscriber additions, record third quarter postpaid and prepaid churn and robust revenue growth, contributing to Adjusted operating income before depreciation and amortization (OIBDA) of $1.28bn even as we continue to invest in Network Vision and position the company for future growth,” said Dan Hesse, Sprint CEO. “As a result, we believe we will slightly exceed the top of the range of our recently increased Adjusted OIBDA forecast.”

NTT DoCoMo

Japanese operator NTT DoCoMo revealed its earnings result for the first half of the year. Operating revenue was up 4.5 per cent year on year in 1H12, from 2.1tn Yen ($26.4bn) to 2.2tn Yen. Operating income, however, fell 7.4 per cent to 471.1bn Yen from 508.5bn in 1H11.

The firm also saw its aggregate average revenue per user (ARPU) fall 6.3 per cent year on year, from 5,230 Yen to 4,900 Yen. Voice revenue also fell 19.9 per cent, but data revenue 14.9 per cent.

France Telecom

And European operator group France Telecom reported that its consolidated revenues decreased 1.1 per cent in 3Q12, blaming the decline of prices for mobile services in France and other European countries. The firm reported that it had had 227.2 million customers at 30 September 2012, an increase of 3.1 per cent year on year, as the third quarter saw three million net additions.

Chairman and CEO Stephane Richard said that in 2013, operating cash flow is expected to face additional downward pressure due to the rise of a low-cost fourth player entering the French mobile market, and that the macroeconomic and regulatory environment that will continue to be challenging.

“Measures begun in 2011 to deal with these multiple shocks will be expanded on in 2013,” he added. “These measures include a more aggressive commercial pushback, improved offers, exploration of new growth areas as well as the careful management of our cost base. As a result, we can realistically envisage a return to cash flow growth in 2014.”

“I am very confident in the ability of the men and women of France Telecom-Orange to meet these challenges. We have both the means and the ambition to do so.”

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