---
title: "Real demand backbone! Is China Mobile the true stock king?"
description: "China Mobile (600941.SH/00941.HK) released its Q1 2025 earnings report (as of March 2025) after the Hong Kong market closed on April 22, 2025 Beijing time. Key points are as follows: 1. Operational da"
type: "topic"
locale: "en"
url: "https://longbridge.com/en/topics/29067474.md"
published_at: "2025-04-22T14:40:44.000Z"
author: "[Dolphin Research](https://longbridge.com/en/news/dolphin.md)"
---

# Real demand backbone! Is China Mobile the true stock king?

China Mobile (600941.SH/00941.HK) released its Q1 2025 earnings report (as of March 2025) after the Hong Kong market close on April 22, 2025, Beijing time. Key highlights:

**1\. Operational Data: Flat Revenue, Steady Profit Growth**.$CHINA MOBILE(00941.HK) **Q1 2025 total revenue was RMB 263.8 billion, essentially flat YoY.** Growth in the company's communication services offset declines in product sales. **Net profit rose 3.4% YoY to RMB 30.6 billion,** driven by improved gross margins and reduced expenses despite stagnant revenue.

**2\. Core Business Performance: Personal Communication Services Dip**.$China Mobile(600941.SH) This quarter's communication service growth was mainly fueled by household and enterprise segments, while the largest personal communication segment saw slight declines. **Mobile subscribers grew 0.8% YoY, but ARPU fell 2.1% to RMB 46.9/month.**

**3\. Capex: Q1 Increase Contrasts Full-Year Reduction Target.** Q1 2025 capex reached ~RMB 36.4 billion (+5.5% YoY). **However, full-year 2025 guidance projects RMB 151.2 billion (-7.8% YoY), indicating further cuts in subsequent quarters.**

**Dolphin Research's Take: Meets Expectations, Steady Performance.**

Flat YoY revenue reflected offsetting trends between communication growth and product sales declines. Profit growth stemmed from margin expansion and cost controls.

Segment breakdown: 1) Personal communication dipped 1% YoY due to ARPU pressure; 2) Household/enterprise services drove incremental growth.

**Subsidy cuts (e.g., reduced number portability incentives) impacted personal communication performance.** Overall, stable profits amid flat revenue met expectations.

**Market focus remains on capex and shareholder returns.** While Q1 capex rose 5.5%, full-year guidance implies contraction. **This should ease cost pressures and boost future profits.** Dividends/buybacks typically occur in Q2/Q3—we expect maintained high payout ratios.

Minor flaws aside, China Mobile remains resilient. Capex discipline supports profit growth. **In volatile markets, its "steady-Eddie" profits and dividends cement its status as a premium "cash cow."**

**I. Key Focus: Capex & Dividends**

**1.1 Capex**

As a capital-intensive business, annual capex of RMB 100-200 billion for infrastructure directly impacts profitability.

**Q1 2025 capex: ~RMB 36.4 billion (+5.5% YoY).** Full-year guidance of RMB 151.2 billion (-7.8% YoY) signals further reductions ahead.

**Post-5G investment peak, lower capex boosts cash profits. Current depreciation exceeds capex, making true earnings power stronger than reported.**

We calculate cash operating profit by adding back depreciation and subtracting capex. **Q1 adjusted cash profit reached RMB 31.7 billion (+3% YoY), exceeding reported profits. TTM ROE held at 9.1%.**

**1.2 Dividends**

Dividends typically occur in Q2/Q3. **We expect ~RMB 50 billion in payouts, maintaining ~79% payout ratio.**

**Domestic-focused operations minimize policy risks. High payouts offer stability in uncertain markets.**

**II. Operations: Flat Revenue, Steady Profits**

**2.1 Revenue**

**Q1 revenue: RMB 263.8 billion (flat YoY).** Communication services (+1.4% YoY) offset product sales (-6.8%).

Personal communication dipped 1% YoY; household/enterprise drove growth.

For the >50% revenue personal segment:

**1) Subscribers:** +0.8% YoY to >1 billion (sequential dip);

**2) ARPU:** RMB 46.9/month (-2.1% YoY), continuing downtrend.

**2.2 Gross Margin**

**Q1 gross margin: 55.8% (+0.7pp YoY),** lifted by favorable service mix.

**2.3 Operating Expenses**

**Q1 opex: RMB 114.5 billion (-0.9% YoY).** Breakdown:

**1) Sales: RMB 14.4 billion (-3.6% YoY, 5.5% of revenue)**—subsidy cuts impacted user growth;

**2) Staff: RMB 37.2 billion (+3%, 14.1% of revenue)**—rigid cost;

**3) Depreciation: RMB 47.9 billion (-0.5%, 18.2% of revenue)**—post-5G relief.

**2.4 Net Profit**

**Q1 net profit: RMB 30.6 billion (+3.4% YoY)**—margin/opex gains offset flat sales.

As noted, cash profits (RMB 31.7 billion) exceeded reported figures due to accounting treatment.

<End>

Dolphin Research's China Mobile archive:

**Earnings:**

2024/10/21 [China Mobile: Zero-Growth "Trapped Beast"? Overblown Fears!](https://longportapp.cn/zh-CN/topics/24642078)

2024/8/8 [1B Users Dancing, RMB1T Revenue Sailing](https://longportapp.cn/topics/23059847)

2024/3/21 [Payout Ratio to Exceed 75% in 3 Years (23Q4 Call)](https://longportapp.cn/topics/20068579)

2024/3/21 [Capex Drop: Will It Become a Money Tree?](https://longportapp.cn/topics/20068182)

**Deep Dives**

2024/1/4 [China Mobile: The Internet's Utility Play](https://longportapp.cn/zh-CN/topics/10911908)

2023/12/19 [The Iron Telecom, The Fleeting Internet](https://longportapp.cn/zh-CN/topics/10580009)

Disclosures: [Dolphin Research Disclaimer](https://support.longbridge.global/topics/misc/dolphin-disclaimer)

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> **Disclaimer**: This article is for reference only and does not constitute any investment advice.