China Telecom H1 profit drops, but free cash flow doubles

China Telecom

20/08/2026 09:48

Overview
China telecom operator's first-half 2026 operating revenue rose, driven by growth in intelligence business
Net profit attributable to equity holders for first half drops to RMB19.6 bln from RMB23.0 bln
Free cash flow for first half surged 121.3% yr/yr

Outlook
Company did not provide specific financial guidance for the current or upcoming periods

Result Drivers
INTELLIGENCE BUSINESS GROWTH - Co said revenue from Intelligence Business rose 7.1% yr/yr, accounting for 12.8% of principal business revenue
CLOUD SERVICES EXPANSION - Co said revenue from China Telecom Cloud grew 7.8% yr/yr to RMB61.8 bln
LOWER OPERATING COSTS – Total operating expenses fell to RMB237.5 bln from RMB242.9 bln, led by lower other operating, network-support and personnel costs

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
H1 Operating Revenue
 
RMB 260.5 bln
 
H1 Net Profit Attributable
 
RMB19.6 bln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 7 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the integrated telecommunications services peer group is "buy"
Wall Street's median 12-month price target for China Telecom Corp Ltd is HK$5.70, about 20.6% above its August 19 closing price of HK$4.73
The stock recently traded at 12 times the next 12-month earnings vs. a P/E of 13 three months ago

Reuters Recommended Reads
Aug 18 - China's Unicom Hong Kong H1 profit falls on VAT, employee benefit expense
Aug 19 - Chinese software firm Chanjet's H1 revenue rises on cloud growth
Aug 18 - China's VNET Q2 revenue rises on wholesale growth; signs compute-energy deal with CATL

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)