China Unicom (CHU) Hit on iPhone Subsidies, Misses Q4 Net Income Views (AAPL)
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China Unicom (NYSE: CHU) may be just another casualty of high subsidies.
According to data from the company, net income jumped 14 percent from 3.7 billion yuan in the same period last year to $671 million (4.23 billion yuan). Analysts were anticipating net income closer to 5.18 billion yuan.
Though it added 9.79 million 3G subs in the quarter, much of that was due to the appeal of Apple's (Nasdaq: AAPL) iPhone. Like Verizon (NYSE: VZ), AT&T (NYSE: T), and Sprint (NYSE: S) here in the States, China Unicom may be another victim of paying out higher subsidies for the right to carry Apple's hot mobile device.
In the U.S., the cost of an iPhone is about $660 each, though carriers generally subsidize that enough for consumers to pay just $200 or so. The carriers than hope to make up the deficit over two years through contract and usage fees.
In addition to subsidies, China Unicom is also spending on expanding its network coverage and quality, as well as overall service quality.
On the NYSE, China Unicom shares have yet to trade.
According to data from the company, net income jumped 14 percent from 3.7 billion yuan in the same period last year to $671 million (4.23 billion yuan). Analysts were anticipating net income closer to 5.18 billion yuan.
Though it added 9.79 million 3G subs in the quarter, much of that was due to the appeal of Apple's (Nasdaq: AAPL) iPhone. Like Verizon (NYSE: VZ), AT&T (NYSE: T), and Sprint (NYSE: S) here in the States, China Unicom may be another victim of paying out higher subsidies for the right to carry Apple's hot mobile device.
In the U.S., the cost of an iPhone is about $660 each, though carriers generally subsidize that enough for consumers to pay just $200 or so. The carriers than hope to make up the deficit over two years through contract and usage fees.
In addition to subsidies, China Unicom is also spending on expanding its network coverage and quality, as well as overall service quality.
On the NYSE, China Unicom shares have yet to trade.
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