• Revenue: Exceeded $55 billion, marking a seven-year high, with a 3.6% increase from the same quarter last year.

• Net Income: Slight decline of 1% year over year.

• Earnings Per Share (EPS): Stood at 1.16 for the quarter.

• Mobile Service Revenue: Recorded a 2% year over year increase.

• Fixed Broadband Revenue: Increased by 3.4% year over year.

• ICT Business Revenue: Saw a 22% year over year increase.

• Consumer Business Group (CBG) Revenue: Increased by 2.1% year over year.

• Enterprise Business Group (EBG) Revenue: Increased by 5.9% year over year.

• International Business Group (IBG) Revenue: Increased by 1.4% year over year.

• Free Cash Flow: Increased by 8.7% compared to the previous year.

• Capital Expenditure (CapEx): Declined by 15.1% year over year.

• Warning! GuruFocus has detected 5 Warning Sign with FRA:18LB.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Chunghwa Telecom Co Ltd (NYSE:CHT) achieved a new single quarter revenue record for the third quarter, the highest in the last seven years.

• The company reported a 2% year-over-year increase in mobile service revenue, marking 14 consecutive quarters of growth.

• 5G subscriber market share reached 38.8%, surpassing overall mobile subscriber share.

• Fixed broadband revenue and ARPU increased by 3.4% and 1.5% year-over-year, respectively.

• ICT business revenue saw a significant 22% year-over-year increase, driven by strong performance in emerging services.

Negative Points

• Income from operations and net income saw slight declines of 0.8% and 1% respectively, due to higher manpower costs and increased broadcast rights fees for the Olympic Games.

• Profit before tax declined for consumer and enterprise segments, partly due to increased electricity costs and investment in video content.

• Despite revenue growth, the company faced challenges in offsetting declines in mobile voice and fixed line voice revenues.

• Higher operational expenses were noted due to increased utility costs following a government decision to raise electricity prices.

• The company did not disclose the specific contribution of emerging enterprise application revenue to total enterprise revenue.

Q & A Highlights

Q: Why did profit before tax decline for the consumer and enterprise segments despite revenue growth? A: Wen-Hsin Hsu, CFO, explained that the decline was due to several factors: the high base from last year's government subsidy, increased employee costs as part of a strategy to improve the talent pool, higher electricity costs, and investments in video content for the Olympics. These are seen as strategic investments for future growth rather than just expenses.