CHINA TELECOM's revenue in 2024 increased by 3.1% year-on-year, with smart revenue surging twofold, capital expenditure decreased by 5.4% year-on-year, and AI and quantum technology became the focus of strategic layout | Financial Report Insights

In today's world, where the digital wave is sweeping across the globe, China Telecom has delivered an impressive performance report, thanks to its deep accumulation and continuous innovation in the telecommunications field. In 2024, the company's revenue and net profit showed steady growth, with new business performance shining brightly. Intelligent revenue surged nearly twofold, and revenues from Tianyi Cloud, data centers, and video networks all achieved double-digit growth.

On the 25th, China Telecom announced its 2024 performance report, with the following key points:

Revenue Performance: In 2024, the company's operating revenue reached 529.4 billion yuan, a year-on-year increase of 3.1%, with service revenue at 482 billion yuan, up 3.7% year-on-year.

Profitability: Net profit was 33 billion yuan, a year-on-year increase of 8.4%, with basic net profit per share at 0.36 yuan; EBITDA was 140.8 billion yuan, up 2.9% year-on-year.

Core Business Progress: In 2024, mobile communication service revenue reached 202.5 billion yuan, a year-on-year increase of 3.5%, with mobile value-added and application revenue growing by 16.1% year-on-year; fixed-line and smart home service revenue reached 125.7 billion yuan, up 2.1% year-on-year, with smart home business revenue increasing by 16.8% year-on-year; industrial digitalization revenue reached 146.6 billion yuan, a year-on-year increase of 5.5%.

Emerging Business Performance: Tianyi Cloud revenue was 113.9 billion yuan, a year-on-year increase of 17.1%; IDC revenue was 33 billion yuan, up 7.3% year-on-year; security revenue was 16.2 billion yuan, up 17.2% year-on-year; intelligent revenue was 8.9 billion yuan, a year-on-year increase of 195.7%; video network revenue grew by 40.1% year-on-year.

Capital Expenditure: In 2024, capital expenditure was 93.5 billion yuan, a year-on-year decrease of 5.4%, with mobile network investment at 29.9 billion yuan and industrial digitalization investment at 32.5 billion yuan.

Cash Flow: As of the end of last year, free cash flow reached 22.2 billion yuan, a year-on-year increase of 70.7%.

Shareholder Returns: The board of directors proposed a final dividend of 0.0927 yuan per share, along with an interim dividend of 0.1671 yuan per share, totaling a dividend of 0.2598 yuan per share for the entire year, representing a year-on-year increase of 11.4%. They committed to gradually increasing the cash dividend ratio to over 75% within three years.

Intelligent Revenue Surges Twofold, Strategic Emerging Businesses Become Key Growth Engine

China Telecom's 2024 financial report shows that the company has made significant progress in transformation and upgrading, achieving continuous improvement in operating performance. Notably, industrial digitalization revenue grew by 5.5% year-on-year, increasing its share of service revenue to 30.4%, becoming an important driving force for the optimization of the company's business structure.

From the perspective of business composition, China Telecom is gradually achieving a strategic transformation from a traditional telecommunications operator to a technology-oriented enterprise:

Tianyi Cloud revenue reached 113.9 billion yuan, a year-on-year increase of 17.1%, continuing its strong growth momentum; the growth rate of artificial intelligence business is particularly remarkable, with intelligent revenue reaching 8.9 billion yuan, a year-on-year increase of 195.7%, demonstrating the explosive growth potential of AI business. Video network revenue grew by 40.1% year-on-year, and security business revenue increased by 17.2% year-on-year, making these strategic emerging businesses new growth poles for the company It is worth noting that China Telecom's basic services have not been neglected during the transformation process, but have instead maintained healthy growth. Mobile communication service revenue increased by 3.5% year-on-year, while mobile value-added and application revenue grew by 16.1%; fixed-line and smart home service revenue rose by 2.1%, and smart home business revenue increased by 16.8%. This indicates that the company has successfully achieved the coordinated development of basic and emerging businesses while transitioning to digitalization.

AI and Quantum Technology Become Strategic Focus, Intelligent Computing Resources Reach 62 EFLOPS

China Telecom highlighted the company's strategic layout and achievements in the AI and quantum fields in its financial report. The company has established a "1+1+1+M+N" overall layout for artificial intelligence, creating a multi-modal general large model foundation, and launched over 50 industry-specific large models, serving more than 10,000 industry clients. Notably, the company has widely applied 13 large models internally, covering core operational areas such as customer service, network operations, and office work, effectively assisting enterprises in reducing costs and improving quality and efficiency.

In the field of quantum technology, China Telecom has steadily advanced quantum-safe infrastructure, constructing a new type of cryptographic system that integrates QKD and PQC. The "Tianyan" quantum computing cloud platform has been selected as one of the "Top Ten National Key Instruments of Central Enterprises in 2024." The company is actively promoting the construction of quantum metropolitan networks in 16 key cities, including Beijing-Tianjin-Hebei and the Yangtze River Delta, with the Hefei quantum metropolitan network being among the first batch of "Typical Cases of Digital China" nationwide.

The company is also focused on building a new integrated service model of "computing power + platform + data + model + application." The "Xirang" integrated intelligent computing service platform has served over 4.9 million industry clients, ranking first in China's computing power interconnection scheduling market and leading in the quadrant of China's intelligent computing cloud service market. As of the end of the reporting period, the total intelligent computing power reached 62 EFLOPS, significantly enhancing competitiveness in the intelligent computing field.

China Telecom continues to advance the construction of new digital information infrastructure, especially the upgrade of network infrastructure for AI. The company has built two fully liquid-cooled data centers, with intelligent computing resources reaching 35 EFLOPS, and data centers fully upgraded to AIDC. The total scale of 5G mid-high frequency base stations reached 1.375 million, achieving continuous coverage in towns and above nationwide, with the deep coverage rate in key areas increasing to 90%.

The company has deployed approximately 70,000 5G-A network stations in 121 cities, with RedCap coverage exceeding 200 cities, and the number of 10G PON ports in the gigabit optical network reaching 9.29 million, with urban residential coverage exceeding 95%. In addition, the company is actively promoting the construction of a satellite mobile communication system that coordinates high, medium, and low orbits, with over 2.4 million users directly connecting mobile phones to satellites, and the number of terminal users supported by the Tianyi IoT platform reaching 630 million.

Capital Expenditure Decreases, Cash Flow Improves, Commitment to Gradually Increase Dividend Ratio to Over 75%

China Telecom's capital expenditure for 2024 is 93.5 billion yuan, a year-on-year decrease of 5.4%, while free cash flow reached 22.2 billion yuan, a year-on-year increase of 70.7%, indicating that the company has effectively improved capital utilization efficiency while controlling investment scale. At the same time, the company has increased its investment in technology research and development, with R&D expenses rising by 11.3% year-on-year, demonstrating the company's determination to transform into a technology-oriented enterprise The company's financial condition is good. As of the end of 2024, total assets amounted to 866.6 billion yuan, a year-on-year increase of 3.7%; total liabilities were 410.1 billion yuan, a year-on-year increase of 5.5%; the debt-to-asset ratio was 47.3%, maintaining a reasonable range.

It is worth noting that the company has increased its return to shareholders. The board of directors has proposed a final dividend of 0.0927 yuan per share, along with an interim dividend of 0.1671 yuan per share, making the total dividend for the year 0.2598 yuan per share, which represents a year-on-year increase of 11.4%. Furthermore, it has committed to gradually increasing the cash dividend ratio to over 75% of the annual profit attributable to shareholders within three years starting from 2024