China Comservice H1 2026: Revenue Falls to RMB74.48 bn, Net Profit at RMB1.97 bn; AI+ Businesses Surge 62%

Bulletin Express
Yesterday

China Communications Services Corporation Limited (China Comservice) released its interim results for the six months ended 30 June 2026. Revenue slipped 3.2% year on year (YoY) to RMB74.48 billion, while net profit attributable to shareholders decreased 7.5% YoY to RMB1.97 billion (down 3.2% on a comparable basis).

Gross profit fell 5.8% to RMB7.43 billion; gross margin narrowed by 0.3 percentage point to 10.0%. Operating profit edged up 1.2% to RMB1.73 billion as selling, general and administrative expenses were trimmed 7.7% to RMB5.71 billion.

By business line, Telecommunications Infrastructure (TIS) revenue declined 4.4% to RMB36.60 billion; Business Process Outsourcing (BPO) slipped 1.2% to RMB22.10 billion; Applications, Content & Other (ACO) contracted 3.1% to RMB15.77 billion.

Revenue in the domestic telecommunications operator market rose 1.9% to RMB38.92 billion, buoyed by demand for new digital infrastructure. The domestic non-operator market posted RMB33.25 billion, down 9.1% as lower-margin projects were de-emphasised. Overseas revenue grew 7.4% to RMB2.31 billion, with momentum from Belt-and-Road projects in Southeast Asia and the Middle East.

Cost of revenues declined 2.9% to RMB67.05 billion. Subcontracting charges dropped 4.1% to RMB41.18 billion, while materials costs rose 8.7% to RMB14.50 billion. Direct personnel costs decreased 11.3% to RMB3.29 billion as staff mix was optimised.

AI-related businesses—including AIDC and AI applications—generated 10% of total revenue (about RMB7.45 billion), up 62% YoY. New contracts in the company’s “Six Major Growth Areas+” climbed 11% YoY and accounted for roughly 34% of total new contract value.

Net cash outflow was reduced to RMB6.81 billion (H1 2025: RMB8.07 billion). Total assets stood at RMB139.21 billion, while total liabilities were RMB90.08 billion, resulting in a liabilities-to-assets ratio of 64.7%.

To enhance shareholder returns, China Comservice announced a three-year dividend plan, targeting a payout ratio of not less than 46% for the financial year ending 31 December 2028. No interim dividend was declared for the period.

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