China Mobile Ltd’s wireless user base shrank in the first quarter as the spread of the new coronavirus shut down China’s economy and prompted millions to cancel services at the country’s largest mobile carrier.

Subscriptions fell by 3.98 million in the three months ended March, the state-owned carrier said in a statement on April 20. Net income fell 0.8% to 23.5bil yuan .

The carrier, which has more than 940 million subscribers, may benefit in the months ahead as economic activity begins to return toward normal. The expansion of 5G coverage planned this year may also help lure subscribers to higher priced heavy-data plans.

While the company is spending to expand 5G networks, it has also been maintaining dividend levels and had cash and bank deposits of about 317bil yuan as of the end of last year.

Attracting 5G subscribers is a key for growth as those users tend to spend more per month. The company had about 31.7 million 5G subscribers as of the end of March.

While total subscribers fell in the first quarter, the carrier benefited from a slight rise in average revenue per user from the previous quarter as the introduction of 5G networks made it easier for users to play richer video games and use applications that consume more data.

China Mobile shares have fallen 6.9% this year, compared with a 14% decline for the benchmark Hang Seng Index, as of Monday.

Mobile average revenue per user per month rose to 46.9 yuan in the first quarter, compared with 46 yuan in the previous three months.

Mobile data traffic rose to 19.7 billion gigabytes, compared with 17.5 billion GB in the previous quarter.

Operating revenue fell 2% year-on-year to 181.3 billion yuan in the first quarter.

 - Bloomberg