CHT Faces Scrutiny Over Surveillance Notification Practices | CHT Stock News

Author's Avatar
May 22, 2025
Article's Main Image

Senator Ron Wyden has brought attention to significant lapses in compliance by major telecommunication companies, including Chunghwa Telecom (CHT, Financial), regarding government surveillance notifications. In a communication to fellow Senate members, Wyden highlighted how these companies failed to inform senators about surveillance requests for data on government-issued devices. The investigation revealed that none of the telecommunication providers involved, including CHT, had implemented a system to notify senators when law enforcement agencies sought their records. This deficiency points to a critical gap in the obligation of phone service providers to alert officials about such surveillance activities.

CHT Key Business Developments

Release Date: May 08, 2025

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

Positive Points

  • Chunghwa Telecom Co Ltd (CHT, Financial) reported a 4.3% year-over-year increase in net income and EPS for the first quarter of 2025.
  • The company maintained its leading position in Taiwan's mobile market with a revenue share of 40.5% and a subscriber share of 39.1%.
  • Chunghwa Telecom's 5G market share reached 38.7%, contributing to a 42% increase in the average monthly fee uplift from 5G migration.
  • The fixed broadband business saw a 2.5% increase in revenue and a 2.1% increase in ARPU year-over-year, driven by subscriber upgrades to higher speed tiers.
  • The enterprise ICT business experienced a 13% year-over-year revenue increase, with significant growth in cybersecurity, IDC, and cloud services.

Negative Points

  • Despite overall growth, Chunghwa Telecom Co Ltd (CHT) faced a 3.8% year-over-year decrease in income before tax from its EBG fixed voice revenue.
  • Cash flows from operating activities decreased by 8.6% year-over-year due to higher settlements of accounts payable.
  • Free cash flow declined by 17.4% year-over-year, attributed to increased capital expenditures for 5G and 4G equipment deployment.
  • Property, plant, and equipment declined by 1.1% as depreciation expense exceeded net additions of fixed assets.
  • The company experienced a reduction in accounts payable, contributing to a 5.5% decrease in total liabilities.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.