China Telecom reported an 8 percent decline in profit for the first nine months of the year, as costs weighed on the bottom line.

The Chinese number-three said that operating expenses “increased significantly” from a year ago, mainly due to the selling and subsidising of more expensive devices. The operator began offering the iPhone in February, for example, which it admitted created “short term pressure on its profitability.”

Profit attributable to shareholders for the nine months came in at CNY12.6 billion (US$2 billion), down 8 percent, on operating revenue of CNY210 billion, an increase of 15.1 percent. Total operating expenditure was up 18.5 percent to CNY192.1 billion.

According to calculations by Reuters, China Telecom’s net profit for Q3 was down 7 percent to CNY3.8 billion, making it the operator’s third consecutive quarter of profit decline.

Mobile subscribers reached 153 million at the end of September, up from 117 million a year ago. 3G subscribers accounted for 60 million of the total, up from 28 million.

On the fixed-line side, local access lines declined by 3.63 million for the first three quarters (to 166 million), while fixed-line broadband subscribers reached 87 million, representing a net addition of 10 million.