Canada's BCE quarterly profit misses estimates on higher expenses

(Reuters) - BCE Inc's BCE.TO quarterly profit missed analysts' estimates on Thursday, hurt by higher expenses as the Canadian telecom company invests heavily to upgrade its network and win more wireless customers.

The company said operating costs from the wireless business rose 4 percent in the second quarter.

The Montreal-based company, popularly known as Bell Canada, said it added 122,092 net postpaid wireless subscribers, an increase of 37.8 percent while revenue from the business rose 5 percent to $2.05 billion.

Bell Canada, which has been investing heavily to upgrade its network to compete with rival Rogers Communications Inc RCIb.TO, has been gaining from government contracts helping it boost its customer base.

The company has a six-year contract with Shared Services Canada (SSC), the department that oversees information technology services government-wide, to provide mobile network and services.

Bell Canada also won a contract from the government of Alberta to provide internet services to schools, hospitals, libraries, government facilities across the province.

Net income attributable to its shareholders fell to C$704 million ($540.25 million), or 79 Canadian cents per share, in the second quarter, from C$765 million, or 85 Canadian cents per share, a year earlier.

Total operating revenue rose to C$5.79 billion from C$5.69 billion.

Excluding items, Bell Canada earned 86 Canadian cents per share.

Analysts were expecting the company to report a profit of 88 Canadian cents per share and revenue of C$5.80 billion, according to Thomson Reuters I/B/E/S.

Reporting by Laharee Chatterjee in Bengaluru; Editing by Shailesh Kuber