Mexico's America Movil seen reporting lower third-quarter profit

MEXICO CITY (Reuters) - America Movil, Latin America's largest phone company, is likely to report a lower third-quarter profit in spite of slightly higher sales, as it faces tough competition in its main markets, according to analysts.

The company, controlled by billionaire businessman Carlos Slim, is expected to report next Thursday a quarterly profit of 25.656 billion pesos (1.20 billion pounds), according to a Reuters survey of five analysts.

America Movil is having to spend more on subsidies for expensive Internet-enabled smartphones to attract new subscribers from competitors in Brazil and other markets in the region.

That spending, coupled with heavy planned investment to improve its networks, will dampen core profit and net income, according to analysts.

America Movil has been trying to expand outside Latin America in an effort to seek sales as its main markets in the region come under pressure from increased competition and regulation.

But earlier this week the company said it would not go ahead with a plan to buy more of Dutch telecom KPN, after an independent foundation acted to block the deal.

(Reporting by Elinor Comlay and Tomas Sarmiento; Editing by Chizu Nomiyama)