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Bharti Airtel Q1 Results: Profit Falls 63% On Higher Costs, Flat ARPU – BloombergQuint

Bharti Airtel Ltd.’s quarterly profit fell, missing estimates, as its costs rose and revenue per user remained flat.

Net profit rose fell 62.7% sequentially to Rs 283.5 crore, according to its exchange filing. That compares with the Rs 604-crore consensus estimate of analysts tracked by Bloomberg.

Revenue rose 4.3% quarter-on-quarter to Rs 26,853.6 crore. Analysts had pegged the metric at Rs 26,247 crore. That came as other income rose 150% over the preceding quarter to Rs 209.8 crore.

Highlights (QoQ)

  • Operating profit rose 4.8% to Rs 13,189 crore.

  • Margin expanded to 49.1% from 48.9%.

  • Average revenue per user—the amount an operator earns per subscriber per month—rose to Rs 146 from Rs 145.

  • Overall expenses rose 3.4% to Rs 13,873.3 crore and finance costs increased 9.5% to Rs 4,225.7 crore.

  • Access charges grew 3.3% to Rs 1,616.7 crore, while license fee or spectrum charges rose 5.8% to Rs 2,645.5 crore.

The telecom operator’s average revenue per user remained flat owing to the impact of free recharges offered to low-income subscribers. Lower number of recharges during the lockdown, moderation in overall wireless subscribers and fewer upgrades by 2G subscribers to 4G network amid lack of smartphone shipments impacted the company’s performance in the first quarter.

The company’s 4G subscriber base rose 2.8% quarter-on-quarter to 18.44 crore, with user accretion over the last four quarters standing at 4.6 crore. Its home business segment added the most customers—at 2.85 lakh—in the three months through June to 33.5 lakh.

The company recently hiked prices of its post-paid plans by 20-50% and entry-level prepaid schemes by over 60% to boost ARPU.

Airtel Africa Ltd.’s revenue rose 7.1% quarter-on-quarter to $1.11 billion (Rs 8,184 crore), while profit after tax fell 7.8% over the period to $142 million (Rs 1,046.9 crore). The rise in revenue was supported by growth across regions like East Africa, Francophone Africa and Nigeria, and services like voice, data and mobile money business.