October 21, 202
New Delhi, India
Introduction
Bharti Airtel, a major player in the telecommunications industry, recently disclosed its financial performance for the second quarter of fiscal year 2023-24. The report unveiled a mix of positives and challenges impacting the company’s standing.
Profit Decline
The company reported a substantial decline in its net profit, down by 37% to ₹1,341 crore compared to the same quarter in the previous fiscal year. This significant drop in profit raises concerns for stakeholders and investors.
Revenue Growth and Shortfall
Although the revenue grew by 7%, reaching ₹34,527 crore in the second quarter of 2023, the numbers fell short of analyst expectations. The company attributed this to various factors, including the impact of the Nigerian Naira devaluation on its revenue growth.
Check: Q2 results
ARPU Improvement
Bharti Airtel exhibited positive growth in Average Revenue Per User (ARPU), rising to ₹203 from ₹190 in the corresponding period of the previous fiscal year. This signifies an increase in the revenue generated per user, which is a positive indicator for the company.
Operational Performance
The company experienced a rise in total minutes of usage on the network and a notable surge in mobile data traffic, indicating increased engagement with their services. This showcases a positive trend in user behavior and utilization of Airtel’s offerings.
Debt Status
While the consolidated net debt (excluding lease obligations) decreased to ₹1,47,459.3 crore, the inclusion of leases brings the consolidated net debt to ₹2,07,015.8 crore. This indicates the need for ongoing management of the company’s financial obligations.
Segment-wise Performance
Within India, revenue from mobile, home services, and digital TV segments surged by 10.9%. Mobile revenues specifically witnessed an 11% year-on-year increase, accompanied by improvements in EBITDA and margin.
Conclusion
The financial results of Bharti Airtel’s Q2 FY24 present a mixed picture. While the company demonstrated positive growth in various operational aspects such as ARPU and user engagement, the decline in profits and revenue missing expectations pose challenges. Moving forward, addressing profitability concerns and managing costs effectively will be critical for sustained growth.
