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Communications

February, 2017

Airtel’s Witnesses a Drop in User Subscription as per Q3-FY17

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Recently announced Q3 reports by Airtel have revealed significant decline in its operating profits and revenues as the free services offered by Reliance Jio have not only impacted the country’s leading mobile operator but also other incumbent telecom service providers. Airtel has also witnessed a lower free cash flow as it could barely generate cash flow from operations to cover its increased capital expenditure.

Bharti Airtel’s Q3 results Show a Remarkable Decline

Airtel’s quarter on quarter decline with reference to Mobile internet user base was reported to have fallen by 12% (around 7.74 million) from 62.66 million to 54.91 million. In the previous year Airtel had reported 54.86 million mobile internet users.

The company also recorded a 9% quarter on quarter decline of 3.46 million mobile broadband base of 3G + 4G users. This decline was from 41.33 million to 37.69 million. Airtel’s mobile internet base had almost half the decline of broadband customers. Previously in the quarter Q1 FY17, the company reported 36.57 million mobile broadband users. The mobile operator’s 2G customer mobile internet base also declined by 19% from 21.32 million to 17.22 million.

For the first time in the quarters so far, the mobile data consumption went down by 6.3 million MBs to 171.81 million MBs from 178.12 million MBs. However, the preceding quarter (Q1 FY17) was 158.03 million MBs.

The Data ARPU (Average Revenue per user) declined to INR 175 from INR 201 in the preceding quarter. Airtel’s Data ARPU was lower than this only two years back in December 2014.

The average data usage per customer declined to 972 MB per customer. Data Realisation per MB was recorded declined to 17.97 down 10% from 20.08 MB last quarter. Mobile Internet revenues went to INR 3087 crore from INR 3583.1 crore.

Revenues from Voice

Reliance Jio, although created a great impact on the mobile data service operator’s businesses, the voice services still managed to assist the telecom operators in sustaining their revenues to some extent. From 406 minutes the voice usage per user increased to 419 minutes and the minutes on network increased to 330.2 million from 313.4 million. Airtel tried to drop rates and the Voice Revenue per minute declined to 29.42 paise from 32.43 paise per minute.

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