Bharti Airtel posts $145m loss for Q4 2019, despite increasing ARPUs

Published: 5 February 2020 - 7:40 a.m.

India’s third biggest telco, Bharti Airtel, has posted a $145.2 million (INR1,035 crore) loss for the fourth quarter of 2019, missing analysts’ expectations by more than 50 per cent.

Analysts had predicted that Airtel would post an $89.5 million (INR638 crore) loss. Last year, Airtel posted a net profit of $12 million (INR86 crore) for the quarter.

Despite the heavy loss, Airtel will take heart from the fact that average return per user (ARPU) edged up by around 5.5 per cent, from $1.79 (INR128) to $1.89 (INR135).

Speaking at an industry event in the Indian capital of New Delhi last year, Bharti Airtel’s CEO, Gopal Vittal spoke of the need for India’s telcos to ramp up their ARPUs in the coming months and years.

“The industry average ARPU 3 or 4 years ago stood at around 400 rupees. Now it’s 105 rupees [July 2019]. We need a situation where the cost of doing business goes down. Margins are absurdly low at the moment.

“Current conditions are unsustainable. If ARPU is just increased from around $1.50 to around $3.00, which is not a huge increase in terms of consumer cost, that would totally change the game for us,” he added.

Bharti Airtel has been hit by the Indian Supreme Court’s ruling on the way telcos calculate their adjusted gross revenues, leaving the company liable for $4.9 billion (INR35,500 crore) in outstanding dues. The AGR dues do not appear in Airtel’s Q4 financials.

Airtel remains India’s third largest telco by subscriber and saw an increase in its global customer base to 419 million subscribers across 16 countries in Q4 2019.

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