Bharti Airtel Q2 results: Net profit rises 168% to ₹3,593 crore

Telecom tariff hikes in June lit up the September quarter for Bharti Airtel Ltd on Monday, even as India's second-largest telco said further increases were required to facilitate sustained investments.

Powered by a strong momentum in the domestic market, the Sunil Mittal-led telco posted a net profit of ₹3,593 crore during the September quarter, up 168% from a year earlier. Consolidated revenues at ₹41,473 crore were up 12%, while earnings before interest, tax, depreciation and amortization (Ebitda) was up 12% at ₹22,021 crore. Ebitda margins rose to 53.1% from 52.7% last year. The company added more subscribers during the quarter, and earned more from them on average.

“The flow-through of tariff repair is in line with our expectation on Arpu (average revenue per user) increase and Sim consolidation,” said Gopal Vittal, CEO and MD. “Our focus on winning quality customers and driving premiumization has helped us add 4.2 million smartphone customers.”

Airtel, along with other private telcos, had raised tariffs by 10-21% in June this year, the third such hike since 2019. Sim consolidation refers to a reduction in the number of mobile connections, often due to high tariffs.

Vittal, who was named Bharti Airtel vice-chairman on Monday, reiterated the need for “further tariff repair” for sustained investments, given the low return on capital employed (ROCE) for India.

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“Our balance sheet remains solid, supported by cash generation and continued deleveraging. However, the industry still requires further tariff repair for sustained investments, with ROCE for India at only 11%.”

BofA Securities had estimated Airtel’s consolidated net profit to rise by 77% on year, revenue by 12%, Ebitda by 11% and margins by 52.2%.

Airtel’s India business quarterly revenue stood at ₹31,561 crore, up 16.9% on-year and 8.7% on-quarter, backed by improved realizations in the mobile segment and a sustained momentum in the homes and enterprise business. India mobile services revenue was up 18.5% at ₹24,837 crore.

Sequentially, net profit was down 13.6%, revenue up 7.7% and Ebitda up 10.4%.

In October, Reliance Jio Infocomm, India's largest telecom operator, beat estimates on revenue, profits and Arpu, driven largely by the tariff hikes. Jio had said the full impact of the tariff hike will manifest in the next two to three quarters.

Management changes

Bharti Airtel also unveiled its succession plan on Monday, under which Vittal, Airtel's MD & CEO since 2012, has been made vice-chairman effective immediately, in addition to his existing position as MD, and will move up as executive vice-chairman from 1 January, 2026.

Under Vittal’s leadership, Airtel has seen its revenue market share grow to 40% from 30% and market capitalisation rise fivefold to cross the $100 billion mark, the company said.

Chief operations officer Shashwat Sharma has been appointed CEO-designate, responsible for the entire end-to-end consumer business. Sharma will continue to report to Vittal, who continues to head Airtel Business, and will take over as MD and CEO of Bharti Airtel on 1 January, 2026. Vittal will be responsible for mentoring and grooming Shashwat to take over as MD & CEO for the entire business.

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“Airtel has had a distinguished record of well thought out structured succession planning,” said Sunil Bharti Mittal, chairman, Bharti Airtel. “I am extremely pleased with the succession and transition plan of leadership at Airtel, and there could not have been a better time for Airtel to unveil the new arrangement where change and continuity will go hand in hand. Empowerment has been an article of faith with me which has resulted in a highly energized management delivering superior results. Airtel is one of the rare home grown enterprises where the finest professionals combine entrepreneurial flair to bring to hundreds of millions of customers, the best technology and services in our industry,” Mittal said.

Airtel added that Rakesh Bharti Mittal, a board member for nine years in his current term, will move on to the boards of Indus Towers Ltd and Bharti Hexacom Ltd. “Rajan Bharti Mittal returns to Airtel to be the Bharti board nominee with immediate effect,” it said.

Also, Amit Tripathi, currently director, marketing and customer experience, will be director, market operations, leading all circles and distribution strategy.

Quarterly increase

The telco added 26.2 million smartphone data users in the quarter and 0.8 million postpaid users, raising Arpu, a key metric of profitability, to ₹233, from ₹203 last year, and ₹211 in the June quarter. In comparison, No. 1 carrier Reliance Jio’s Arpu rose to ₹195.1 from ₹181.7 in the June quarter.

For Airtel, mobile data consumption in India surged 22.6%, with average monthly usage reaching 23.9 GB per customer. Airtel’s overall customer base stood at 563 million, with India at 407 million and Africa at 157 million.

The African operations reported profit of $48 million in the quarter, down 65% from $138 million in the same quarter last year, largely due to the impact of currency devaluation, while revenue shrank 2.6% to $1.21 billion.

Airtel’s shares closed unchanged at ₹1663.5 on BSE on a day the benchmark Sensex index gained 0.65%. The earnings were released after market hours.

“We continue to expand our WiFi coverage with FWA (fixed wireless access) offerings to over 2,000 cities. We continue to invest in our digital businesses to diversify portfolio strength and drive long term growth,” he added.

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As part of its financial strategy, Airtel prepaid ₹8,465 crore towards its deferred spectrum liabilities from 2016, which had an interest rate of 9.3%. The net debt rose to ₹2.2 trillion in the quarter, up from ₹2 trillion in the same period last year.

In the quarter, the telco added 5,000 towers and 15,200 mobile broadband stations, while deploying new spectrum acquired in June to enhance connectivity across key regions.

Airtel said it will de-couple DTH from the converged entertainment category and create two different categories – connected homes that will include broadband and converged entertainment, and DTH. Siddharth Sharma, currently CEO of DTH, will be appointed director, marketing and CEO of connected homes, while Pushpinder Gujral, currently CEO of upper north, will be appointed CEO and director for DTH.

Customer experience will be separated into a standalone function, which will be headed by Shivan Bhargava, who has been appointed as director, customer experience. These changes will come into effect from 1 April, 2025, and these executives will report to Shashwat Sharma.