Reliance Jio Infocomm Limited (Jio) reported a net profit of Rs 612 crore, up 20% for the quarter ending June 30, 2018. Its operating revenue for the period stood at Rs 8,109 crore, while its EBITDA for the quarter stood at Rs 3,147 crore. In the previous quarter (Q4FY18), the company had posted a lower operating revenue of Rs 7,128 crore and EBITA of Rs 2,694 crore.
As of the end of the quarter (June 30), the company claims to have 215 million subscribers, up 15.4% from 186.6 million in the previous quarter. The company doesn’t mention how many of these are active.
- Data consumption: 10.6 GB per month per user, up 9.27% from the previous quarter.
- VOLTE voice: 744 minutes of VOLTE voice per month per user, up 3.91% from the previous quarter.
- Video consumption: 15.4 hours per month per user, 11.59% from the previous quarter.
- ARPU: Rs 134.5 per month, down 1.8% from the previous quarter.
- 642 crore GB data consumption in the quarter, up a massive 26.9% from the last quarter.
- 490 crore minutes of VOLTE voice per day, up 18.4% from the previous quarter.
- 340 crore hours per month of video consumption, up a staggering 41.7% from the last quarter.
The company’s strong performance continued to surprise many industry experts as its bitter rivals continued to tumble in the wake of the pricing wars. Last week, market leader, Bharti Airtel has reported a net profit of Rs 97.3 crore in Q1FY19, recording a massive fall of 74% as compared to the same quarter last year Q1FY18. Vodafone India and its soon to be merged entity Idea Cellular, are both expected to report wider losses, according to industry experts.
Most industry players attribute Jio’s strong performance to it ability to hold on to its ARPU. Although Jio’s ARPU did fall in the quarter ending June, it was not only a small dip, but even after the said fall, the ARPU is far higher than it’s biggest rival Airtel. While Airtel posted an ARPU of Rs 105, Vodafone India ARPU’s stood at a distant Rs 102 during the quarter.
Earlier this month, RIL had announced that it will acquire the US-based open telecom solutions provider Radisys Corporation at a valuation of $74 million. Acquiring Radisys is largely seen as an effort to help Jio build in-house development capabilities for fifth-generation (5G) technology and IoT to compete against its rivals in the Indian markets. The Nasdaq-listed Radisys has nearly 600 employees, an engineering team in Bengaluru, along with sales and support offices globally. The deal is expected to close in the fourth quarter of 2018.
Launch of new products
At Reliance’s Annual General Meeting held earlier this month, the company announced a slew of new products and services, including the successor of its super successful JioPhone, dubbed the JioPhone 2. The device, which will be priced at Rs 2999 (introductory price) with a QWERTY keypad, will be releasing on the 15th of August. The company also announced the launch of its fiber-to-the-home (FTTH) service, called Jio Giga-Fibre, also scheduled to start from August 15th. Jio will be supplementing its broadband offering with a suite of smart home products, including smart TV apps, a smart speaker, IoT appliances, and automated doors and doorbells. However, it remains to be seen if the company will bundle these products along with its internet connection or if they will be sold separately. Moreover, the company also did not reveal any tariffs or plans for its FTTH service. However, Jio did announce that the connection speed of the home internet service will be a staggering 1Gbps. Mukesh Ambani said that the service, which will be launched in over 1100 cities this year, is the world’s largest greenfield rollout of a broadband service. The company aims to have 5 crore fiber connections.
Besides, the company also announced at the AGM that, starting August 15th, the company will roll out a software update that will enable YouTube, Facebook and WhatsApp on the 1st generation JioPhones. Speaking at the event, Mukesh Ambani claimed that 25 million JioPhone handsets have been sold so far, at the time. In May, the company also launched a new postpaid plan service for its mobile users, starting at Rs. 199 per month.
The company, at its AGM, also announced a “hybrid online-offline e-commerce platform”, where users will be able to order from nearby stores and Reliance Retail locations. The company said it expects tens of millions of customers and retailers to be a part of this platform through Jio apps as well as Reliance’s own retail ecosystem.