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Reliance Jio’s net profit soars to Rs 990 crore, growing 45% YoY

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Reliance Jio reported a net profit of Rs 990 crore in Q2FY20 ⁠— up about 45.3% from Q2FY19 when it posted a net profit of Rs 681 crore. In comparison, Jio’s biggest rivals Bharti Airtel and Vodafone Idea posted a combined loss of about Rs 74,000 crore, making Jio the only profitable telecom company this quarter among the country’s top 3 telcos. Compared to the last quarter, Jio’s net profit increased by 11%.

While the Supreme Court’s recent verdict on the payment of Adjusted Gross Revenue hit Bharti Airtel and Vodafone Idea the most, Jio, which began operations in late 2016, was the least affected because it only had to pay Rs 14.5 crores in charges to clear. When the Cellular Operators Association of India (COAI) wrote to the Department of Telecommunications last month, seeking its intervention in the SC judgement that ordered telecom companies to  pay Rs 92,640 crores to the Centre, Jio criticised it. It said that Airtel and Vodafone’s financial difficulties were their own doing and an effect of their own commercial decisions.

ARPU falls, but subscribers increase: Operational figures

  • Revenue for the quarter was Rs 12,354 crore as it grew 5.8% from Rs 11,679 crore in the last quarter.
    • Jio’s revenue is less than Bharti Airtel’s (Rs 21,131 crore), and more than Vodafone Idea’s (Rs 10,840 crore).
  • Average Revenue Per User (ARPU) remained a worrying statistic for Jio as it fell to Rs 120 this quarter from Rs 122 in the previous quarter. In the same quarter last year, Jio had reported ARPU of Rs 131.7.
    • Bharti Airtel reported a higher ARPU at Rs 128, while Vodafone Idea’s ARPU stood at Rs 107 this quarter.
  • The company added 24 million subscribers, a 7.2% increase over the previous quarter, taking its total subscribers to 355.2 million for the quarter.
    • Bharti Airtel had 304.7 million subscribers after it lost about 47 million subscribers and Vodafone Idea had 311.1 million subscribers after losing about 9 million subscribers this quarter.
  • Wireless data consumption on the network increased 10.3% from the last quarter and stood at 1,202 GB per month, while the per user data consumption increased marginally QoQ from 11.4 GB/month to 11.7 GB/month.
  • Access charge, or the Interconnect Usage Charge (IUC), fell to Rs 655 crore this quarter, as opposed to Rs 851 crore in the last quarter.
    • Jio had started charging its customers 6 paise per minute for mobile voice calls made to other operators in early October.
  • Voice consumption per user fell to 789 minutes per month from 821 minutes per month in the previous quarter.

Please note that Jio announced its earnings for the quarter on October 18, a few days before the SC’s AGR ruling which happened on October 24. As a result, the impact of the verdict is not reflected in its earnings for the quarter. 

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