Jio Platforms Q2 results: Jio Platforms Q2 results: Net profit up over 23%; ARPU rises but co loses subscribers

Jio Platforms (JPL) net profit rose 23.5 per cent on-year in the July-September quarter, driven by higher data and voice consumption and growing average revenue per user (ARPU). But the company lost mobile phone subscribers for the first time since it started commercial services in September 2016, as many users did not recharge owing to financial difficulties due to the pandemic.

For the fiscal second quarter, JPL’s consolidated net profit stood at Rs 3728 crore compared with Rs 3,651 crore at June end, and Rs 3019 crore a year ago, the company said in a release on Friday.

Quarterly revenue rose to Rs 19,777 crore from Rs 18,952 crore in the April-June period, and Rs 18,496 crore a year ago.

The average revenue per user (ARPU), a key performance parameter, for the telecom business, grew sequentially to Rs 143.6 from Rs 138.4 in the previous quarter, “with improving subscriber mix and increased customer engagement levels,” the company said in a statement.

The company though lost over 11 million subscribers in the just-ended quarter, to end the quarter with 429.5 million users.

“Covid has been tough on those in the bottom of the pyramid…we find a large number of those in the bottom of pyramids have not stayed up to date with recharges,” said Kiran Thomas, President, Reliance Jio Infocomm.

JPL, established in October 2019 as a wholly-owned unit of Reliance, houses the Mukesh Ambani-owned group’s telecom business Reliance Jio Infocomm, the largest in the country, and other digital properties and investments. Reliance Jio though makes up the bulk of JPL’s numbers.

Reliance Jio saw its fiscal second-quarter net profit rise to Rs Rs3,528 crore from Rs3,501 crore in the fiscal first quarter and from Rs2,844 a year ago. Revenue for the telecom market leader rose to Rs 18,735 crore from 17,994 crore in the previous quarter and from Rs 17,481 crore a year ago.

Average wireless data consumption per user per month rose to 17.6 GB from 15.6 GB in the fiscal first quarter. Average voice consumption also rose to 840 minutes per user per month from 818 minutes in the previous quarter.

JPL’s first-quarter earnings before interest, tax, depreciation and amortization (Ebitda) margin was at 47 per cent compared with 46.9 per cent in the first quarter. “Ebitda increased 390 bps Y-o-Y led by IUC (interconnection usage charges) related adjustment and underlying operating leverage in connectivity business,” the company said.

Jio is set to launch JioPhone Next, which it claims will be the world’s most affordable 4G smartphone, in a bid to add more subscribers. It had postponed its launch from September 10 to November around Diwali.