Vodafone Idea Q1 Results Highlights: Net Loss to ₹6,432 Cr, Cuts Debt in Half

Vodafone Idea (Vi) posted a net loss of ₹6,432 crore for the first quarter (Q1) of the 2024-25 fiscal year (FY25). Compared to the previous quarter, the company's net loss decreased by 16.1%. Interest and finance costs fell to ₹5,262 crore in Q1, marking a 17.6% reduction. Meanwhile, the company's revenue from operations experienced a slight decline of 1.38% in the same period. 

Vodafone Idea Q1 Results Highlights

On Monday, Vodafone Idea (Vi) reported a net loss of ₹6,432 crore for the first quarter (Q1) of the 2024-25 fiscal year (FY25), which represents a decrease of nearly 18% compared to the ₹7,840 crore loss recorded in the same quarter of 2023-24 (FY24). This reduction is largely attributed to lower interest and financing costs. Sequentially, the company's net loss also declined by 16.1%, down from ₹7,675 crore in the previous quarter.

Vodafone Idea share price ended the day at ₹16.01, reflecting a decrease of 0.62% from the previous day's ₹16.11. 

The telecom company's interest and finance expenses dropped to ₹5,262 crore in Q1, reflecting a 17.6% decrease from ₹6,376 crore in the same period of the previous year. However, the company's revenue from operations saw a slight decline of 1.38% in the latest quarter, amounting to ₹10,508 crore, down from ₹10,655.5 crore in Q1FY24.

The average revenue per user (ARPU) for the quarter remained steady at ₹146, the same as in the fourth quarter (Q4). For comparison, ARPU was ₹145, ₹142, and ₹139 in the first three quarters of the previous fiscal year, respectively. On a year-over-year basis, ARPU increased by 4.5%.

Q4 marked the twelfth consecutive quarter of 4G subscriber growth for the company. The 4G subscriber base grew to 126.7 million, a slight increase of 0.3% from 126.3 million in the previous quarter. However, the company continued to lose customers to larger competitors, Reliance Jio and Bharti Airtel, ending Q1 with 2.5 million fewer subscribers. This figure is slightly lower than the 2.6 million subscribers lost in the preceding quarter, and the rate of churn continues to decrease, particularly when compared to the 4.6 million users lost in the third quarter of FY24.

By the end of Q1, Vodafone Idea's total payment obligations to the government stood at ₹2.09 trillion, including deferred spectrum payment obligations of ₹1.39 trillion and an adjusted gross revenue liability of ₹70,320 crore.

In a significant relief for the company, its debt to banks and financial institutions was reduced to ₹4,650 crore in Q1, down from ₹9,200 crore a year earlier.

Vodafone Idea Management Commentary

"Following the recent equity raise, we are currently working on expanding our 4G coverage and capacity, as well as launching 5G services. Some capital expenditure (capex) has already been ordered and is under execution, which we anticipate will lead to a 15% increase in our data capacity and an expansion in 4G population coverage by 16 million by the end of September 2024," stated Chief Executive Officer Akshaya Moondra.

Moondra also mentioned that the company is actively engaging with lenders to secure debt funding for the execution of its network expansion plan, with a planned capex of ₹50,000-55,000 crore over the next three years.

About Vodafone Idea Ltd

Vodafone Idea Ltd (VI), previously known as Idea Cellular Ltd, is a telecommunications service provider. The company offers a range of services, including mobile connectivity, broadband, and passive infrastructure. Its offerings include 2G, 3G, 4G, and 5G wireless services, along with high-speed broadband.

The company offers enterprise services, digital solutions, content services, and IoT solutions to various sectors, including the public sector, government, small and medium enterprises, and start-ups. It serves customers across India. VI is headquartered in Mumbai, Maharashtra, India.