Bharti Airtel, India’s second-largest telecom operator, reported a flat Average Revenue Per User (ARPU) of ₹245 for Q4 FY25, unchanged from the previous quarter. This stagnation signals a setback in the company’s push to attract more premium users—a key part of its strategy to improve profitability. Despite adding 0.6 million postpaid users and 6.6 million smartphone data consumers, the ARPU did not reflect any upward momentum. This suggests that the impact of the July 2024 tariff hike may have fully played out.
Airtel’s ARPU Holds Strong, But Tariff Hike Uncertainty Looms
Airtel continues to lead the industry in ARPU, with rival Reliance Jio trailing at ₹206.2. However, Jio’s ARPU showed some improvement during the same period, indicating that its strategy may be delivering better returns at present. All eyes are now on Vodafone Idea (Vi) to see if it can make any significant changes in this area.
With its reputation for offering premium services and a larger base of 4G users, Airtel still commands higher ARPU than Vi. However, the question remains whether Airtel will consider another round of tariff hikes to boost revenue. Telecom companies, including Airtel, have long argued for the need to increase tariffs to improve financial returns. Crisil projects that the industry’s return on capital employed (ROCE) could reach 12% this fiscal year, but telcos remain cautious about sustainable profitability.
Airtel Awaits Industry Consensus for Next Tariff Hike Amid ARPU Stagnation
Future tariff hikes could be on the horizon if ARPU growth continues to stall across the industry. However, Airtel is unlikely to initiate price increases alone, as doing so without coordination could risk losing customers to competitors. Therefore, any new hike will likely be a joint move with other major telecom players.
Currently, there is no confirmed timeline for the next price hike—it will depend on market dynamics and how operators gauge customer response and financial performance.
Summary:
Bharti Airtel’s ARPU remained flat at ₹245 in Q4 FY25, indicating limited gains from premium user additions. Despite strong user growth, tariff hike impacts appear exhausted. With Jio showing ARPU improvement, future hikes may depend on industry-wide coordination. Airtel awaits market cues for timing further price adjustments.
