Bharti Airtel Limited — Q2 FY26 earnings call

Call held 4 Nov 2025

Management summary

Bharti Airtel delivered another quarter of consistent performance, driven by strong growth in mobile and broadband segments, disciplined capital allocation, and operational excellence. The company is making significant strides in digital infrastructure, AI integration, and ESG initiatives, while actively addressing regulatory matters like AGR dues and expanding its data center capabilities through Nxtra.

Highlights

  • Consolidated revenues reached approximately ₹52,000 Crores, with an annualized run rate exceeding ₹200,000 Crores.

  • India revenues (excluding Indus) stood at ₹34,900 Crores, and consolidated EBITDAaL margin (excluding passive infra) was 51.5%.

  • Operating free cash flow (EBITDAaL less capex) was strong at approximately ₹10,750 Crores, with capex for the quarter at ₹7,200 Crores.

  • India net debt to EBITDAaL improved to 1.32, reflecting a strong balance sheet.

  • The mobile segment added 1.4 million revenue-earning customers and 1 million postpaid net adds, with ARPU at ₹256.

  • Broadband business saw 951,000 net additions, and the FWA customer base grew to 2.3 million.

  • Digital revenues delivered strong growth of approximately 24% over the last year, and Payments Bank monthly transacting users crossed 104 million.

  • Africa reported constant currency revenue growth of 7.1% sequentially, with EBITDAaL exceeding ₹5,300 Crores and a margin of 38.8%.

Key financials

  1. Consolidated Revenue ₹52,000 Cr
  2. India Revenue (excl. Indus) ₹34,900 Cr
  3. Consolidated EBITDAaL Margin (excl. passive infra) 51.5%
  4. Operating Free Cash Flow ₹10,750 Cr
  5. Capex ₹7,200 Cr
  6. India Net Debt to EBITDAaL 1.32
  7. ARPU ₹256
  8. Digital Revenues Growth 24% +24%YoY
  9. Payments Bank Annualized Run Rate ₹3,200 Cr +19%YoY
  10. Payments Bank Deposits ₹4,000 Cr +35%YoY
  11. Africa EBITDAaL ₹5,300 Cr
  12. Africa EBITDAaL Margin 38.8%
  13. Africa Constant Currency Revenue Growth 7.1% +7.1%QoQ
  14. Africa Reported Revenue Growth 10.7% +10.7%QoQ

What they filed

Q1 FY27: revenue up 18.3%, net profit up 34.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue41,473 45,129 47,876 49,463 52,145 +26%53,982 +20%55,383 +16%58,539 +18%
EBITDA21,846 24,597 27,009 27,839 29,561 +35%30,783 +25%31,492 +17%33,303 +20%
Net profit4,153 16,135 12,476 7,422 8,651 +108%8,503 −47%9,247 −26%10,012 +35%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Bharti Hexacom
    ₹2,317 Cr Revenue₹1,098 Cr EBITDAaL47.5% EBITDAaL Margin28 Mn Revenue Earning Customer Base1,93,000 units Smartphone Customer Additions₹251 ARPU60,000 units Net Customer Addition₹730 Cr Operating Free Cash Generation₹2,814 Cr Net Debt (excl. leases)0.6 Net Debt (excl. FLO) to EBITDAaL

Capital allocation

high confidence
  • Capex ₹7,200 Cr
    • Network expansion (sites and fiber rollout)
    • Nxtra data center investments ₹1,500 Cr
    • Home pass deployment and FWA expansion
    Capex for the quarter was about Rs.7200 Crores. (Gopal Vittal) / Nxtra we have been investing about Rs.1500 Crores a year. (Gopal Vittal) / You will see some amount of elevated capex in the near future because of both going parallelly. (Soumen Ray)
  • Debt 1.3× EBITDA
    India net debt to EBITDAaL now stands at 1.32.
  • M&A Indus Towers Acquisition · Pending regulatory

    Indus is a very clearly undervalued asset, it is a strong dividend-paying Company, it is a vital infrastructure for us.

    Taken an enabling provision to climb by 5% stake.

    On the capital allocation point, I think, for us, we see Indus as a very clearly undervalued asset, it is a strong dividend-paying Company, it is a vital infrastructure for us and therefore, given all of these reasons, we have taken up the stake there, or we have proposed, we have taken an enabling provision to take up the stake there and at some point based on how things play out, we will look to activate that provision.

Guidance & targets

Capacity

  • Nxtra Data Center Capacity Capacity · next few years · High confidence >1 gigawatt
    This is a four-fold increase from our operating capacity currently.

    — Gopal Vittal

Market Size

  • Home Broadband Market Size Market Size · medium term · High confidence ~100 million
    we see the industry growing to about 100 million over the medium term, from currently over 50 million connected homes.

    — Gopal Vittal

Volume

  • Home Pass Run Rate Volume · per quarter · High confidence 2.5 million
    Here, we have stepped up our home pass, to reach 2.5 million homes per quarter run rate.

    — Gopal Vittal

Product Launch

  • Mobile Network 5G Dual Mode Commercial Launch Product Launch · coming months · High confidence commercial launch
    mobile network, pilots are underway for the 5G dual mode in a couple of circles, and we plan to make it commercial in the coming months as the traffic on our 5G network grows.

    — Gopal Vittal

Market Share

  • Home Broadband Market Share Market Share · next three to four years · Medium confidence significant share of incremental net adds
    Our market share aspirations, I do not want to set a target, but I will simply say that we are not happy where we are, the market is consolidating and we think that our ambition would be over the next three to four years, to really step up our performance overall in home broadband so that we get a significant share of those incremental net adds.

    — Gopal Vittal

Industry Growth

  • Home Broadband Industry Growth to 100 million Industry Growth · next five to six years · Medium confidence achieve 100 million
    my own sense is we are today, I think, in the next five to six years, I think we should probably get to it as an industry.

    — Gopal Vittal

What to watch in Q3 FY26

AGR Dues Reconciliation Progress

Next quarter
Current Company planning to reach out to the government for assessment/reassessment of AGR dues up to FY 2016-2017.
Target Update on discussions with the government and any progress on reconciliation.

Why it matters

Resolution of long-standing regulatory liability impacting cash flows and balance sheet.

We are now planning to take up our matter with the government.

Risks & concerns

  • AGR Dues Reconciliation

    medium

    The Supreme Court order permits government to undertake assessment/reassessment of AGR dues up to FY 2016-2017, which the company plans to take up with the government.

    Management acknowledged

  • 5G Monetization Uncertainty

    medium

    Globally, 5G has not lived up to its promise of monetization, primarily offering speed and efficiency rather than new revenue streams.

    Management acknowledged

  • Home Broadband Competitive Pressure

    medium

    While seeing strong growth, competition (e.g., Jio) is also aggressive, and tariffs may need correction after the 'land grab' phase.

    Management acknowledged

  • Seasonality in Digital TV and Hexacom

    low

    Pronounced seasonality impacted customer additions in Digital TV and Bharti Hexacom, leading to a marginal dip in customer base for Hexacom.

    Management acknowledged

Q&A highlights

7 direct
Google Data Center Partnership & Investment Scale Partial
We have not yet guided on this particular issue, but I would again come back to saying that whatever is required to be invested, we will make the investment. I think the numbers that you are talking about are obviously much, much higher than what we think it will be. Suffice it to say that we will do what it takes to step up the growth of Nxtra.

Analyst sought specific investment figures for a key strategic partnership, but management deferred a precise number, indicating it's still being worked out.

Asked by Piyush Choudhary - HSBC

AGR Dues Reconciliation Process Direct
We are now planning to take up our matter with the government.

Clarified the company's next steps following the Supreme Court's order on AGR dues reconciliation, indicating direct engagement with the government.

Asked by Kunal Vohra - BNP Paribas

Home Broadband Capex per Customer Direct
The cost of a connected home between a fiber and an FWA is almost similar, but because the home pass rollout is also becoming aggressive and we are doing more in a quarter, and we are acquiring more customers on FWA, you are seeing for some period, because you are dividing it by the number of customers, and hence you are seeing an elevated number.

Addressed concerns about a perceived spike in home broadband capex per customer, explaining it's a function of aggressive rollout and customer acquisition rather than increased unit costs.

Asked by Sanjesh Jain - ICICI Securities

Indus Towers Stake Increase Rationale Direct
I think, for us, we see Indus as a very clearly undervalued asset, it is a strong dividend-paying Company, it is a vital infrastructure for us and therefore, given all of these reasons, we have taken up the stake there, or we have proposed, we have taken an enabling provision to take up the stake there and at some point based on how things play out, we will look to activate that provision.

Provided clear strategic and financial reasons for increasing stake in Indus Towers, highlighting its undervaluation and strategic importance.

Asked by Sanjesh Jain - ICICI Securities

5G Standalone Capex and Overall Capex Outlook Direct
On 5G standalone, there is really no meaningful capex, because it is all software-led, right? All our networks are capable of moving to standalone at the flick of a button, so it is a very, very tiny amount of money that we spend for software. On homes capex, it is all built into our overall guidance of moderating on capex, so, nothing changes there.

Clarified that 5G standalone rollout is not capex-intensive and overall capex guidance remains unchanged, easing investor concerns about potential increases.

Asked by Ankur Rudra - JP Morgan

Nxtra-Indus Synergies Direct
Nxtra and Indus have really, nothing to do with each other... there is no intention whatsoever of Nxtra being folded into Indus or any such thing.

Firmly dismissed speculation about potential corporate action or synergies between Nxtra and Indus Towers, clarifying their distinct roles.

Asked by Gaurav Malhotra - Axis Capital

Long-Term Subscriber Strategy and Premiumization Direct
I think, for us, Anshuman, it is a balanced approach, so we are constantly looking to see how we can tighten our operations to add more customers onto our network... at a 365 million user base, this is a very wide user base that presents tremendous opportunities for continued premiumization.

Explained the company's strategy of focusing on quality customer acquisition and retention (tenured churn) for premiumization, rather than chasing low-value subscribers.

Asked by Anshuman Atri - Premji Invest

5G Monetization and Future of 6G Direct
one of the pain points in the telecom world across the globe is that 5G has not lived its promise of what it was meant to... for us, chasing technology for the sake of technology is not our obsession, chasing experience and using technology to deliver right customer experience is the obsession.

Provided a candid assessment of 5G monetization challenges globally and reiterated Airtel's focus on customer experience over technology for technology's sake.

Asked by Anshuman Atri - Premji Invest

3 min read 7 chapters

Detailed narrative

Strong Financial Performance and Operational Efficiency

Bharti Airtel reported a robust Q2 FY26 with consolidated revenues of approximately ₹52,000 Crores, translating to an annualized run rate exceeding ₹200,000 Crores. India revenues, excluding Indus, stood at ₹34,900 Crores, with an EBITDAaL margin of 51.5% (excluding passive infra). The company generated strong operating free cash flow of approximately ₹10,750 Crores, while maintaining a healthy India net debt to EBITDAaL ratio of 1.32, reflecting disciplined capital allocation and operational excellence.

Mobile and Broadband Segment Momentum

The mobile segment continued its industry-leading revenue growth, adding 1.4 million revenue-earning customers and 1 million postpaid net adds, bringing ARPU to ₹256. The broadband business also showed sustained growth with 951,000 net additions, and the FWA customer base grew to 2.3 million. Network expansion continued with approximately 2480 new sites and over 10,000 km of fiber rollout during the quarter, contributing to a fiber network spanning over 500,000 kilometers.

Strategic Investments in Digital Infrastructure and AI

Airtel is significantly expanding its data center capabilities through Nxtra, aiming for over 1 gigawatt capacity in the next few years, a four-fold increase from current operating capacity. This includes a partnership with Google to establish a purpose-built data center in Vishakhapatnam, with Nxtra investing approximately ₹1500 Crores annually. The company is also leveraging AI extensively, with an AI-enabled RAN engine optimizing energy usage and an AI-powered anti-spam solution identifying over 57 billion spam calls and reducing financial losses on the network by 69%.

AGR Dues and Regulatory Clarity

Management welcomed the Supreme Court's recent order permitting the government to undertake a comprehensive assessment and reconciliation of AGR dues up to FY 2016-2017. The company plans to engage with the government on this matter in the coming days, seeking resolution for a long-standing industry issue. This move is seen as a positive development, allowing for a more thorough review of past calculations.

Convergence and Customer Experience Focus

Airtel is driving its convergence agenda, with IPTV gaining strong traction and a focus on upgrading 90 million credit-scored potential customers to postpaid services. The company's digital experience layer, powered by a converged data engine, has been extended to Airtel Africa and is being offered as a PaaS service on Airtel Cloud. Opensignal validated Airtel's superior network experience, with the company winning all 5 awards in FWA and 4 out of 5 in FTTH, underscoring its commitment to customer experience.

Bharti Hexacom Performance

Bharti Hexacom delivered a consistent quarter with revenues of ₹2,317 Crores, growing 2.4% sequentially, and an EBITDAaL of ₹1,098 Crores with a 47.5% margin. Despite a marginal sequential dip in the revenue-earning customer base to 28 million due to pronounced seasonality, the company added 193,000 smartphone customers and achieved its highest-ever net customer addition of 60,000 in Q2. ARPU stood at ₹251, and operating free cash generation was strong at ₹730 Crores.

ARPU and Pricing Strategy

Gopal Vittal reiterated that India has the lowest ARPU and cost per gigabyte globally, indicating 'certainly room for more tariff repair.' He expressed a desire for a shift from the current 'one-size-fits-all' pricing architecture to a more tiered structure (small, medium, large, extra large) to enable easier upgradation and better monetization of growing affluence, especially after the current 'land grab' phase in home broadband. This strategic shift is aimed at driving consistent ARPU growth.

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