Vodafone Idea posts $700 million loss
Last year, Vodafone (VOD) completed a merger between its Indian subsidiary and its rival Idea Cellular, forming a new operator in India that goes by the name of Vodafone Idea. While the deal helped create the largest mobile operator in India by subscriber, as the Economic Times reported, it has yet to translate into the financial results that Vodafone investors would like to see.
According to a Bloomberg report, Vodafone Idea suffered a loss of about $700 million in the December quarter, marking the second straight quarterly loss for India’s top operator. The business posted a similar-sized loss in the September quarter. In addition to the financial loss, Vodafone’s India subsidiary is also struggling to keep its customers. It lost some 35 million customers during the December quarter, leading to its customer base shrinking to 387.2 million subscribers at the end of the period. Vodafone owns a stake of more than 45% in Vodafone Idea.
Vodafone raising funds for the Indian unit
But Vodafone is not giving up on India despite the headwinds that its subsidiary there continues to face. The company is planning to inject about $3.5 billion into its Indian unit, funds that could go toward supporting investments in a network upgrade to bolster Vodafone Idea’s competitive position.
Vodafone reported a 6.8% YoY decline in revenue to about $12.4 billion in the December quarter. Revenue rose 15.2% YoY at AT&T (T), 6.4% YoY at T-Mobile (TMUS), and 4.4% YoY at Sprint (S) in the December quarter. Verizon’s (VZ) December quarter edged up about 1.0% YoY.