PT Telkom profit falls 14% in Q1
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Indonesia’s PT Telkom has reported a 14% decline in first quarter profit to 5.73 trillion rupiah ($410.8 million), partly as a result of stricter competition.
Revenue for the quarter grew 4.3% to 32.3 trillion rupiah, but tighter competition and the ongoing decline in revenue from legacy voice and SMS revenue impeded further growth.
Data, internet and IT services revenue by comparison grew a strong 23.3% to 15.9 trillion rupiah due to increasing demand as a result of the growing use of smartphones.
Mobile broadband subscribers grew 21.3% to 108.73 million subscribers, with mobile subsidiary Telkomsel reporting a net profit of 6.4 trillion rupiah and revenue of 21.9 trillion rupiah.
On the fixed line front, consumer broadband revenue grew to 3.1 billion rupees with enterprise revenue increasing to 8.63 trillion rupees. Subscribers to Telkom’s IndiHome fiber broadband service nearly doubled to 5.74 million.
Telkom’s capex for the quarter reached 6.13 trillion rupees, up from 6.06 trillion the year earlier, the report adds.
The funds were primarily used to finance the construction of new base stations, expand access network and backbone infrastructure and develop the operator’s Sea Cable Communication System that supports its fixed and mobile broadband businesses.
Questions & Answers
Q.What are the primary reasons cited for the 14% decline in PT Telkom's first quarter profit?
What are the primary reasons cited for the 14% decline in PT Telkom's first quarter profit?
The decline in profit is attributed partly to stricter competition in the market. Also, the ongoing reduction in revenue from traditional voice and SMS services hindered further growth for the company.
Q.Which specific segments are showing strong growth for PT Telkom?
Which specific segments are showing strong growth for PT Telkom?
Data, internet, and IT services revenue experienced significant growth, increasing by 23.3%. This rise is driven by increasing demand, largely due to the widespread use of smartphones among consumers.
Q.How did PT Telkom's capital expenditure for the first quarter compare to the previous year?
How did PT Telkom's capital expenditure for the first quarter compare to the previous year?
Capital expenditure for the quarter reached 6.13 trillion rupees, which is an increase from the 6.06 trillion spent in the same period last year. These funds supported network and infrastructure development.
Q.What proportion of PT Telkom's total revenue was generated by its mobile subsidiary, Telkomsel?
What proportion of PT Telkom's total revenue was generated by its mobile subsidiary, Telkomsel?
Telkomsel, the mobile subsidiary, contributed 21.9 trillion rupiah to the company's revenue. This represents a significant portion of PT Telkom's total revenue of 32.3 trillion rupiah for the quarter.
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