Vodafone Idea (Vi) has reported a measured but encouraging performance for the quarter ended September 2025 (Q2 FY26) on 10th November 2025, showing that tariff-driven improvement and broadband upgrades are helping it slowly stabilise operations.
The debt-laden player in the telecom service sector reduced its consolidated net loss to ₹5,524 crore in Q2 FY26, compared to ₹7,175.9 crore in the same quarter last year, reflecting better operating performance and stronger realisations per user. At the same time, revenue from operations grew 2.4% year-on-year to ₹11,195 crore, backed by higher ARPU and increased 4G/5G subscriber engagement.
This quarter also saw the company reiterate its strategic focus on expanding 4G population coverage, scaling its 5G rollout in revenue-contributing circles, and working with lenders to support a capex plan of ₹500–550 billion.
Key Q2 FY26 Highlights
- Net loss narrowed: ₹5,524 crore vs ₹7,175.9 crore in Q2 FY25.
- Revenue growth: Up 2.4% YoY to ₹11,195 crore.
- ARPU (ex-M2M): Up to ₹180 from ₹166 a year ago — an 8.7% YoY rise, helped by customer upgrades and tariff pass-through.
- EBITDA: ₹4,685 crore vs ₹4,550 crore last year; EBITDA margin improved to 41.9% from 41.6%.
- Cash EBITDA (pre-Ind AS 116): ₹2,246 crore vs ₹2,324 crore in Q2 FY25.
- 4G/5G subscribers: 127.8 million vs 125.9 million in Q2 FY25; total subscriber base stood at 196.7 million.
- 4G coverage: Expanded to over 84% of the population, with 4G data capacity up 38% and 4G speeds up 17% versus March 2024.
- 5G rollout: Completed in all 17 circles where Vi holds 5G spectrum; Vi 5G services are now available in 29 cities.
- Capex: ₹1,750 crore in the quarter; ₹4,200 crore in H1 FY26.
- Bank debt: Reduced to ₹15.3 billion (₹1,530 crore approx.) as of 30 September 2025.
- Total debt: ₹2,02,951 crore at the end of the quarter.
- Regulatory update: The company welcomed the Supreme Court’s October 27 and November 3, 2025, judgments on AGR reassessment and is in discussions with the DoT on next steps.
ARPU Growth Is Doing the Heavy Lifting
For a telecom operator in a consolidation phase, ARPU is the single most important operating lever — and Vodafone Idea’s numbers underline that. ARPU rose to ₹180 in Q2 FY26 from ₹166 in Q2 FY25, an increase of 8.7%. The company indicated that this was largely due to customer upgrades, tariff improvements and stronger broadband usage.
Higher ARPU, even on a relatively flat subscriber base, helped lift revenue by 2.4% YoY and supported the improvement in reported EBITDA to ₹4,685 crore. The EBITDA margin ticked up by 30 bps to 41.9%, showing that the company is managing operating costs even as it invests in 4G and 5G sites.
Network Strengthening: 4G to 90% Is the Next Milestone
Management highlighted that Vodafone Idea “continues to make steady progress” towards delivering a better customer experience. The company:
- Took 4G population coverage to over 84% as of September 2025, up sharply from about 77% in March 2024.
- Increased 4G data capacity by over 38%, which in turn drove a 17% improvement in 4G speeds versus March 2024.
- Added 1,500+ new unique 4G towers during the quarter.
- Deployed around 3,200 new sites on the 900 MHz band across 16 circles and 3,600+ sites on 1800 MHz and 2100 MHz bands to improve indoor coverage and speeds.
- Took total broadband site count to ~527,000.
- Rolled out 13,000+ Massive MIMO sites and 12,400+ small cells.
On 5G, the company said it has completed rollout in all 17 priority circles — these circles account for nearly 99% of its revenue — and Vi 5G services are now present in 29 cities. Further 5G expansion will be calibrated on the basis of customer demand and 5G handset penetration.
The stated internal target is to increase 4G coverage to about 90% of the population, which will require continued capex — hence the ongoing engagement with lenders.
Capex and Funding: Engagement with Lenders Continues
Vodafone Idea spent ₹1,750 crore in capex during the quarter and ₹4,200 crore in the first half of FY26. The CEO reiterated that the company “remains engaged with lenders to secure debt financing to support our broader capex plans of ₹500–550 billion.” This indicates that the company wants to keep investing in capacity, coverage and 5G, even as it works through its balance-sheet challenges.
As of 30 September 2025:
- Debt from banks declined to ₹15.3 billion.
- Cash and bank balance stood at ₹30.8 billion (as per the result-day updates).
- Total debt was reported at ₹2,02,951 crore.
While the debt level remains high, the reduction in bank debt and positive operating metrics give the company more room to negotiate future funding linked to network expansion.
AGR Dues: A Positive Opening
A key disclosure in this quarter was Vodafone Idea’s reaction to the Supreme Court’s judgements dated 27 October 2025 and 3 November 2025. The apex court has permitted the Union government to reconsider and take an appropriate decision on the additional AGR demand raised for the period up to FY 2016–17, including interest and penalty.
Vodafone Idea said it has welcomed the order and is in discussion with the Department of Telecommunications (DoT) on the next steps. For a company dealing with legacy regulatory liabilities, even the possibility of reassessment is constructive and supports the management’s forward-looking tone.
What the Management Said
CEO Abhijit Kishore underlined that the company is focused on retaining and engaging customers through differentiated prepaid and postpaid offerings, which is reflected in a ~21% growth in data volume. He also said:
- Vi has completed 5G rollout in all circles where it holds spectrum.
- The company will expand 5G further in geographies where 5G handset adoption is rising.
- The investment journey to deliver superior customer experience will continue, backed by funding efforts with lenders.
This management commentary aligns with the operating numbers — slower losses, better ARPU, more broadband sites and a clear network roadmap.
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Conclusion
Vodafone Idea’s Q2 FY26 performance shows measurable operational progress in a challenging environment. The company:
- Narrowed its net loss significantly,
- Grew revenue in low single digits,
- Improved ARPU meaningfully,
- Expanded 4G and continued 5G rollouts in high-revenue circles,
- And received a constructive opening on the AGR front.
At the same time, the business still carries a large debt burden of ₹2,02,951 crore and will have to secure additional financing to meet its capex ambitions of ₹500–550 billion. However, the combination of higher ARPU, improving network metrics, broader broadband coverage and a positive regulatory development gives this quarter a distinctly improving tone — consistent with a sentiment in the green zone.
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