Bharti Airtel on Tuesday reported a net profit of Rs 829.6 crore for the October-December period, missing Street estimates. The telecom company's quarterly net profit was down 26.8 percent on a year-on-year basis as expenses rose.

A close look into the earnings report shows some pain points.

Mobile user base decline

Airtel lost around 559,000 users in the period. The user base was stagnant with nominal growth in FY22. The mobile subscriber base declined in two out of the last three quarters.

There was a significant churn in mobile subscribers, and about 28 million users left Airtel in the October to December quarter. Of this, 8.7 percent of the total userbase churned out in a single quarter.

Churn hints at a non-premium userbase

Users started leaving as soon as the telecom company announced price hikes in November. User base decline as soon as the firm announced price hike hints at an inferior quality of subscriber base or challenges in monetisation.

Data usage dipped

Users who remained loyal to the telecom company started cutting on data usage. Findings show data usage per customer declined. This also showed that Airtel's userbase has a lot of non-premium users.

DTH base hit

Subscribers churn is not only affecting the telecom base but also impacting the firm's direct-to-home (DTH) business. About 6.3 percent of the total DTH base churned out in the October to December quarter after a 6.6 percent dip in the previous quarter.

Net profit hit

The company's consolidated net profit declined. More than one-fourth of consolidated net profit shaved off on a quarter-on-quarter basis (decline of 27 percent). Analysts in a CNBC-TV18 poll had estimated the company's net profit at Rs 1,220 crore and revenue at Rs 29,900 crore. But the results missed the estimates by a lot.

EBITDA margin hit

Airtel reported Rs 14,905 crore in earnings before interest, taxes, depreciation and amortisation (EBITDA) for the December quarter, down 6.3 percent year on year. Its EBITDA margin came in at 49.9 percent in Q3, as against 49.5 percent in the previous quarter. Analysts had predicted EBITDA at Rs 14,725 crore and EBITDA margin at 49.2 percent.