Tata Communications reported a consolidated net profit of Rs 227.23 crore for Q2 of 2024-25, representing a 3% increase from Rs 220.66 crore in the same quarter last year. However, this marked a 32% decline compared to the Rs 332.84 crore profit in Q1FY25.
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The company’s income from operations rose 18% year-on-year to Rs 5,767.35 crore, compared to Rs 4,872.50 crore in Q2FY24. Sequentially, revenue increased by 2.4% from Rs 5,633.37 crore in the previous quarter. Following the earnings announcement, Tata Communications shares dropped over 4%, reaching a low of Rs 1,840 on the NSE.
Total expenses for the July-September quarter surged to Rs 5,503.47 crore, up 20% from Rs 4,599.59 crore in Q2FY24, and increased from Rs 5,328.73 crore in Q1FY25. The voice solutions segment saw revenue decline slightly to Rs 425.48 crore, while the Data Services segment reported a strong revenue increase to Rs 4,854.42 crore, up from Rs 4,007.15 crore a year earlier.
The Transformation Services segment’s revenue fell to Rs 286.38 crore from Rs 384.54 crore in Q2FY24. In contrast, the Campaign Registry segment showed growth, with revenue rising to Rs 158.44 crore in Q2FY25 from Rs 145.44 crore in Q1FY25.
In December 2023, the Supreme Court of India ruled on the treatment of Variable License Fees paid to the Department of Telecommunications under the New Telecom Policy 1999, stating that these fees should be considered capital expenses for tax calculations. The company recorded an exceptional provision of Rs 185.52 crore for interest and an additional Rs 21.09 crore for tax adjustments due to the new tax regime’s effective rate changes
