India’s telecom leader, Reliance Jio Platforms Ltd (Jio) — part of the Mukesh Ambani‑led conglomerate — reported a robust quarter for Q2 FY26, registering a 13% year‑on‑year increase in net profit to ₹7,379 crore. Further, the company’s Average Revenue Per User (ARPU) rose to ₹211.4, signalling stronger monetisation of its subscriber base.
In this article, we’ll break down the key numbers, examine the drivers behind the growth, discuss implications for the Indian telecom market, and highlight what to watch going forward.
Key Financial & Operational Highlights
- Net profit reached ₹7,379 crore, up roughly 13% YoY.
- Revenue from operations rose 15% YoY to ₹36,332 crore in the quarter.
- ARPU increased by 8.4% YoY from ₹195.1 to ₹211.4.
- EBITDA stood at around ₹18,757 crore, up about 17.7% YoY; margins expanded ~140 basis points.
- Subscriber base crossed ~506 million users, with 5G users at ~234 million.
What’s Driving the Growth?
Strong ARPU Growth & Monetisation
The increase in ARPU to ₹211.4 reflects effective monetisation of subscribers and higher average usage. Rising data consumption — particularly 5G uptake and home‑broadband services like Jio AirFiber — are lifting revenue per user.
Expanding Services Beyond Mobile
Jio is aggressively scaling its fixed broadband and wireless home internet offerings. For example, the company added over one million new home connections each month in the quarter. This diversification helps reduce reliance purely on mobile plans and opens new revenue pools.
Subscriber Growth & Scale
Adding ~8.3 million new mobile subscribers during the quarter (with churn held at ~1.9%) demonstrates strong demand and retention. Scale continues to be a key competitive asset for Jio in India’s telecom market.
Operational Efficiency & Margin Expansion
The margin expansion (~140 bps) shows that Jio is benefiting from operational leverage, as more users and higher monetisation help spread fixed cost base. Business Standard
Implications for the Indian Telecom Sector
- Leadership reinforced – With over 500 million users, Jio’s scale is daunting for rivals and gives it strong negotiating power with device OEMs and content platforms.
- Data usage is key – The growth story increasingly centres on data consumption rather than voice, signalling a continued shift in telecom business models.
- Price premium opportunities – Rising ARPU means users are willing to pay more for value (5G, broadband, bundled services), opening room for further value‑added services.
- Competitive pressure – Rivals will need to match not just networks but also value‑added services and monetisation strategies to keep pace.
- Investor sentiment – Telecom investors may view Jio as a growth business rather than a commodity operator, which could influence valuations and capital flows.
Challenges & Risks to Monitor
- Tariff regulation & competition – Indian telecom remains subject to regulatory risk; aggressive pricing by competitors could compress ARPU or margins.
- Capex intensity – Rolling out 5G nationwide and expanding broadband/home‑internet services require heavy investment; returns must follow.
- Subscriber churn – Maintaining low churn (~1.9%) is vital; any deterioration could erode ARPU benefits.
- Macro factors – Economic slowdowns or consumer spending softness could impact discretionary levels of data/broadband adoption.
- Technology disruption – New technologies (satellite internet, alternative networks) could alter the competitive landscape.
What To Watch Next
- How ARPU evolves in upcoming quarters — sustained growth would validate the monetisation strategy.
- Growth in non‑mobile revenue streams (home broadband, enterprise, digital services) — these could become meaningful contributors.
- 5G adoption metrics — number of 5G users, data traffic per user, rural vs urban uptake.
- Capex and network rollout pace — how quickly the infrastructure keeps up with demand.
- Competitive moves by other telecom players — any tariff changes or bundled service innovation.
- Regulatory developments in telecom spectrum, price caps, and net‑neutrality frameworks.
Conclusion
Reliance Jio’s Q2 FY26 performance — 13% profit growth to ₹7,379 crore and ARPU climbing to ₹211.4 — underscores its strong position in India’s digital services ecosystem. With scale, monetisation and service diversification in its favour, Jio appears poised to capitalise on the next wave of telecom growth. However, execution remains key: maintaining subscriber growth, increasing ARPU, and managing investment will determine how well it transforms this momentum into sustained value.
