Vodafone Idea Q4 FY26 profit jumps on AGR relief boost

What Vodafone Idea reported for Q4 FY26

Vodafone Idea Ltd (BSE: 532822) reported a consolidated net profit of ₹51,970 crore for Q4 FY26, compared with a net loss of ₹7,167 crore in Q4 FY25. The swing to profit was primarily driven by an exceptional gain linked to the government’s reassessment of adjusted gross revenue (AGR) dues. The company said it recorded a net exceptional gain of ₹57,491 crore in the March 2026 quarter, and another report pegged the exceptional gain at ₹58,116 crore based on the value of future AGR payments.

Operationally, the quarter still showed a loss on a like-to-like basis. Vodafone Idea reported loss before exceptional items and tax of ₹5,515 crore in Q4 FY26, compared with ₹7,167 crore a year earlier and ₹5,286 crore in the previous quarter. The numbers underline that the accounting gain improved reported profitability, while the underlying business remains in a loss-making phase.

AGR dues revision and what changed on the balance sheet

Vodafone Idea said the Department of Telecommunications (DoT) revised the company’s AGR dues down to ₹64,046 crore as of 31 December 2025, from ₹87,695 crore earlier. Repayments are largely deferred to FY32 to FY41, which the company and market participants have seen as improving long-term clarity.

Following the reassessment, Vodafone Idea reduced its Ind AS (Ind AS 109) AGR liability from ₹80,502 crore to ₹24,880 crore, reflecting the present value of future payments. The company said this resulted in an exceptional gain of ₹55,622 crore in FY26. Separately, it is required to pay ₹609 crore in Spectrum Usage Charges (SUC) dues in annual instalments through FY31.

Revenue growth stayed modest

Vodafone Idea’s Q4 FY26 revenue growth was positive but muted. One company update indicated revenue rose 3.2% year-on-year to ₹11,303 crore. Another market report put revenue from operations at ₹11,332 crore, up 2.8% year-on-year. A quarterly table cited total revenue of ₹11,436 crore for March 2026. Taken together, the disclosures point to revenue of around ₹11,300 crore for the quarter with low single-digit year-on-year growth.

For the full year FY26, revenue growth was also incremental. The company reported FY26 revenue of ₹44,789 crore (up 3.1% YoY) in one disclosure, while another report cited revenue from operations of ₹44,873 crore (up 2.9% YoY). Vodafone Idea also reported a FY26 net profit of ₹34,552 crore, compared with a loss of ₹27,383.40 crore in FY25, again influenced by the AGR-related accounting impact.

Costs, EBITDA, and below-the-line items

Total operating expenditure increased 1.4% YoY to ₹6,443 crore in Q4 FY26. Earnings before interest, taxes, depreciation and amortisation (EBITDA) for the quarter was reported at ₹4,889 crore, up 4.9% YoY.

Interest outgo and depreciation in Q4 FY26 were ₹4,990 crore (down 22.9% YoY) and ₹5,518 crore (down 1% YoY) respectively. Vodafone Idea’s management has also flagged that cash EBITDA improvement has been marginal amid significant site rollouts, highlighting the strain that network expansion can place on near-term operating cash flows.

ARPU rose to ₹190, but the peer gap remains

Customer ARPU increased to ₹190 in Q4 FY26 from ₹175 in Q4 FY25, a year-on-year increase of 8.3% (also reported as 8.5% in one account). The company said the rise was primarily supported by customer upgrades and a better 4G/5G subscriber mix.

CEO Abhijit Kishore attributed ARPU growth to improved engagement and rising usage, saying data consumption grew over 30%. He also pointed to the “non-stop hero” proposition offering unlimited data, which saw 25% sequential growth in uptake.

Even with the ARPU improvement, Vodafone Idea continues to lag peers on absolute levels, with one report citing Bharti Airtel at ₹257 and Reliance Jio at ₹214.

Subscriber base: positive adds since February 2026

Vodafone Idea’s total subscriber base stood at 192.8 million in Q4 FY26. The company said monthly subscriber additions turned positive from February 2026.

The 4G/5G subscriber base expanded to 128.9 million, up from 126.4 million a year earlier. Management also highlighted network expansion milestones, including 4G coverage expansion to include a population of over 48 million.

At the same time, the company continues to face structural operating challenges referenced in investor commentary, including high churn versus peers and a lower VLR (Visitor Location Register) subscriber percentage, both of which can impact engagement and retention.

Network rollout: 5G expands beyond 80 cities

Vodafone Idea said its 5G experience is now live in over 80 cities. Management positioned the rollout as part of a broader effort to strengthen network experience and coverage.

Kishore said gains from capex investments and network rollout are “clearly visible” and that Q4 FY26 showed sequential improvement across the company’s seven key internal performance parameters. He emphasised execution focus as the company scales coverage and capacity.

Funding, debt, and promoter support

As of 31 March 2026, bank debt stood at ₹726 crore, down from ₹2,326 crore a year earlier. Vodafone Idea also raised ₹3,300 crore via non-convertible debentures (NCDs) in December 2025. Cash and bank balance stood at ₹3,715 crore as of 31 March 2026.

The promoter group support also featured in the developments, with one report stating Aditya Birla Group committed ₹4,730 crore of capital infusion through Suryaja Investments Pte Ltd, Singapore.

CFO Tejas Mehta said the company aims to increase EBITDA margin from the current 20.5% to over 35% in the coming years. He also outlined that Vodafone Idea plans to meet obligations through a combination of cash EBITDA growth, debt facilities, and promoter equity infusion, and expressed confidence on spectrum payout readiness. Market commentary, however, has continued to flag the challenge of future spectrum payouts and funding strategies beyond FY27.

Market reaction and the key event to watch

Despite the reported profit, Vodafone Idea shares fell on the day, with one update noting the stock down 2.85% to ₹12.59 on the BSE, while another report described a 4% drop. The reaction reflected investor focus on muted revenue growth and the one-time nature of the accounting gain.

A scheduled analyst and investor call on 18 May 2026 at 2:30 PM is expected to provide more detail on operational momentum, capex priorities, and funding plans.

Key numbers snapshot

Why this quarter matters

The quarter created a clear separation between accounting-driven profitability and operating recovery. The AGR relief reduced a major overhang and reshaped the timing of payments, which improves balance-sheet optics and can support lender and investor confidence.

At the same time, the operating story is still about incremental progress. Revenue growth remains modest, and Vodafone Idea needs continued ARPU improvement, churn control, and a stronger active subscriber base to narrow the competitive gap with larger peers.

Conclusion

Vodafone Idea’s Q4 FY26 results marked its first reported profit in years, primarily due to AGR dues relief and a large exceptional gain, while ARPU and 4G/5G subscribers improved. The next clarity point is management’s commentary on execution and funding during the 18 May 2026 investor call, especially around capex rollout and future payout commitments.