Telkom Indonesia Q1 2016 results: Data the main revenue driver

By Masyitha Baziad April 26, 2016

Data, Internet, and IT services revenue grew 45.1%
Targeting 15% increase in revenue for 2016

Telkom Indonesia Q1 2016 results: Data the main revenue driver

INDONESIA’s largest telco service provider PT Telekomunikasi Indonesia Tbk (Telkom) recorded a 16.6% increase in revenue to Rp27.54 trillion (US$2.1 billion) in the first quarter (Q1) of 2016 versus Rp23.62 trillion (US$1.8 billion) in the same period last year, thanks to its data and Internet business.

Earnings before interest, tax, depreciation and amortisation (EBITDA) increased 18.8% to Rp14.66 trillion (US$1.1 billion), while net profit surged 20.26% to Rp4.59 trillion (US$350 million).

Increased smartphone adoption in Indonesia saw surging customer demand for data services, leading to Telkom posting a significant 45.1% increase in data, Internet, and IT service (excluding SMS) revenue to Rp10.3 trillion (US$780 million) versus Rp7.1 trillion (US$540 million) in Q1 2015.

Despite rumours of its death, short messaging services (SMS) held on, with revenue growing 15.4% to Rp3.95 trillion (US$300 million), bringing total data revenue to Rp14.26 trillion (US$1.1 billion).

“The data, Internet, and IT services segment contributed 37.4% to our total revenue – this is the first time in our history that this segment contributed more than 35% of our total revenue,” Telkom president director Alex J. Sinaga (pic above) said in an official statement.

He said that the company’s investments in broadband infrastructure has finally paid off, as did its subsidiary Telkomsel expanding its 4G LTE (Fourth Generation/ Long-Term Evolution) network.

Telkom’s data segment has been growing rapidly since 2010, but had previously been overshadowed by its cellular and fixed-line revenue.

But as of Q1 2016, its data revenue (excluding SMS) has almost caught up with cellular and fixed-line revenue, which grew only 3.34% to Rp10.87 trillion (US$830 million), from Rp10.52 trillion (US$800 million) in the same period last year.

Cellular voice revenue grew 5.04% to Rp8.92 trillion in Q1 2016 versus Rp8.5 trillion in Q1 2015, but fixed voice revenue declined 3.8% to Rp1.94 trillion this quarter versus Rp2.02 trillion a year ago.

As of Q1 2016, Telkom had 43.8 million subscribers for its Telkomsel Flash mobile broadband service, and 4.2 million subscribers for its IndiHome Fiber fixed broadband service.

For fiscal 2016, the company is targeting a 15% increase in full year revenue to Rp115 trillion (US$8.7 billion) versus the Rp102.5 trillion it recorded in 2015.