Jazz, a leading telecom company in Pakistan, reports a decrease in revenue despite growth in local currency
Jazz, a telecom company in Pakistan, experienced a decrease in revenue by 2.6% in USD terms during the fourth quarter of 2022, despite a 24.3% YoY growth in overall revenues in local currency. This was mainly due to the devaluation of the Pakistani Rupee and an exponential increase in operational costs, such as fuel, electricity, interest rate, and forex. The company’s margins were affected by this increase in operational costs. However, a one-time effect to the reversal of a provision offset the 71% YoY increase in fuel prices and 53% YoY increase in electricity prices.
Jazz invests in digital inclusion and enhances quality of services for customers
Despite macroeconomic challenges, Jazz continued to lead the market with its focus on driving digital inclusion while enhancing quality of services for its customers. It invested over PKR 52 billion under its ‘4G for all’ ambition in FY22, taking its overall investment in Pakistan to US$10.4 billion. Jazz’s total mobile subscriber base reached 73.7 million during the reporting period, with 41.3 million 4G users and 10 million Voice-over-LTE (VoLTE) users. The company’s digital services, including JazzCash, Jazz World, and Tamasha, also performed well during the quarter, with strong customer adoption levels.
Jazz CEO acknowledges increase in operating costs and restrictions on importing essential telecom equipment in Pakistan
Aamir Ibrahim, CEO of Jazz, acknowledged the unprecedented increase in operating costs and restrictions on importing essential telecom equipment in Pakistan. He said that Jazz is making an all-out effort to optimize and enrich customer experience through consistent network investments and its robust digital services portfolio. The company’s commitment to offering the best-in-class services to its customers has been validated by higher user engagement in digital services and recognition of Jazz as the fastest mobile broadband provider in Pakistan.
Jazz aims to mitigate the impact of rising costs and maintain growth
However, the weakening Pakistani Rupee against the dollar makes telecom equipment more expensive, and the rising interest rates are making financing twice as expensive. In this scenario, the average revenue per user must rise from the current lowest in the world, at $0.75, to at least $1.5 in the next 12 months to ensure consistent improvement in the quality of services. Jazz plans to take disciplined inflationary pricing to help mitigate this digital emergency and maintain an accelerated growth mindset.