Bharti Airtel Ltd is pulling back on its fixed wireless access (FWA) expansion, pivoting back to fibre broadband as rising hardware costs and weak customer retention weigh on the economics of 5G-based home broadband.

The shift comes even as rival Reliance Jio continues to expand its AirFiber business. Airtel executives said higher memory and chipset costs have hurt FWA economics, while low entry-level pricing attracted customers who were less likely to stay with the service, prompting the company to tighten customer acquisition and deploy FWA only where fibre is not viable.

“While low entry-level pricing helped attract customers, the outcomes were not consistent with the quality of customers…with a higher churn and weaker continuity in certain cohorts,” Shashwat Sharma, managing director and chief executive of Airtel India, told analysts on the company's Q1 earnings call on Wednesday.

Sharma added that rising global memory and chipset prices have also hurt FWA economics. “We have responded to this with discipline. We have tightened acquisition quality, doubled down on improving our churn and driving towards a healthier business outcome.”

FWA delivers home broadband over 5G networks instead of fibre-optic cables and has been widely viewed as one of the telecom industry's key avenues to monetize heavy 5G investments. Airtel has consistently maintained that fibre remains its preferred broadband technology even as it built an FWA base.

Fibre back in focus

Gopal Vittal, executive vice chairman of Bharti Airtel, said execution challenges have reinforced that preference.

“On the fixed wireless access, there are two challenges - one is installing it in the wrong place actually leads to problems, so you will have poor experience,” Vittal said during the earnings call.

“Installing it with poor quality of acquisition leads to a double whammy because now you have to run around collecting that box back rather than actually like putting it in the right place and sustaining the business,” Vittal said, adding that Airtel will deploy FWA only where fibre is unavailable.

Airtel added 473,000 home broadband customers during the April-June quarter, down sharply from 1.1 million in the preceding quarter. As of June-end, its home broadband base stood at 14.7 million.

In comparison, Reliance Jio ended June with 28.6 million fixed broadband subscribers, including more than 14 million AirFiber users.

According to Vittal, nearly 95% of India's home broadband market is concentrated in 400 cities, where Airtel is accelerating fibre expansion to gain market share.

Strong quarter

The broadband strategy shift came alongside a strong June-quarter performance (Q1FY27), driven by growth in its premium mobile user base, Africa business, enterprise business and home business.

Despite no tariff increase, Airtel's average revenue per user (Arpu) rose 2.7% sequentially to ₹264 a month from ₹257.

“On mobile Arpu, we see substantial headroom within the current customer base itself. There's enough upgrade that's happening, which is driven by consumption of data moving to unlimited plans as well as an acceleration on postpaid with differentiation that we have brought with fastlane technology,” Sharma said.

He added that Airtel sees room to sustain Arpu growth over the medium term. Over the longer term, the company reiterated that tariff architecture will need to be reworked through differentiated pricing tiers based on data consumption.

According to Vittal, such changes could support sustained Arpu growth of 4-5% annually over the next five to seven years without raising entry-level tariffs.

For the June quarter, Airtel's consolidated revenue from operations rose 18.4% year-on-year to ₹58,539 crore, ahead of Bloomberg's estimate of ₹56,896 crore. Net profit increased 37.3% to ₹8,167 crore but missed the consensus estimate of ₹8,699 crore.

Africa contributed 30% of Airtel's total revenue during the quarter.

Vittal said the Africa business has delivered a constant-currency compound annual growth rate of more than 20% in revenue and over 24% in Ebitda over the past five years. He cited low tele-density of 45%, smartphone penetration of 52% and the opportunity to deepen financial inclusion through Airtel Money as key growth drivers.

Airtel Money is preparing for a listing on the London Stock Exchange in the second half of 2026, Vittal said.

Bharti Airtel Ltd is pulling back on its fixed wireless access (FWA) expansion, pivoting back to fibre broadband as rising hardware costs and weak customer retention weigh on the economics of 5G-based home broadband.

The shift comes even as rival Reliance Jio continues to expand its AirFiber business. Airtel executives said higher memory and chipset costs have hurt FWA economics, while low entry-level pricing attracted customers who were less likely to stay with the service, prompting the company to tighten customer acquisition and deploy FWA only where fibre is not viable.

“While low entry-level pricing helped attract customers, the outcomes were not consistent with the quality of customers…with a higher churn and weaker continuity in certain cohorts,” Shashwat Sharma, managing director and chief executive of Airtel India, told analysts on the company's Q1 earnings call on Wednesday.

Sharma added that rising global memory and chipset prices have also hurt FWA economics. “We have responded to this with discipline. We have tightened acquisition quality, doubled down on improving our churn and driving towards a healthier business outcome.”

FWA delivers home broadband over 5G networks instead of fibre-optic cables and has been widely viewed as one of the telecom industry's key avenues to monetize heavy 5G investments. Airtel has consistently maintained that fibre remains its preferred broadband technology even as it built an FWA base.

Fibre back in focus

Gopal Vittal, executive vice chairman of Bharti Airtel, said execution challenges have reinforced that preference.

“On the fixed wireless access, there are two challenges - one is installing it in the wrong place actually leads to problems, so you will have poor experience,” Vittal said during the earnings call.

“Installing it with poor quality of acquisition leads to a double whammy because now you have to run around collecting that box back rather than actually like putting it in the right place and sustaining the business,” Vittal said, adding that Airtel will deploy FWA only where fibre is unavailable.

Airtel added 473,000 home broadband customers during the April-June quarter, down sharply from 1.1 million in the preceding quarter. As of June-end, its home broadband base stood at 14.7 million.

In comparison, Reliance Jio ended June with 28.6 million fixed broadband subscribers, including more than 14 million AirFiber users.

According to Vittal, nearly 95% of India's home broadband market is concentrated in 400 cities, where Airtel is accelerating fibre expansion to gain market share.

Strong quarter

The broadband strategy shift came alongside a strong June-quarter performance (Q1FY27), driven by growth in its premium mobile user base, Africa business, enterprise business and home business.

Despite no tariff increase, Airtel's average revenue per user (Arpu) rose 2.7% sequentially to ₹264 a month from ₹257.

“On mobile Arpu, we see substantial headroom within the current customer base itself. There's enough upgrade that's happening, which is driven by consumption of data moving to unlimited plans as well as an acceleration on postpaid with differentiation that we have brought with fastlane technology,” Sharma said.

He added that Airtel sees room to sustain Arpu growth over the medium term. Over the longer term, the company reiterated that tariff architecture will need to be reworked through differentiated pricing tiers based on data consumption.

According to Vittal, such changes could support sustained Arpu growth of 4-5% annually over the next five to seven years without raising entry-level tariffs.

For the June quarter, Airtel's consolidated revenue from operations rose 18.4% year-on-year to ₹58,539 crore, ahead of Bloomberg's estimate of ₹56,896 crore. Net profit increased 37.3% to ₹8,167 crore but missed the consensus estimate of ₹8,699 crore.

Africa contributed 30% of Airtel's total revenue during the quarter.

Vittal said the Africa business has delivered a constant-currency compound annual growth rate of more than 20% in revenue and over 24% in Ebitda over the past five years. He cited low tele-density of 45%, smartphone penetration of 52% and the opportunity to deepen financial inclusion through Airtel Money as key growth drivers.

Airtel Money is preparing for a listing on the London Stock Exchange in the second half of 2026, Vittal said.