Nepal Telecom’s Financial Statement Shows Significant Decline in Earnings

Nepal Telecom Financial Decline

17th November 2025, Kathmandu

Nepal Telecom (NTC) has published the summary of its unaudited financial statement for the first quarter of the fiscal year 2082/83.

Nepal Telecom Financial Decline

The report indicates a significant fall in both the company’s revenue and net profit compared to the corresponding period of the previous year.

This substantial Nepal Telecom Financial Decline OTT Services Impact NTC earnings, posing a serious challenge to the state-owned telecom operator.

Total Revenue Drops by 5.89%

For this first quarter, the company’s total income stood at NPR 9.47 billion. This marks a 5.89 percent decrease, or NPR 592.68 million, compared to the NPR 10.06 billion recorded during the same period last year.

The decline in total revenue clearly reflects growing market pressures. However, the report noted a negligible decrease of only 0.01 percent in total operating income.

Net Profit Takes a 23.82% Hit

The company’s profitability has suffered a major setback. The net profit for this quarter was only NPR 1.32 billion, a stark contrast to the NPR 1.73 billion recorded last year.

This translates to a massive 23.82 percent drop in net profit. Similarly, Profit Before Tax (PBT) decreased by 18.90 percent, settling at NPR 2.88 billion.

The Annualized Earnings Per Share (EPS) for the first quarter of the current fiscal year is NPR 29.45. The sharp drop in net profit is a key indicator of the Nepal Telecom Financial Decline.

Key Drivers Behind the Financial Shift

The significant changes observed in revenue and net profit are primarily attributed to two major factors. The widespread use of Over-The-Top (OTT) services is heavily impacting the volume of incoming international calls.

This OTT Services Impact NTC earnings significantly. Consequently, the interconnect revenue saw a 17.29 percent drop, equivalent to approximately NPR 109.74 million. This indicates a structural challenge to NTC’s traditional sources of income.

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Another major reason for the downturn is the decline in market interest rates. This led to a substantial 49 percent reduction in interest income derived from fixed deposits, resulting in a drop of up to NPR 500 million in interest earnings.

Increasing Operational Costs

While earnings have fallen, the company’s expenditure on personnel has increased, amplifying the financial pressure.

• Employee Insurance: Employee insurance expenses increased by NPR 19.5 million.

• Pension Liability: Employee retirement-related costs rose by NPR 165 million. This increase resulted from a change in the discount rate used to calculate pension plan liabilities (from 7.5% to 7%) as per Nepal Accounting Standard (NAS) 19.

• Total Personnel Cost: These factors combined led to a total increase of NPR 88 million in overall employee expenses.

NTC stated that, being the nation’s communication provider, it continually expands services and improves quality in remote and challenging areas.

Such initiatives often involve high costs and yield lower returns, contributing to the elevated overall operating expenditure. This commitment further complicates the effort to mitigate the Nepal Telecom Financial Decline.

Strategic Outlook

This quarterly report highlights the urgent need for NTC to adapt its business model. The growing OTT Services Impact NTC profitability, demanding a swift pivot towards innovative digital services and data-centric revenue streams.

Financial restructuring and stringent cost control measures are now paramount for NTC to ensure long-term stability in the rapidly evolving ICT sector.

For more: Nepal Telecom Financial Decline