du posts 15.5% profit growth in Q1 despite March slowdown linked to regional tensions

Dubai: Emirates Integrated Telecommunications Company (du) reported a strong set of first-quarter results for 2026, with revenue and profit growth supported by solid performance in the early part of the year, despite a slowdown in March linked to regional geopolitical developments.

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The company said revenue rose 6.9% year-on-year to Dh4.1 billion in the three months to March 31, while net profit increased 15.5% to Dh834 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 11.7% to Dh2.0 billion, with margins expanding to 49.5%, marking a record level for the operator.

The performance was driven by strong commercial momentum in January and February across mobile, fixed, and enterprise segments, supported by disciplined execution and stable demand. March, though, brought a shift in operating conditions, with external factors weighing on activity.

March slowdown

The company said geopolitical developments were a key factor behind the softer March performance.

“March presented a change in the operating environment, that resulted in significant reduction of tourist inflows and inbound roaming activity, some pressure on gross subscriber additions, and short-term ARPU softness as both consumers and businesses moderated discretionary spending,” said Fahad Al Hassawi, chief executive officer of du.

Lower inbound roaming activity, softer subscriber additions, and reduced discretionary spending put pressure on revenue quality. At the same time, usage patterns shifted, with higher demand for fixed connectivity linked to remote working and learning.

Despite these pressures, the company said it maintained uninterrupted operations through its business continuity measures.

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Core services growth

Service revenues increased 8.7% year-on-year to Dh3.0 billion, reflecting growth across both mobile and fixed segments.

Mobile service revenues rose 7.2% to Dh1.8 billion, driven by subscriber growth and a higher share of postpaid users. Fixed service revenues increased 11.1% to Dh1.2 billion, supported by enterprise demand and expansion in home wireless services.

Other revenues grew 2.3% to Dh1.1 billion, helped by ICT services and handset sales, though lower roaming and interconnection income partly offset that increase.

Subscriber base expands

The mobile subscriber base grew 6.1% year-on-year to 9.7 million customers.

Postpaid subscriptions increased 9.6% to 2.0 million, while prepaid customers rose 5.2% to 7.7 million, mainly driven by resident demand.

The fixed subscriber base also grew, rising 6.3% to 745,000, reflecting continued demand for broadband and home wireless services.

Cash flow stays strong

Operating free cash flow increased 14.2% to Dh1.7 billion, supported by higher earnings and disciplined capital spending. Capital expenditure stood at Dh386 million, focused on network expansion, fibre rollout and data-centre investments.

The company said its balance sheet remains unleveraged, supported by strong cash generation. In April, it refinanced a Dh2 billion revolving credit facility with improved terms and a seven-year tenor, strengthening liquidity and financial flexibility.

Oulook maintained

Management said near-term conditions remain uncertain because of geopolitical developments and shifting demand patterns.

While du maintained its full-year guidance, it said more clarity is needed before making any change to its outlook. The first-quarter results show that the company’s business model remained resilient, even as travel-related activity and customer spending came under pressure in March.