Mobile Internet company S Mobility Ltd (formerly known as Spice Mobility Ltd), which swung into losses in the quarter ended December 31, 2011, saw pressure on bottom line and experienced lower demand in the fourth quarter. Total revenues declined 10.4 per cent over Q3 to Rs 553.3 crore and net loss expanded 7 per cent sequentially to Rs 20.1 crore for the three months ended March 31, 2012.
Consolidated revenue rose 4.8 per cent over the same period the previous year. The company had recorded net profit of Rs 16.6 crore for the quarter ended March 31, 2011.
S Mobility continued to be weighed down by its mobile devices unit besides deterioration in profitability of its services business.
The company had switched its business model from primarily a device-maker to a mobile Internet company last year but the firm has been facing deteriorating bottom-line performance. In Q2 FY'12, the company recorded a sharp drop in profits as operating margins were severely hit in its handsets business and was compounded by decline in segment profits in services unit as well. In the third quarter, the firm swung into losses (more on that here).
The mobile devices segment incurred a loss of Rs 22.9 crore (as against Rs 26.9 crore in Q3 FY'12), which showed marginal improvement, but this was accompanied by the decline in revenue from mobile devices segment as well. Revenues from devices business shrunk over 10 per cent to Rs 497.5 crore for the quarter sequentially even as it rose around 6 per cent over Q4 FY'11.
Services business witnessed 75 per cent drop in segment profit and 98 per cent decline in profits during Q4 FY'12 over the year-ago period to Rs 30 lakh. Revenues of the services business declined both sequentially and over the same period the previous year to Rs 55.8 crore for the quarter ended March 31, 2012.