Optus network crash cost the company $40M

The outage that took down the Optus network nationwide last year has cost the company 54 million Singapore dollars (US$40.2 million) and weighed heavily on quarterly earnings.

Parent company Singtel has reported a net profit of SG$465 million ($346 million) for the December quarter, down 12.5% over last year, mostly due to the network crash. Revenue was SG$3.59 billion ($2.67 billion), 1.4% lower.

Optus, a fully owned Singtel unit, said its business had declined 2% to SG$1.80 billion ($1.34 billion), with EBITDA down 1.8% to SG$465 million ($346 million).

The November 8 outage, caused by a botched software upgrade, was probably Australia's biggest ever telecom network incident. It lasted half a day, taking 10 million customers off air and impacting emergency services, contact centers, SMS authentication and retail payments.

It was the second reputational hit on the Australian telco in just over a year. Private data of millions of customers were stolen in a cyber attack in September 2022. The perpetrators have never been identified.

Former CEO Kelly Bayer Rosmarin resigned after the network outage and the company has been headed by CFO Michael Venter while a search is underway for a new CEO.

'Tens of thousands' switched to Telstra 

Rival Telstra revealed last week the outage had driven "tens of thousands" of Optus customers to its network. But Singtel said in its filing that customer churn had already stabilized, with net postpaid adds and the net promoter score both returning to positive after about ten weeks. 

It said Optus had experienced weakness in enterprise fixed business because of churn and price erosion, but mobile service revenue had improved 3.4% due to prepaid growth and increased ARPU.

Singtel said it faced a challenging environment in its home market "amid weak corporate and consumer spending, ARPU pressure from intense price competition and the continued shift in the market to lower end plans."

Revenue slipped 2.1% thanks to lower demand for voice, handsets and pay TV, partly offset by higher mobile service revenue.

Its infrastructure unit also posted a 2.7% EBITDA decline despite boosting its topline by 16%, a result of higher spending by new data center unit Nxera to support current projects and regional expansion.

Singtel's IT services business NCS boosted revenue 4% and EBITDA by 47% due to better cost management.

The Singtel stock fell 1.26% on the SGX Friday.