Broadband ISP TalkTalk Publish UK Accounts to Reveal Surge in Losses
In a perhaps unsurprising development, the TalkTalk Group finally published their annual accounts yesterday and revealed that they made a statutory loss before tax of £465m for the year ended 28th February 2025 (up from £153m last year). The company also lost 420,000 UK broadband customers, leaving them with a group total of 3.2 million.
Quite a few of the figures in the group’s latest report were already in the public domain (here and here), although the full results provide a much more all-encompassing summary of the challenges TalkTalk has been facing. All of this helps to illustrate why the recent £100m funding deal (here), which itself followed last year’s £400m refinancing package – necessary to avoid a default on its debts (here and here), were so crucial.
The group, which has also experienced some job losses (here) and now has 1,570 employees (down from 2,065), is still not out of the woods. The company has thus continued to hunt for a buyer for different parts of their business (here), while also recently migrating another batch of their legacy broadband and phone customers (here) over to the Utility Warehouse (Telecom Plus) and suffering payment disputes with suppliers (here and here).
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The results note that monthly churn increased year-on-year to 2% (up from 1.9%), while revenue declined to £1,412m (down from £1,518m) and on-net average revenue per user (ARPU) fell slightly to £25.46 (down from £25.74), mostly due to price rises being offset by the reduction of usage and boosts (add-ons). Gross profit now stands at £692m (down from £746m), although headline operating costs did decrease to £418m (down from £495m).
The overall level of net debt (excluding leases) has now risen from £985m last year to £1,206m this year, or from £1,785m to £1,966m if you include leases. But the proportion of their broadband customer base now on full fibre (FTTP) lines has increased from 15% to 22%.
TalkTalk Statement
“The markets in which our businesses operate have remained fiercely competitive. As a value challenger brand, we have continued to provide a value-based proposition to both wholesale and consumer customers and have remained focused on product reliability and improving customer service.”
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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TalkTalk suggests in its report that the decline in customer numbers was driven by the retrenchment from unprofitable product offerings. If this is the case, the ARPU should improve going forward.
The report also places greater emphasis on the Wholesale business than the consumer side suggesting that if there is any sale it is possible that the consumer side will be the first to sold.
The info we get on this site is very good, having been told a while back that the customer base had fallen to 3.2 million, confirmed today with these results. Hard to know what will happen next to TalkTalk, as investors still think it worthwhile to keep putting money in to keep them afloat.
The underlying business is a sound one – £692M gross profit, after all – but is being dragged under by the weight of the debt built up through decades of mismanagement.
£377 debt per customer. Less than a lot of altnets, but still hard to see how that ever comes down.
Losing £145 per customer per year. Quite an impressive achievement.
Deader than Python’s parrot.
All focus needs to be on customer service. Speaking offshore is just soul destroying and untrained and inexperienced advisors are a problem.
If the customer service is good, people will stay!
Absolutely agree
Completely agree,customer services from abroad are very hit and miss,more misses
than hits.It seems if your query isn’t on a everyday question and answer list
God help you.
Doesn’t help they’ve just transfered a fair few roles over to North macedonia while adding to the UK unemployment figures.
The government need to put a stop to this on going resource drain.
TalkTalk has moved or is in the process of completing the move to a Community Support centric service to reduce costs – a model already used by several MVNOs.
The main focus must remain on refining the operational model to reduce costs and to improve ARPU.
How is this possible are other isps also in trouble like this? how could it be so wrong.
The price of broadband in the UK isn’t sustainable. It barely covers running costs, let alone making any kind of return for the investors who lent money to build the networks. In the worst cases, the revenue per customer is less than the interest on debt accruing per customer.
There are only two network providers operating in the broadband sector that can realistically claim to be making a profit from their efforts.
I think customer service should be in the UK not abroad that way more people would stay I haven’t had many problems I am quite happy with the service
Customer Service teams are rapidly being reduced in size by the roll-out of AI.
@Far2329Light: Al will probably be worse than outsourced customers service departments. in my humble opinion, the jobs lost will mainly not be in the UK, one positive.
@Fibre Scriber: The AI services that have already been deployed are indeed in many cases worse than the humans they are replacing but that is not the case across the borad.
You are correct about overseas teams being removed from handling customer services in several cases I am aware of, but from my experience that was a trend that was already established sometime ago, long before the recent in adoption of AI. I would suggest that AI is already causing the loss of jobs in the UK customer services sector.
A prime candidate for a takeover, Probably BT would like to get their hands on them. They only really need the customer base so could cut a lot of costs
I can’t imagine they would want to take on the debt so I guess they would only be interested in the customer base if Talk Talk go down, although the base might be a good fit for Plusnet which BT now seem interested in again. The question would then be is what to do with customers that Talk Talk have provisioned on altnets.
I think a change of ownership around TalkTalk, if it happened, would be more nuanced than a single transaction.
I tried really hard to stay with Talktalk when we moved house but they cancelled 3 orders without notice. Customer service was truly appalling and they couldn’t promise a 4th order wouldn’t also be cancelled. It may be that Openreach cancelled the orders due to non payment by Talktalk but of course I don’t know. Eventually gave up and Sky connected us in 2 days
It’s possible that 100k of losses were related to the disastrous acquisition of the sse/ovo base whom numbered 150k at acquisition and as soon as they tried to use company ‘pega’ for billing on a new system called ‘titan’ half the customers failed to be sent a bill leaving 50k of the customers with free broadband for a year and counting. I’m one of them! Thanks for the free broadband guys! It seems they tried to rebrand to origin after obtaining that company and sacking all its employees according to a few known to me. The rebrand went badly and they couldn’t acquire customers due to ‘titan’ and talktalk offed it to utility warehouse whom simply couldn’t control the disaster of a system sse created with pega and decided to get rid of all the imbeciles responsible and let’s see how they can recover without the sse idiots at the helm.
Too expensive. Decreased after ordered cancellation then year later it’s back only £3 difference.
Customer Service is disgusting took me more than 30 minutes to explain thet the cable for my super fast broadband has risen above the tarmac eventually they contacted CityFibre after 5 days CityFibre said i had to contact TalkTalk a month has passed and problem still ongoing eventually the cable will get caught and I will end up with no Internet. My contract is due for renewal in October but I’m seriously considering moving to another provider