Tesco Mobile fell into the red despite its sales passing the £1bn mark during its latest financial year, it has been revealed.
The provider, which is a joint venture between the supermarket giant and Virgin Media 02, has reported a pre-tax loss of £449,000 for 2023, according to newly-filed accounts with Companies House.
The loss comes after the business posted a pre-tax profit of £8.3m in 2022.
The results also show that Tesco Mobile’s revenue increased in the year from £969.5m to £1.05bn, helped by a rise in the sale of premium handsets.
A statement signed off by the board said: “The group delivered a strong performance in 2023 against the backdrop of highly competitive mobile telecommunications market in which the overall handset market size continued to decline.”
Tesco Mobile sets sights on winning back customers
Tesco Mobile said that “market pressures” and “changes in customer behaviour” saw a decline in its prepay segment which was partially offset its postpay growth.
As a result, its customer base at the end of 2023 stood at 5.51m, down from 5.43m.
Its postpay customer base rose by 6.2 per cent to 4.01m while its repay base fell by 9.4 per cent to 1.50m.
Tesco Mobile added: “The group intends to continue to increase its customer base by launching new and innovate products and tariffs into the marketplace, whilst continuing to harness its unique supermarket mobile positioning in partnership with Tesco.”
It also said: “In early 2023, the group successfully completed migrating postpay customers to a new provisioning and online charging platform as part of a major multi-year system transformation programme.”
The results come after Tesco Mobile and Virgin Media 02 signed a ten-year renewal of their 50:50 joint venture agreement at the end of January 2024.
The business was established in 2003 and became a joint venture in 2017.