A weaker rupiah inflates the company's foreign exchange loss, mostly due to its dollar-denominated debts.
The rupiah lost more than five percent of its value against the dollar in the third quarter, compared with a nearly 3 percent gain during the year-ago quarter.
That cost the company nearly 530 billion ($53 million) in foreign exchange losses compared with a 371 billion gain in the third quarter last year.
Telkom reported net profit of 2.08 trillion rupiah for the three months ended September 30, compared with 2.35 trillion in the same period of 2004, according to Reuters calculations based on the firm's nine-month report published on Monday and its first-half data.
Analysts had forecast third-quarter net profit of 2.34 trillion, according to Reuters Estimates.
Revenue at the state-controlled company rose 20.2 percent in the third quarter while operating profit was up by 20.7 percent.
Several telecommunication analysts had forecast Telkom would maintain about 20 percent growth in revenue and operating income for the nine-month performance, with profit growth slower than the first-half's pace of 47.5 percent over the year-ago period.
The company reported nine-month net profit rose 19 percent to 5.78 trillion rupiah, operating profit rose 19.6 percent to 12.8 trillion rupiah and revenues climbed 20 percent to 30.15 trillion rupiah.
An analyst at a major European brokerage house had predicted the most valuable company on the Jakarta bourse would post 29.7 trillion rupiah of revenue, 12.5 trillion rupiah operating profit and 6.0-6.2 trillion rupiah in net income for the nine-month period.
About 33 percent of Telkom's revenue came from its mobile phone operation, a highly concentrated industry where the top three players control more than a 90 percent share of the market of more than 40 million customers.
Reuters Estimates data showed analysts predicting Telkom's net profit to reach around 8.8 trillion rupiah for the whole of 2005, with total revenue of 41 trillion. That would represent a 44 percent and 21 percent increase respectively.
Telkom controls 65 percent of Indonesia's leading mobile phone firm PT Telekomunikasi Selular (Telkomsel), with around 56 percent of the market, the company has said. Data on its subscribers as of September 30 was not immediately available.
Singapore Telecommunications Ltd holds 35 percent of Telkomsel.
The total number of cell phone users in Indonesia is expected to expand by 50 percent by this year to 45 million from 30 million at the end of 2004. Some industry executives predicted that the total number of customers could hit 80 million in three years.
Only about one-in-five of Indonesia's 220 million people own a mobile phone - compared with around 60 percent in Malaysia and more than 40 percent in Thailand - but industry executives and analysts predict rapid growth.