PLDT Inc. (PHI) Q2 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call shows mixed signals. Basic financial performance is stable, with fiber and fixed wireless revenues growing, but overall revenue is down. Product development and market strategies are promising, with 5G and AI services expanding. However, there are concerns about wireless revenue softness and unclear management guidance. The Q&A highlights potential legal challenges and refinancing concerns, but also growth in Maya and 5G. Without clear guidance and given mixed financial results, the stock is likely to remain neutral in the short term.
Key Financial Performance
Service Revenues PHP 97.1 billion, a touch higher year-on-year, driven by steady growth from fiber and disciplined cost management.
EBITDA PHP 55.5 billion, up 3% from last year, supported by steady growth from fiber and disciplined cost management. EBITDA margin remained steady at 52%.
Telco Core Income PHP 17.2 billion, down 4% year-on-year, mainly due to higher depreciation and financing costs from network investments.
Core Income PHP 17.6 billion, up 1%, lifted by Maya's positive earnings. Maya's core earnings amounted to PHP 406 million, marking a PHP 1.1 billion turnaround from a PHP 693 million loss last year.
Home Revenues PHP 30.4 billion, up 4% year-on-year, led by strong steady fiber demand.
Enterprise Revenues PHP 23.5 billion, down 1% year-on-year, due to declines in legacy businesses and lower public sector deal closures tied to elections and leadership changes.
ICT Revenues PHP 3.2 billion, up 15% year-on-year, driven by growth in data center colocation (up 36%) and cybersecurity services (up 24%).
Individual Revenues PHP 42.3 billion, down 1% year-on-year, reflecting weaker legacy offerings. Mobile data revenues were stable at PHP 37.4 billion, making up 89% of the segment.
Fiber Revenues PHP 29.5 billion, up 7% year-on-year, now making up 97% of total home revenues.
Fixed Wireless Revenues Grew 12% year-on-year, driven by the introduction of a new 5G modem and the strength of the 5G network.
Cash Operating Expenses (OpEx) PHP 41.6 billion, down 3% year-on-year, reflecting rightsizing efforts, better campaign targeting, and improved spend efficiency.
CapEx PHP 27.4 billion for the first half of 2025, with a reduction in full-year guidance due to favorable pricing and negotiated terms with vendors.
Net Debt PHP 282.6 billion, with a net debt-to-EBITDA ratio of 2.57x. Interest cover remains healthy at 3.52x.
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Operating Highlights
KiQ Mobile Service: Launched as the Philippines' first app-based mobile service targeting Gen Z, offering personalized digital telco experiences.
VITRO Santa Rosa: Inaugurated as the country's first operational AI-ready hyperscale facility, supporting enterprises, hyperscalers, and AI workloads.
5G Adoption: 5G traffic surged 84% year-on-year, with 5G-enabled devices now comprising 17% of the customer base.
Maya Digital Bank: Achieved its first profitable semester with PHP 406 million in core income, marking a significant turnaround from a loss last year.
Cost Management: Cash OpEx reduced by 3% year-on-year, driven by rightsizing efforts and improved spend efficiency.
EBITDA Margin: Maintained at 52%, supported by growth in fiber, ICT, and personalized mobile offers.
Sustainability Initiatives: Signed agreements to source renewable energy and received multiple recognitions for sustainability efforts.
Debt Management: Net debt-to-EBITDA ratio at 2.57x, with proactive management of maturities and a diversified debt portfolio.
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Risk or Challenges
Decline in Telco Core Income: Telco core income decreased by 4% due to higher depreciation and financing costs related to network investments.
Enterprise Revenue Decline: Enterprise revenues fell by 1% due to the loss of POGO connectivity and delayed public sector deal closures tied to elections and government leadership changes.
Legacy Service Declines: Continued decline in legacy services negatively impacted individual and enterprise revenues.
Debt Levels and Financing Costs: Net debt stood at PHP 282.6 billion with a net debt-to-EBITDA ratio of 2.57x, and higher depreciation and financing costs are weighing on results.
Regulatory and Public Sector Delays: Delayed public sector deal closures due to elections and leadership changes in government agencies impacted enterprise revenues.
Competitive Pressures: Competitive pressures in the market are affecting ARPU stability and revenue growth in individual segments.
Supply Chain and Cost Management: Repairs and maintenance costs rose by 4% due to network expansion and site rollouts, highlighting ongoing cost pressures.
Economic and Market Uncertainty: Economic uncertainties and market transitions, such as the shift from legacy services to new technologies, pose challenges to revenue stability.
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Guidance & Outlook
Revenue Growth: PLDT expects additional upside from enterprise deal closures and traction from new product launches in the second half of 2025. Mobile data, fiber, and corporate data ICT now represent 90% of total revenues, with continued growth expected in these areas.
Capital Expenditures (CapEx): PLDT has revised its full-year CapEx guidance to PHP 63 billion, down from the original PHP 68-73 billion, due to favorable pricing and negotiated terms. Investments will focus on network quality, LTE and 5G upgrades, fiber port builds, submarine cables, and AI infrastructure.
Debt Management: PLDT aims to return to positive free cash flow by 2026 and targets a net debt-to-EBITDA ratio of 2.0x over the medium term. The company maintains a healthy interest cover of 3.52x and a diversified debt portfolio.
5G and Mobile Data: PLDT anticipates robust adoption of 5G and increased data usage to support future growth. 5G traffic surged 84% year-on-year, and 5G-enabled devices now make up 17% of the customer base, up from 11% a year ago.
Enterprise and ICT Growth: ICT revenues grew 15% year-on-year, with data center colocation up 36% and cybersecurity services expanding by 24%. The company expects delayed public sector deal closures to be booked in the second half of 2025.
Maya's Financial Performance: Maya, PLDT's fintech arm, is expected to continue its profitability trajectory, contributing significantly to PLDT's core income. Maya's deposits and loans are projected to grow further, supported by new product launches and ecosystem integration.
AI and Data Center Expansion: PLDT's VITRO Santa Rosa, an AI-ready hyperscale facility, positions the Philippines as a regional hub for digital services and AI innovation. The facility is expected to drive growth in colocation revenues and enterprise AI solutions.
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Shareholder Return Plan
Interim Cash Dividend: The Board declared an interim cash dividend of PHP 0.48 per share, in line with the regular payout policy of 60% of Telco Core income. This corresponds to a Telco Core earnings per share of PHP 0.80 for the first half. Based on PLDT's closing share price as of June 30, the 12-month trailing yield stands at about 8%.
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Key Q&A
Q:What is driving the softness in trends for wireless revenues, and what is the outlook for the third quarter?
A:The dip in wireless revenues is attributed to normal fluctuations. Management expects revenues to recover in the second half, driven by innovations and a focus on delivering value for money to customers.
Q:What is the status of the Konektadong Pinoy Bill, and what are the potential outcomes?
A:If the President does not return the bill by August 24, it will become law. Management hopes the President will veto the bill to allow Congress to consult stakeholders and address constitutional issues. If passed, telcos may challenge it in the Supreme Court due to concerns about discriminatory treatment and disincentives for infrastructure investment.
Q:What guidance can be provided regarding refinancing activities for maturing debt?
A:Interest rates remain high, but management has negotiated lower spreads (40-60 basis points). They are also borrowing long-term facilities with floating rates to benefit from potential declines in interest rates.
Q:Are there updates on 5G cities and their impact on ARPU?
A:5G cities are being expanded to provinces like Iloilo. ARPU for 5G users is PHP 300 compared to PHP 101 for LTE users, indicating a significant revenue uplift.
Q:What are the updates on asset monetization plans, including the data center sale and copper assets?
A:The data center sale is under consideration with ongoing inquiries. Copper asset negotiations are ongoing, and there is a broader program to monetize legacy assets, including 3G equipment.
Q:What are the plans for the home business prepaid segment?
A:Prepaid is targeted at price-sensitive households and first-time fiber users. It is seen as a strategic entry point and not cannibalizing postpaid. Growth will come from deeper penetration and entering emerging markets.
Q:Why did Enterprise revenues decline, and what is the outlook for the second half?
A:Revenues declined due to delays in public sector deals caused by elections and other factors. Management expects growth in the second half, supported by new deals like the emergency 911 services program.
Q:What is the demand for GPU as a service in the enterprise space?
A:There is growing demand for AI-related services, and the company is capitalizing on this with NVIDIA GPU servers at the VITRO Santa Rosa data center.
Q:What is driving the growth in Maya's NIMs, and what is the outlook for NPLs?
A:NIMs are increasing due to higher LDRs and growth in credit card and personal loan products. NPLs are expected to stabilize soon, and the company is focused on managing risk.
Q:What is the target loan-to-deposit ratio for Maya Bank, and are there plans for capital raising or an IPO?
A:The LDR is below 50%, with room for growth. There are no immediate plans for capital raising or an IPO as the company is profitable and cash flow generative.
Q:What innovations are being pursued for the home fiber business?
A:Innovations include partnerships with entertainment, smart home, and gaming companies, as well as a no-frills brand targeting emerging markets. The goal is to make PLDT the digital hub of every home.
Q:What is the guidance on revenue and margins for the second half of 2025?
A:Management aims to match last year's core income but is slightly behind. They are focused on maintaining profitability and potentially achieving higher net income.
Q:How is Maya driving loan growth, and is it competing directly with GCash?
A:Maya offers a diversified range of credit products for consumers and businesses. It focuses on mass affluent and Gen Z customers, differentiating itself with unique offerings like credit cards.
Q:Review of Unclear Management Responses
A:Management avoided providing specific guidance on revenue and margins for the second half of 2025, citing ongoing navigation of the business. Additionally, they did not disclose detailed financial splits for Maya's banking and merchant acquiring segments, stating that more robust financials would be released later.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
COO
Chief Officer
Corporate Participant
De Venecia
Director
Gen
ICT PHP
Joan De
Mr PLDT
Officer Mr
PHP fiber
PHP segment
PHP semester
PLDT Head
Participant Anastacio
Senior VP
Smart
Sunday
Venecia Fabul
app
area fiber
computing
country AI
deal closure
decline legacy
election
experience
freedom
generation
need
rack
revenue PHP
sector
solution
spot
stickiness
PHI Transcript
PLDT Inc. (PHI) Q4 2025 Earnings Call Transcript
Unknown2-26
The earnings call reveals mixed signals: strong revenue growth in certain segments, Maya's profitability, and strategic expansion plans are positive. However, the lack of guidance on key metrics, concerns over broadband, and increased interest expenses pose challenges. The Q&A highlights uncertainties, particularly around Maya's IPO and provisioning levels, which tempers optimism. The absence of revenue and EBITDA guidance adds to the uncertainty, leading to a neutral sentiment overall.
PLDT Inc. (PHI) Q3 2025 Earnings Call Transcript
Positive11-11
The earnings call highlights robust growth in key areas such as 5G adoption, enterprise and ICT revenues, and Maya's financial performance. Despite some concerns about Maya's net income drop and mobile business performance, the overall outlook remains positive with strong financial metrics, improved cash flow, and strategic investments in AI and digital infrastructure. The Q&A session revealed optimism about government projects and potential partnerships, though some regulatory uncertainties persist. Overall, the company's strategic initiatives and financial health suggest a positive stock price movement over the next two weeks.
PLDT Inc. (PHI) Q2 2025 Earnings Call Transcript
Unknown8-12
The earnings call shows mixed signals. Basic financial performance is stable, with fiber and fixed wireless revenues growing, but overall revenue is down. Product development and market strategies are promising, with 5G and AI services expanding. However, there are concerns about wireless revenue softness and unclear management guidance. The Q&A highlights potential legal challenges and refinancing concerns, but also growth in Maya and 5G. Without clear guidance and given mixed financial results, the stock is likely to remain neutral in the short term.
PLDT Inc. (NYSE:PHI) Q1 2025 Earnings Call Transcript
Unknown5-16
The earnings call presents a mixed picture. Financial performance shows stable core income and revenue growth in fiber and ICT, but a decline in telco core income and mobile revenue. The Q&A reveals ongoing challenges, such as POGO revenue pressures and a lack of guidance for 2025 net income. However, there are positive aspects like the signing of a large hyperscale customer for VITRO and sustainable subscriber growth. The lack of guidance and ongoing depreciation costs offset some positives, resulting in a neutral sentiment.
PHI Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
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They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
