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Far EasTone Telecommunications Co Ltd (TWSE:4904) reported its Q3 2025 earnings, showcasing record-high revenue and net income. The company posted earnings per share (EPS) of 0.96, surpassing the forecast of 0.9536. Revenue reached TWD 26.39 billion, slightly above the forecast of TWD 25.57 billion. Despite these positive results, Far EasTone’s stock experienced a modest decline of 0.11% in recent trading, closing at TWD 92.
Key Takeaways
- Far EasTone achieved record Q3 revenue and net income.
- EPS of 0.96 exceeded market expectations.
- The company maintained strong performance in digital services and innovation.
- Stock price saw a minor decline post-earnings announcement.
- Continued focus on digital transformation and cloud services.
Company Performance
Far EasTone demonstrated robust performance in Q3 2025, achieving record-high revenue and net income. The company reported a 2.9% year-over-year growth in revenue and a 4.9% increase in EBITDA. Its net income margin improved to 13.1%, reflecting efficient cost management and strategic focus on high-margin services. The telecom market remains saturated, but Far EasTone continues to capitalize on digital transformation trends and enterprise ICT solutions.
Financial Highlights
- Revenue: TWD 26.39 billion (record high for Q3)
- EBITDA: TWD 9.39 billion (record high)
- Net Income: TWD 3.45 billion (20-year record high)
- EPS: 0.96
- Net Income Margin: 13.1% (improved from ~10% in previous years)
Earnings vs. Forecast
Far EasTone’s Q3 EPS of 0.96 exceeded the forecast of 0.9536, marking a positive surprise for investors. The revenue of TWD 26.39 billion also surpassed the anticipated TWD 25.57 billion. This performance reflects the company’s ability to leverage its digital services and maintain a competitive edge in a saturated telecom market.
Market Reaction
Despite the earnings beat, Far EasTone’s stock price dipped slightly by 0.11%, closing at TWD 92. This movement comes amid broader market trends and could reflect investor caution in a volatile economic environment. The stock remains within its 52-week range of TWD 80.7 to TWD 95.2.
Outlook & Guidance
Looking ahead, Far EasTone plans to focus on the Double 11 shopping season and the completion of APT customer migration. The company aims to deliver key ICT projects in Q4 and continue investing in digital entertainment and cloud services. The guidance for future quarters indicates steady growth, with EPS forecasts for FY2026 ranging from 0.03 to 0.13 USD.
Executive Commentary
"We continue to lead the industry in revenue and net income," stated Chee, President of Far EasTone, highlighting the company’s strong market position. Chee also emphasized the company’s commitment to delivering value through customer-focused products and digital solutions.
Risks and Challenges
- Market Saturation: The telecom market’s saturation could limit growth opportunities.
- Economic Volatility: Macro-economic pressures may impact consumer spending and investment.
- Competitive Pressure: Increased competition in digital services could affect market share.
- Regulatory Changes: Potential regulatory shifts could pose operational challenges.
Q&A
During the earnings call, analysts inquired about the company’s dividend policy. Management reaffirmed its commitment to maintaining a stable dividend policy, indicating confidence in its financial stability and future growth prospects.
Full transcript - Far EasTone Telecommunications Co Ltd (4904) Q3 2025:
Conference Moderator, FarEasTone: Welcome, everyone, to FarEasTone’s 2025 third-quarter earnings conference call. All lines have been placed on mute to prevent background noise. After the presentation, there will be a question-and-answer session. Please follow the instructions given at the time if you would like to ask a question. For your information, a webcast replay will be available within an hour after the conference has finished. Please visit www.FarEasTone.com.tw under the Investor Relations section. Now, I would like to introduce Mr. Gary Lai, the IR Officer. Gary, please begin.
Gary Lai, IR Officer, FarEasTone: Thank you, and good afternoon, everyone, and welcome to FarEasTone 2025 third-quarter investor conference call. We have with us today our President, Chee, and CFO, Sharon. Both will share updates and our performance for the quarter to all of you. Before we begin, I would like to remind everyone to pay close attention to the Safe Harbor statement on the first page of the presentation. Thank you for your attention, and now let’s proceed to Chee’s presentation. Thank you, Chee.
Chee, President, FarEasTone: Thanks, Emily. Good afternoon, everyone. I’m here to report how we have done in the third quarter and also year-to-date third quarter. For the third quarter, we have registered TWD 26.39 billion of revenue. This is a record high for the third quarter in FarEasTone history. Also, for the EBITDA, it’s TWD 9.39 billion, which is also a record high for the same period. Net income is TWD 3.45 billion, and that is a 20-year record high. We have an EPS of 0.96. If you look at the margin rate, which is 13.1% for the net income, that is one area I pay particular attention to, and I’d like to see that continue to improve. This has been around 10% a few years back, and gradually it’s moving.
Upward, which is a good sign, and we are doing fine here. In terms of our achieved rate, you see the EBITDA, we fell a little bit short there, and this is mainly due to we have some typhoon seasons in July, and that really, the damage lasted long, and then a lot of the OpEx spent for the disaster recovery related, and then we are helping with the victims in the disaster areas. Okay. Other than that, everything else is going well. From the first three quarters point of view, we already have $77.66 billion revenue accumulated so far, and it is a 100% achieved rate. YOY, it is 2.9%. As you may know, right? For us, fourth quarter usually is the highest revenue quarter.
For what we have achieved right now, we are pleased with what we have progressed so far. For the EBITDA, it is $28.26 billion, and it is a 4.9% year-over-year growth. For net income and also the EPS, we continue to do very well, especially from the YOY perspective. With that, we can go to the next slide. All right. Just look at the trend a little bit. As I have mentioned previously, for the revenue, you can see for the third quarter, this is a 6.7% year-over-year growth. This is even though we have the iPhone launch in September, but that was already like last week of September, September 23, I think, or even later than that. Still, we had a very good September. Sales for iPhone, and then it actually continued.
We’ve seen kind of like a best in terms of the bundled service sales with iPhone. That’s our like a nine-year high. In ICT, we have quite a few deliveries and that realized revenue in the third quarter as well. That gave us a very high revenue for the third quarter. From the EBITDA, that is a record high for the same period, for the same third quarter, and the growth is like a 3.2%. This is really across all existing business segments or products that we continue to improve the margins. I think it is working. In terms of net income, as I mentioned earlier, it’s a 20-year record high, and the EPS is 0.09.
Our net income grew 8.7%, and it is my understanding that kind of leads the industry, and we continue to lead the industry in that revenue. Okay. In the net income area. Okay. All right. Okay. And some financial metrics for your information. First of all, the net debt to EBITDA continues to improve post-merger, as you can see from the numbers below there. Our free cash flow remains very strong. Okay. Our CapEx right now kind of spending a little bit behind the schedule. We expect the CapEx this year will be slightly lower than guidance, which is at the $8.3 billion mark. Okay. Next. All right. If we dive into in terms of our value streams or our major product service areas. For mobile service, the revenue and margin, both YOY, has shown a 1% increase.
iPhone 17, as I mentioned, of course, boosted always iPhone, you can count on it as a revenue booster and also the bundled sales booster. Our continued APT contract renewal is driving a more than 20% or around 20% increase in the monthly fees. With the churn also well-managed, our churn actually has come to a record low. In the digital and essential service area, we actually see a very solid growth there in both revenues, 7%, and also margin for 8%. This area consists of the fraud prevention service, and that continues to see a very good user acceptance rate. Our insurance agency business that started from the device handset insurance to all kinds of digital platform-initiated insurance products has been doing very well.
Our payment, that is a direct carrier billing, is also showing a very strong 7% year-over-year growth. Our entertainment area is one of our strategic areas that we’ll continue to invest more in. We have just created two fund joints with other companies and also our Taika for two funds. That together is more than TWD 1.5 billion kind of investment. This is one area we’ll continue to invest more in. Just seeing all these concert events, that is kind of getting all the attention where people and a lot of young people are willing to pay a lot more, a lot of money for the tickets. There is definitely a very hot market there. In the ICT and fixed business area, overall, it’s a year-over-year growth of 9%, and the margin is also showing 5%.
Our ICT revenue alone actually grew 17%. In terms of the telecom-based SI project, that itself is showing a 49% YOY. Even for the contract value, that is also showing a big growth. Quite a bit of it is because of the resilience kind of attention that the public sector and also the private companies are paying attention to. Okay. In the security, it’s referring to our subsidiary ISBU. They are growing very well, showing like a double-digit figure for the last two, three years already, and their margin is also improving very nicely. Our cloud business continues to grow, although at a little bit slower kind of pace, and that is kind of like because adjusting the mixed portfolio of the cloud customers. This is an area for our NextLink subsidiary, and we are acquiring a cloud service company in Vietnam.
This is going to give us good growth going forward as well. Okay. All right. Looking into the mobile business, oh, did I mention merchandise? I missed that. Okay. Merchandise, sorry. Merchandise is one area where we have the devices, and then we kind of go more like a diversified. Merchandise that we will start selling through our stores, and we are actually seeing some good results for our kind of proof of concept. The margin is definitely improving a lot. The iPhone 17, of course. As I mentioned, it achieved the best first-month bundle sales for since nine years. This is. Particularly, there is a high demand for base models such as the 17 Pro and also 17. Okay. Just some additional information. Okay. All right.
Looking into the mobile business, for the mobile service revenue alone, we are seeing a 2% growth. I would say it is solid because, as you know, the base is big, and the market is saturated, but we still manage to continue to add more value to the service. We continue to see the upgrades and also the migration. We still see this momentum, the growth momentum going. Also, at the same time, our post-pay output continues to improve. Even though we still are not back to the pre-merger level, we still continue to lead our peers in this area. 720, that’s where we come to in the third quarter. For the post-pay 5G penetration, we are looking at past 46% right now. It is.
My understanding is it is also leading the peers of the industry. Our post-pay churn rate, as I mentioned earlier, this is a record low. We came down to 0.76%. That means the market is a little bit more stable than you would expect. Okay. I would like to, and we would like to think that it is also our customers recognizing the value and the service, the performance that we provide. Okay. All right. We have some enterprise ICT highlights. I mentioned NextLink is expanding its Southeast Asia business footprint. We are on track to acquire majority shares of Renova Cloud Hong Kong, which owns 100% of Renova Cloud Vietnam. This is a fast-growing market. Renova already is a very profitable company. This will definitely give us extra growth that we can anticipate in the cloud area. Okay.
As I mentioned earlier, the ICT contract, we actually see very good growth. Here, the 100.02% YOY, that’s increment. This means the contract value till the end of the third quarter actually more than doubled what we had registered last year, the same period, at the same time, accumulative. SmartCity in particular actually is like a 180% growth in this area alone. There are city government work, and also for national universities, there are a lot of ESG solutions, kind of the demand. We are kind of banking on that. There are definitely lots of projects going on, and quite a few of them were kind of delivered on time in the third quarter. Also, we get some new contracts.
Digital transformation, this is the area where we, based on the Microsoft product, basically Azure, OpenAI. We see not only the product, the M365 Microsoft product, that is in good demand. It brought us kind of derivative business. That is a professional service. As a lot of companies are looking for, like, how to adopt AI, we provide that service as well. In addition to the AI-related solutions that we provide, in smart health, we have some smart hospital SI projects. These are not directly related to the telemedicine business, but these are project-based. The telemedicine business is more subscription-based, and that is ongoing. Also, for the telecom-based SI, as I mentioned earlier, the attention for the resilience for both public sector and the private companies, they definitely are driving the demand.
We have been awarded several projects in this area as well. Okay. On the consumer side, we have launched a new product, which is kind of a new concept because in the—so what is the product of a telecom company? They probably wouldn’t know what you’re talking about because all they know is about, okay, are you talking about $13.99 or $4.99? All they know is about price, right? It’s like a price tag. It’s a price table. Okay. Listed price table. I asked my team to really have a focused TA or TA-focused kind of a segment-focused product that we can design. More than the connectivity, what other kind of service that we either we authentically offer or we organically offer or we partner with our strategic alliance that provides. This is a service, and this is not a one-time thing.
You buy this for however much, and then this here is your reward, and then you go out of your way for like a three-year or one and a half years before you talk to our store again. No. This is like a throughout digital platform. You will continue to get updated to kind of vouchers or good discounts or good information about anything that is relevant or interesting to the 50-plus kind of audience, right? Or whoever is already in this mindset that you want an easy and then take the easy and then kind of lifestyle. This actually is getting a very good response from the market. Also, with this new product, we actually see the new sign-up, 20%. 20% of them are actually GA. In other words, those are not from the original existing customers that are doing the renewal.
But then it’s also new customers for Far EasTone as well. We definitely see the market is responding to this product, even though it was just launched last month. Okay. All right. Similarly, we have provided this essential services. It’s kind of like all you can think of like what you would need at home, your home repairing. And then some learning kind of lessons as well. It’s a lot of kind of freelancing services, and some are like a small business that they provide. Through this Pro 360, we made it available through our mobile circle, which has more than 6 million kind of downloads and more than 2 million active users every month. This is generating a good attraction as well. Getting the traffic flow this product needs and more awareness on this product.
We also see a good conversion rate for people using it. Okay. The Guardian Network, which is the fraud protection service, we are seeing a 52% YOY subscriber growth. There is definitely a demand for this with all these fraudulent calls or all these, I should say, all these different URLs or links, right, that you can get through Line, through FB, and through email, anywhere. Once you click on it, if you subscribe to the service, we will protect you and make sure if the link is a dangerous site that we already have information on, it will be blocked. Even if you clicked on it, the damage would not be done. Okay. Friday Video, this is our 10th year that we have set this. We have created this platform doing the streaming services.
We have the viewership record broken three times in six months. We still remain the number one local OTT in Taiwan for three years in a row now. Our paid users also grow like 20%. We have very good Korean kind of content that has been kind of our particular niche. We also have a good partnership with some of the major Korean content providers such as CJ E&M. That definitely helps. We are looking to some digital entertainment expansion, as I mentioned, the two funds already created. We have some good film investment experience, and that is also making some good profit. We have many events and many more to come. In short, I said this is an eventful year for my entertainment area, that’s for sure. All right.
Lastly, these are some recent major honors and recognitions we have received. Hot off the press, I think it was just two days ago, it was published that for the MSCI ESG rating, we received the AAA rating. I thought as an investor, you would be happy to see that. That is highlighting our continuous commitment to sustainability and corporate responsibility. We are also on the 2025 Taiwan Simi 100. This is a foreign institutional investors’ top picks. We have some other corporate governance-related award as well. I’d like to draw your attention to the right-hand side. That is, in particular, FET’s 5G Telemedicine Platform. Just recently, we were awarded by three different awards. The first one is from the, they called it Chinese, it’s really Taiwan, Taiwan Software Association.
It’s placed at the second place. For the, I need to correct, it’s the technology for the elder technology category. Okay. Then we have another. BCC Taipei, right? That is for the Better Business Award. Lastly, this is also just recent. We just received the notice like three days ago. From our Ministry of Economic Affairs, we got this 2026 Taiwan Excellence Award. We are also shortlisted for the second phase. They have another tier to be the Taiwan Excellence Gold and Silver Quality Award. Yeah. Those are just kind of like fresh recent awards we have received for your information. Lastly, and then IR always asks me, so what is your focus in the award? 2025 is almost done, right? We have like one and a half months to go.
Of course, this upcoming Double 11 shopping spree, and then any consumer would expect any kind of goodies during this time. For us, we have the video products, we have the mobile products, we have the shopping. I do expect that there will be a little booster during this time. We are looking forward to that. Of course, continue to complete the migration of the APT customers. We still have quite a few ICT projects, and this is always kind of seasonality. The last quarter, ourselves, our project management team will do everything just to deliver all these projects on time and catch up and all that. This will be a big quarter for us. We would like to finish the year strong again. Okay. With that, I conclude my presentation for you all. Thank you, President Chee.
Ladies and gentlemen, we will now begin the question and answer session. If you have a question for any of today’s speakers, please press the star key and number one on your telephone keypad, and you will enter the queue. After you are announced, please ask your question. If you find that your question has been answered before it is your turn to speak, please press the star key and number two to cancel the question. Now, please press star one on your telephone keypad if you would like to ask the question. Thank you. Please dial star one on your keypad if you would like to ask the question. Thank you. We are now in the question and answer session. If you would like to ask the question, please press star one on your keypad. Thank you. Any question? We have a live question. I will read it all out.
Congratulations that we are well ahead of guidance. Should we expect DPS to be growing at a similar rate as our EPS when we end of the year? If you ask me if that will be my rate, I can definitely tell you that it will not be the case. For DPS, certainly. Thank you for the congratulations. We do expect that we should be able to meet the guidance. That is no problem. We like to maintain a more stable, and then everybody can kind of always depend on kind of policy. The exact number and all that percentage, it is not what we tie to. I certainly hear you, and I always know that our investors are always looking for better DPS. It is just never good enough. We will continue to do our best to improve. Yes. Thank you.
Ladies and gentlemen, we are now in Q&A session. If you would like to ask the question, please press star key and number one on your keypad. Thank you. To ask a question, you may press star one on your keypad. Thank you. You may press star one on your keypad if you would like to ask the question. Thank you. As a reminder, press star one on your keypad if you would like to ask the question. Thank you. Yeah. Even if there is no more question on the call or on the web, they can always contact my IR team, Amy and Gary, so they can have more elaborated discussions, I guess. Yes. Thank you, President Chee. There are currently no questions. I’ll pass the call back to Mr. Gary Lai. Gary, please proceed. Thank you again for everybody to attend our third-quarter investor conference call.
Let’s see you next quarter. Thank you all. Thank you. Thank you. Ladies and gentlemen, thank you for your participation in Far EasTone’s conference. There will be a webcast replay within an hour. Please visit www.fareastone.com.tw under the Investor Relations section. You may now disconnect. Thank you again. Goodbye.
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