Earnings call transcript: Globe Telecom sees Q2 2025 revenue rise amid challenges

Globe Telecom reported a modest rise in consolidated gross service revenues for the second quarter of 2025, reaching PHP 40.3 billion, a 1% increase from the previous quarter. Despite a challenging macroeconomic environment, the company maintained a robust EBITDA margin of 53% and achieved a sequential core net income growth of 30% to PHP 5.9 billion. The stock price of Globe Telecom experienced a slight dip of 0.06%, closing at PHP 1,730. The company stands out with an impressive 11.11% dividend yield and maintains its position as a prominent player in the Wireless Telecommunication Services industry, according to InvestingPro data.

Key Takeaways

• Consolidated gross service revenues increased 1% quarter-over-quarter.
• Core net income grew by 30% sequentially.
• Globe Telecom expanded its 5G network and fiber connectivity.
• The company maintained a strong EBITDA margin of 53%.
• Stock price decreased by 0.06% in the latest trading session.

Company Performance

Globe Telecom demonstrated resilience in the face of economic challenges, achieving a slight increase in revenue and notable growth in core net income during the second quarter. The company continues to lead in mobile data services, maintaining network consistency for nine consecutive quarters. Its strategic focus on customer experience and network performance has been pivotal in driving customer loyalty.

Financial Highlights

• Revenue: PHP 40.3 billion, up 1% from the previous quarter.
• EBITDA: PHP 21.4 billion, a 3% increase quarter-over-quarter.
• Core net income: PHP 5.9 billion, up 30% sequentially.
• Gross debt reduced to PHP 247.9 billion.
• Gross debt to EBITDA ratio: 2.65x.

Outlook & Guidance

Looking ahead, Globe Telecom aims for low to mid-single digit service revenue growth while maintaining an EBITDA margin of 50%. The company plans to keep capital deployment under $1 billion for the year, with continued investments in digital infrastructure and customer experience enhancements. With a 23-year track record of consistent dividend payments, Globe Telecom demonstrates strong commitment to shareholder returns. Detailed analysis of the company’s growth trajectory and future prospects is available in the comprehensive Pro Research Report on InvestingPro.

Executive Commentary

CEO Carl Cruz stated, "The vision is to be the most valuable, most profitable, and most admired operator in the country," emphasizing the company’s commitment to customer experience and loyalty. Carlo, an executive, highlighted growth in new business areas such as insurance and ad tech, contributing to the top line.

Risks and Challenges

• Economic Environment: Weak consumer sentiment and high inflation could impact spending.
• Market Competition: Intense competition in online lending and mobile services.
• Capital Expenditure: Reduced capital expenditures may affect infrastructure expansion.

Globe Telecom’s strategic initiatives and robust network performance position it well for future growth, despite the prevailing economic challenges.

Full transcript - Globe Telecom Inc (GLO) Q2 2025:

Moderator, Globe Telecom: Good morning, everyone, and welcome to the Second Quarter twenty twenty five Analyst Briefing of Globe Telecom. We will begin with a video presentation of our performance and a few updates on the digital platform businesses to be followed by the Q and A session.

Executive Presenter, Globe Telecom: Welcome, everyone, and thank you for joining us for our second quarter twenty twenty five analyst briefing. We are pleased to report that Globe enjoyed strong operating and financial results in the 2025, with the second quarter reversing the softness from earlier in the year. The company’s consolidated gross service revenues in second quarter increased by 1% quarter on quarter and reached MXN 40,300,000,000.0. This was driven by sustained data usage momentum, which translated to data related revenues accounting for 88% of the quarter’s top line. On a six month basis, Globe’s consolidated gross service revenues were 2% softer year on year as the company navigated a complex macroeconomic environment and shifting consumer preferences.

Even with inflation starting to go down, prices of consumer staples as a percentage of household income remains costly. This, coupled with persistently weak consumer sentiment and evolving consumer behavior, continued to weigh on telco spend. Amidst this backdrop, Globe continued to implement its cost optimization program, ultimately resulting in EBITDA growing by 3% quarter on quarter to MXN 21,400,000,000.0. The company’s EBITDA margin of 53% held firmly above guidance. Meanwhile, for the first six months, Globe’s EBITDA reached MXN 42,100,000,000.0.

This, combined with higher share in equity affiliates, led to a 30% sequential improvement in core net income to MXN 5,900,000,000.0, pushing the six month figure to 10,400,000,000.0 pesos. With that, we are also happy to share the following developments within Globe, each of which we’ll be discussing in greater detail later in the presentation. Firstly, Globe is approaching the final phase of its tower sale and leaseback program with the announcement of the most recent tower turnovers to key partners, MIDC and Phil Tower, last July 30. Second, STT GDC Philippines has achieved significant progress with the construction of STT Fairview 1 with the first customer set to move in, in the 2025. Thirdly, Mint, the parent company of GCash, contributed to twenty six percent of Globe’s net income before tax in the first half.

And lastly, given these consistently robust results, the Board of Directors has approved the third quarterly cash dividend of $0.02 5 per share, consistent with our declarations over the past few years and reaffirming our commitment to a sustainable dividend policy. Let’s now discuss Globe’s operating performance. Starting off with the mobile segment, total mobile revenues amounted to MXN 57,100,000,000.0 in the first half of the year, down 2% year on year, mainly due to the continued declines in legacy voice and SMS services. This softness reflects broader consumer sentiment, which, as indicated by the latest surveys, point to persistent concerns around high prices of goods and services, lower household income, and limited job availability. Mobile data revenues, nevertheless, reported a 2% year on year uplift in the first half, supported by sustained network investments that enhanced service quality and competitiveness.

That said, Globe saw a clear recovery in the second quarter with mobile revenues rising 2% sequentially. This rebound was supported by stable data traffic, improving monetization, and seasonal uplift from midyear election activity. Mobile data now accounts for 86 of total mobile revenues, a testament to Globe’s drive for digitalization. The company’s continued progress is also evident in the steady growth of its mobile subscriber base, which reached 62,500,000 as of end June twenty twenty five, higher by 1% quarter on quarter and 5% compared to the same period last year. This expanding base, combined with the rising intensity of data consumption, reflects the Filipino’s continued data habituation.

Data is increasingly becoming a daily essential as Filipinos embed digital connectivity into every aspect of life. Case in point, mobile data traffic grew substantially quarter on quarter to reach 3,187 petabytes by the June 2025, while mobile data monthly APU hit 15.4 gigabytes, an improvement of 7% quarter on quarter. Note that data traffic growth outpaced the 2% sequential increase in actual mobile data users to 37,800,000, underscoring Globe’s effective market repair strategies as the company strives to create more value for its customers. To give more context to this first half performance, average daily mobile top ups remained stable despite the shifting market dynamics in the first half. Further, Globe’s average daily wireless traffic continued to improve each month during the period, allowing for further data monetization.

This monetization is further amplified by our five gs customer base, which delivers markedly higher value per user than non five g subscribers. As of end June, average daily five g mobile traffic demonstrated a promising upward trend, growing by 58% from December 2024, alongside a 33% expansion in five gs ATPU. Turning to the broadband segment. Globe closed the first half of the year with PHP 11,700,000,000.0 revenues, lower by 3% compared to 2024, owing to decrease in fixed wireless contributions as more customers transition to fiber. Fiber’s share of total broadband revenues, as a result, rose to 90% from 85% a year ago, reflecting the 2% growth in fiber subscribers and 35% expansion in fiber revenues.

Nonetheless, home broadband revenues showed signs of stabilization with second quarter revenues inching up 1% quarter on quarter to MXN 5,900,000,000.0, supported by continued momentum in fiber adoption. This stabilization is also becoming evident in non fiber segments, particularly fixed wireless and legacy. Fixed wireless now contributes 7% of total broadband revenues with its revenue decline sustaining deceleration from negative 9% to negative 7% in Q2 compared to the same period last year. This trend reflects a more stable active base, strong reload behavior and healthy ARPU. Globe remains committed to supporting the fixed wireless segment even as it accelerates fiber expansion in line with its strategy to broaden broadband accessibility across the country.

This expansion was backed by gFiber prepaid surge in popularity and accelerating subscriber growth trajectory. Coupled with world class NPS, it is a testament to a growing base of delighted customers. Total GFP subscribers climbed 37% sequentially to 544,000 by end June as the sustainable pace of acquisitions showcased persistent growth across consecutive quarters, cementing Globe’s leadership in mass market fiber. GFP’s flexible and affordable model continued to attract more users with reload rates at 68%, the highest in its segment. Average daily top ups for GFP also rose sharply, growing by over 4.5 times in 2Q twenty five compared to the 2024 average, indicating stronger usage and deeper monetization per subscriber.

These indicators affirm Globe’s disciplined delivery on fiber rollouts and broadband enhancement programs, scaling its infrastructure to over 600 fully fiber converted towns while boosting subscriber penetration, tightening network quality and elevating service quality across its user base. Meanwhile, corporate data revenues slid by 2% year on year to 9,600,000,000.0 pesos in the 2025, primarily due to the 12% contraction in core data services as cautious business sentiment in the first half of the year weighed on the segment. This was partly offset by the 15% increase in ICT revenues resulting from the robust demand for business application services with additional growth across cloud, cybersecurity, data center, big data, and IoT solutions. This performance underscores Globe’s strategic pivot toward delivering high value, future ready ICT offerings aligned with the evolving needs of its enterprise clients. On a quarter on quarter basis, Globe’s corporate data revenues inched lower by 2% to MXN 4,800,000,000.0.

Non telco revenues, on the other hand, amounted to MXN 1,200,000,000.0 in the first half, a 2% reduction from a year ago due mostly to lower earnings from AdSpark, partly offset by stronger contributions from Asticom. Nevertheless, as with Globe’s other operating segments, there was a turnaround in performance in the second quarter with revenues rebounding by 3% sequentially. Mint, the holding company of GCash, continued to deliver robust results, further reinforcing its position as the country’s leading digital financial ecosystem. Mint expanded both its user base and profitability, providing more Filipinos with accessible and inclusive financial services through continuous innovation. Globe’s share in Mintz equity earnings for the 2025 rose to 3,800,000,000.0 pesos, a 78% increase from 2,100,000,000.0 pesos in the same period last year.

This now accounts for 26% of Globe’s pretax net income, more than double its 12% contribution in the same period last year and higher than the preceding quarter’s 22. Consistent with the company’s efforts to bring free cash flow back to more sustainable levels, Globe’s cash capital expenditures for the first six months of twenty twenty five totaled approximately 18,900,000,000.0 pesos, representing a 33% reduction compared to the previous year. This decline reflects the company’s ongoing efforts to optimize capital deployment while sustaining critical investments in network infrastructure. The cash CapEx to revenue ratio improved to 24% from 34%, underscoring enhanced capital efficiency in the first half, which allows Globe to maintain flexibility for calibrated investments over the remainder of the year. As in prior periods, around 91% of total expenditures were directed toward data related initiatives, affirming Globe’s commitment to strengthening its digital infrastructure With focused investments and innovation shaped by customer needs, Globe is helping more Filipino homes and small businesses thrive in today’s connected world.

During the first six months, Globe made significant progress expanding and modernizing its network to meet the growing digital demand across the country. A total of nine thirty seven new cell sites were deployed, while 4,512 existing sites were upgraded with LTE technology, enhancing both reliability and service quality for mobile users. Globe also further strengthened its five g footprint, rolling out 444 new five g sites across key locations nationwide. As of end June, five g coverage reached 98.71% of Metro Manila and 97.97 of major cities in the Visayas and Mindanao. Furthermore, to support the rising need for fast and dependable Internet, Globe also accelerated the rollout of its fiber broadband network, deploying 35,821 new fiber to the home lines.

As part of its broader modernization push, Globe has now migrated over 600 towns nationwide to full fiber connectivity, completely phasing out legacy copper lines in these areas. The shift delivers faster and more stable for everyday digital activities, whether for remote work, online learning, ecommerce, or public services. Meanwhile, as an update to Globe’s tower sale and leaseback initiative, last July 30, the company closed the sale of 12 ground based towers to MIDC for approximately 144,000,000 pesos and finalized the turnover of 84 towers to fill tower for 1,200,000,000.0 pesos. Globe has now officially turned over 6,945 towers under the SLB portfolio, raising 89,300,000,000.0 thus far. This marks a major milestone in the company’s tower monetization initiative.

With the substantial handover of sites, Globe is approaching the final phase of the tower sale and leaseback deal continuing to move forward in its goal of strengthening its financial position, while at the same time effectively optimizing its investments in critical infrastructure. This commitment is further demonstrated by Globe’s long term strategy to future proof The Philippines’ digital infrastructure. To demonstrate, last July 20, we announced that Globe has joined the Asia United Gateway Consortium, a group of telecommunications companies building a high capacity submarine cable system that is envisioned to strengthen regional AI driven connectivity. The 8,900 kilometer AUG East Cable aims to deliver additional bandwidth and strengthen network diversity and reliability along a key route linking Singapore and Japan. With this initiative, Globe is reinforcing its role not just as a service provider, but as a strategic enabler of national digital resilience and competitiveness, supporting industries, enterprises, and communities in an increasingly connected region.

While the company continues investing in long term digital resilience through initiatives like this, it also remains steadfast in addressing the immediate needs of communities, especially during times of crisis. As an example, Globe continued to deliver urgent support through its Alagan Globe disaster response initiatives in the wake of the successive weather disturbances that plagued The Philippines last July. Globe’s network remained largely intact across Luzon. Restoration efforts were swiftly acted on in coordination with local power providers and emergency response units to ensure that the company delivered timely and compassionate services during times of crises, reinforcing its reliability and unwavering commitment to its customers when it matters most. Also, Globe strategically leverages technology for societal benefit, exemplified by its BioNihan SIM program.

This initiative collaboratively launched with the DICT in Dona Remedios, Trinidad, a geographically isolated and disadvantaged area or Gita in Bulacan, aims to provide vital connectivity to underserved communities. As an update to recent events, while Globe fully supports Connectadon Canois aim for fast, affordable, and reliable Internet. The company believes the bill can still be improved for everyone’s benefit. Globe echoes the PCTO’s position that the bill should prioritize protecting Filipinos, promoting fair competition, and encouraging investment from existing telecom players. This includes ensuring all DTIPs undergo national security vetting and are cybersecurity ready from day zero.

Globe advocates for new DTIPs to fulfill missionary roles in GITAS and for access to infrastructure to be negotiated, not mandated. Critically, the bill should follow technology neutrality, avoiding favoritism towards In line with Globe’s commitment to achieving net zero, advancements have been made through the introduction of ecosystems for prepaid and TM customers and by scaling the use of renewable energy to energize a total of 33 high energy utilization sites, including sites in Mindanao. Strong emphasis is also placed on data privacy and cybersecurity. Globe has successfully intercepted 484,000,000 spam and scam messages and blocked over 254,000 sites containing child sexual abuse or exploitation materials, thereby cultivating a more secure digital landscape. Furthermore, Globe champions digital skills and online safety, having engaged over 11,600 students and educators nationwide in 2025.

The company’s unwavering commitment to sustainability and corporate governance is garnering significant recognition. Globe is once again included in the Fortune Southeast Asia 500 named for the first time as Time Magazine and Statista World’s Most Sustainable Companies for 2025 and recognized most recommended telco brand in The Philippines at the Synergy Uguff Awards. With sustainability deeply anchored in its purpose, Globe remains steadfastly committed to creating a globe of good. Moving on to Globe’s other exciting businesses. Let’s start off with STT GDC Philippines, which we are happy to give more updates on.

First, regarding the company’s capacity, we are pleased to share that the company currently operates over 20 megawatts of current capacity and remains firmly on track to increase this to over 30 megawatts by the end of the year through our ongoing construction activities. This expansion aligns with our strategic growth initiatives and addresses increasing market demand. Moving on to construction updates. At FTT Fairview One, the company has achieved significant progress. We now have cooling and power available within our customer data halls, a critical milestone for operational readiness as our incoming customer deploys in parallel.

Our dual high voltage commercial power feeds are now energized. Additionally, multiple cable entrance facilities and telco providers are available on-site, giving us diverse power and connectivity. Testing and commissioning are currently ongoing, bringing us closer to full deployment. We are also pleased to report that the occupancy permit for phase one a has been acquired, ensuring regulatory compliance. Furthermore, key equipment have been positioned, mitigating potential supply chain risks.

For STT Cavite two, the company’s construction efforts continue to advance. Our commercial power feed has been energized, and we have ongoing testing and commissioning. We are also actively processing the occupancy and related permits for STT Cavite two with an eye towards timely completion. Our rack count will increase to over 4,100 racks by August, up from over 3,200 racks in the 2025, demonstrating strong demand and bringing overall utilization to 69%. While this reflects the recent increase in available capacity, we anticipate utilization rates to improve as new capacities are brought online and filled.

Incremental capacity is still expected to increase by 15 megawatts by year end owing to FTT Fairview one and FTT Cavite two. Beyond construction, we were proud to host practical insights, the ST TGDC global series that delves into the realities of scaling generative AI within organizations with guest speakers from Google, Amazon Web Services, Dell Technologies, GCash, and Novare Technologies. This significant event brought in customers and guests alike and took place at the Grand Hyatt in May 2025, further solidifying our position as a thought leader in the industry. Further, our AI Synergy Lab continues to thrive, now hosting two users with another one coming soon, indicating growing interest. Our current users include the partnership of Ateneo de Manila Business Insights Laboratory for development or build and Packworks with specific use cases, including geospatial analysis via FILSE’s satellite borne photographs with Packworks’ sorry sorry store coordinates.

Also included is GCash, which is exploring continued pre training of open source models, segmented knowledge distillation, and large vision models. The lab is currently running multiple use cases and utilizing up to approximately 80% of the company’s GPU capacity, showcasing its operational efficiency. Looking ahead, the University of the Philippines will be joining the foray, focusing on robotics and machine vision, as well as multimodal LLMs, further diversifying our user base and demonstrating the lab’s broad applicability. In closing, STT GDC Philippines remains committed to consistently delivering on its promises and actively engaging with its customers to ensure they are future ready. The company’s continued expansion and the successful operation of initiatives like the AI Synergy Lab underscore our dedication to being at the forefront of digital infrastructure, positioning us for sustained growth and value creation for our shareholders.

The company is not just building data centers, it is laying the foundational infrastructure for the digital economy, ensuring its services are ready for the evolving demands of tomorrow. Now turning to Mint. GCash remains a constant in Filipinos’ everyday lives as we continue to serve eight in 10 Filipinos who have used GCash for essential financial services. We are also empowering more Filipinos abroad as GCash overseas expands its footprint to a total of 145 countries from 16 countries in 2024. This allows more of our Kababayans abroad to experience the benefits of GCash by registering with their international SIMs.

In line with being part of Filipinos Everydays, GCash Commute is now live in partnership with the Department of Transportation. We introduced better and faster ways to pay across the MRT 3. With our new Commute QR, commuters can easily pay by scanning their QR code on the MRT fast lane. They can also choose to pay by tapping their GCash Visa card or any Visa and Mastercard or by tapping their NFC enabled phone on the turnstile with tap to pay. These features help speed up boarding and avoid overcrowding at ticket booths for a smoother and easier commuting experience.

This is a big step toward a first world commuting experience for every Filipino. As GCash becomes more embedded in daily life, more users are turning to financial services. For lending, we have dispersed loans worth 287,000,000,000 pesos life to date, an 85% increase from last year to over 9,500,000 unique borrowers, all powered by our in house credit score, g score. GCash recently partnered with AC Health to bring g gives to Healthway clinics. With test now, pay later, users can get diagnostic tests done at select branches and pay in installments.

In wealth management, we’re enabling more users to access financial products better suited to their needs. G Save now serves 14,500,000 users, connecting them to our growing portfolio of partner banks. Our newest partner, Sibuana Lulia Bank, is now available on G Save, allowing users to open an account and enjoy a 3.5% interest rate on their savings. G stocks now has 1,400,000 registered users who can now conveniently trade on the Philippine Stock Exchange. G Funds now has 8,300,000 users who can easily schedule their investments with the auto invest feature.

Meanwhile, G Crypto is growing with 3,500,000 users who can trade different cryptocurrencies. Our users can also look forward to the upcoming full launch of g Coach AI. G Coach is like having a smart money mentor in your pocket. It offers real time tips to help you make better financial decisions on saving and investing. Finally, through gInsure, we have sold 63,300,000 policies to 16,800,000 users life to date, helping them prepare for emergencies.

To make insurance more accessible, GCash now offers free health insurance to eligible biload users with up to 30,000 pesos in coverage and added benefits. We are also happy to announce that G Bonds is now available to the Filipino public. In partnership with the Bureau of Treasury and powered by Philippine Digital Asset Exchange and bonds.ph, g bonds enables fully verified GCash users to access fixed return government securities. With a minimum investment of 500 pesos, they can earn interest as high as 5.4% per annum. And in just three easy steps, Gcash users can take advantage of this new investment offering.

Beyond GCash’s impact in financial services, we are also driving transformation across key sectors in The Philippines. As a champion of innovation, we recently concluded our annual innovation summit, IGNITE. The event was our biggest one yet, gathering global and local tech providers, industry experts, and government partners to discuss the latest technology like AI and how we can harness it for national development, financial inclusion, and resilience. We also continue to partner with the government to drive financial access. As part of our DigiCities initiative, we partnered with Passaic City to make financial aid disbursement faster with the pilot launch of the Passaic City ID for 1,500 beneficiaries of the Travel City Scholars Assistance Program.

In partnership with the DSWD along with Globe and Ayala Foundation, GCash also helped expand financial access to communities in Palawan under the agency’s program. Through this, we are enabling them to receive their four p’s digitally through GCash and empowering them with opportunities through financial literacy workshops. Lastly, GCash remains a powerful platform for driving social good. We recently onboarded 11 additional NGOs in g by Nihon, expanding the options available to users who wish to donate. And in the aftermath of typhoon creasing, donations were made through various g by Nihon organizations in order to quickly respond to the needs of affected areas.

That concludes Mint’s updates. Now on to the final portion of the presentation, Globe’s financial highlights. To summarize the earlier points made, Globe’s gross service revenues for the first half amounted to MXN 80,200,000,000.0, softer by 2% against the same period last year, a reflection of the increasingly complex macroeconomic environment and evolving consumer behavior. Globe’s cost management initiatives continued to deliver results with total operating expenses and subsidy reaching MXN 38,000,000,000 in the 2025, 3% lower year on year. EBITDA for the first six months stood at 42,100,000,000.0 pesos, sustaining a robust EBITDA margin of 52.6%, exceeding Globe’s full year guidance.

Depreciation increased by 7% year on year to MXN 26,400,000,000.0 due to continuous CapEx investments and capitalized leases, resulting in an EBIT of MXN 15,700,000,000.0 in the first half. Nonoperating charges for the period amounted to MXN $980,000,000, a reversal from the MXN $2.00 3,000,000 income recorded in the same period last year, mainly driven by higher interest expense and lower gain on tower sale and leaseback, tempered by the gain on dilution of share in Mint and stronger equity in affiliates. As a result, Globe’s net income for the first half reached COP 12,400,000,000.0, with core net income amounting to COP 10,400,000,000.0. On a sequential basis, the company was able to stage a strong rebound with consolidated gross service revenues inching 1% higher to MXN 40,300,000,000.0, aided by improving mobility and stronger digital engagement across segments. Operating expenses and subsidy declined by 1% quarter on quarter to MXN 19,000,000,000, resulting in a 3% expansion in Globe’s EBITDA to MXN 21,400,000,000.0.

Depreciation for the quarter ended at MXN 13,000,000,000, lower by 3% sequentially. This quarter’s non operating charges reached MXN 1,900,000,000.0, a reversal from the prior quarter’s income. Net income for the second quarter reached COP 5,500,000,000.0, while core net income, which strips out nonrecurring items such as gains from the Mint disposal, tower sale and leaseback and foreign exchange and mark to market adjustments posted a solid sequential gain, rising 30 to MXN 5,900,000,000.0 in the second quarter. Looking at our costs, our total operating expenses and subsidy declined by 3% year on year in the 2025. This was driven by an 894,000,000 peso reduction in staff costs, a 344,000,000 peso drop in marketing and subsidy, and the 267,000,000 peso decrease in services and other operating expenses.

These savings offset the increase in interconnect charges, up 10% year on year due to higher data roaming and a two p domestic SMS payouts, as well as a 194,000,000 uptick in network costs from higher lease, repair and maintenance expenses. As a result, Globe’s EBITDA stood at MXN 42,100,000,000.0 for the first half. On a sequential basis, total operating expenses and subsidy in the second quarter contracted by 1% to 18,900,000,000.0. While network costs rose by MXN $593,000,000 due to elevated repairs, maintenance, and administrative expenses, this was more than offset by cost savings across several areas. Interconnect charges dropped by 33,000,000, staff costs by 175,000,000, marketing and subsidy by EUR 6,000,000 provisions by EUR 162,000,000 and services and other OpEx by EUR $351,000,000.

These movements led to a 3% quarter on quarter increase in EBITDA, which reached 21,400,000,000.0 in Q2. Moving on to our balance sheet. Despite the complex macroeconomic environment, Globe maintained a healthy and stable financial position. Gross debt level was lower at 247,900,000,000.0 pesos as of end June twenty twenty five with unrestricted cash level at 19,300,000,000.0 pesos. Key financial ratios remained well within covenant limits.

Gross debt to EBITDA stood at 2.65 times, net debt to EBITDA at 2.44 times, and debt service coverage ratio at 3.12 times, underscoring the company’s disciplined financial management and strong balance sheet. As a result of the foregoing, Globe’s Board of Directors has approved the payout of MXN 25 per share. This is proof of Globe’s commitment to a sustainable dividend policy that is in line with our earnings and cash flow generation as well as to our commitment of delivering value to our shareholders. Key dates for this declaration are the payment date of 09/04/2025 to shareholders on record as of 08/19/2025. And finally, we would like to reinforce our consolidated outlook for 2025.

We are happy to report that while the year started off softer, Globe was able to turn this around and rebound in second quarter as reflected in our promising sequential performance. Therefore, we continue to guide low to mid single digit growth in service revenues, buoyed by the country’s push for digitalization and the ongoing trend of data habituation among the Filipinos. This outlook is underpinned by Globe’s resiliency and focus on providing the most consistent and reliable services to our customers. For our EBITDA margin, we are maintaining a guidance of 50%. And as stated earlier, Globe continues to move forward in its goal of strengthening its financial position while at the same time effectively optimizing its investments in critical infrastructure.

As such, we are reaffirming our major commitment of shoring up free cash flow enabled by our optimized capital deployment of less than 1,000,000,000 US dollars for the year. Globe, being disciplined and agile organization, continues to revisit and refine its guidance, ensuring that the company is well positioned to capture critical opportunities when and where it matters most. That ends the presentation. Thank you all for listening.

Jean Marie, Moderator/Host, Globe Telecom: Good morning to all. And again, thank you to all our guests for for coming over to listen to the latest developments that we have for for our company in the second half rather second quarter and first half. Aside from doing my usual spiel, I’ve been asked to add a few more minutes since you’re taking more time to set up the stage. You may have seen some of the slides earlier from SCT GBC. Sorry, sorry.

I I recall there was a colleague of ours who who said that when they were building the data center in Fairview, a lot of the residents, the nearby villages and towns were quite excited. Excited because they thought that they were gonna have their own IKEA. Could be SM as well. Good morning once again. As we prepare the stage for the Q and A session, we would like to introduce the management panel, who will be joining us shortly here on stage.

Of course, we have our President and Chief Executive Officer, Mr. Carl Cruz our Chief Financial Officer, Mr. Karl Lapuno our Chief Commercial Officer, Mr. Darius Elgado our General Counsel, Ecuaini Freeland Castello our Senior Vice President for Network Planning and Engineering, mister Joel Agustin our Senior Advisor for Broadband Business, mister Danny Teceira and our vice president and head of global business, miss Katie Dizon. And, of course, we also have our president and chief executive officer for SCT GVC, Carla Molana.

We’d also like to acknowledge the presence of Echtan Balco, our Vice President for Mobile Prepaid Business Eileen Seraci, our Vice President for Corporate Finance. We’ll now begin the Q and A session. Our first set of questions come from Ziwei Fu of Macquarie. And these are regarding GCash. So I guess Carlo will take a crack at the questions.

On GCash, could you share some color on what drove the strong growth in in 2Q ’twenty five? Which was a larger driver of the growth, payments or digital financial services? Thanks. Thanks for the question. I think it’s still the group is still quite broad based.

The it ranges from the increase in payments and transfers all the way up to the new business, particularly the wealth management. It’s given it’s adding to the it’s contributing to the to the growth. So I can’t we don’t really disclose the split, but it’s really across the board, we’re seeing some growth on the pipeline. Thanks for that. The second question is still staying on GCash.

Could you comment on growth trends for the rest of 2025 for both payments and digital financial services? Again, we don’t provide forward guidance. But I think there’s there’s confidence and there’s optimism not only on the shareholder level, but also on the management level. So there is significant opportunity for the Philippine market, especially as we expand some of the use cases to the new businesses. Thank you, Carlo.

The next set of questions come from Peter Garnasse of Uni Capital. The first question is on broadband. So this is for Danny. How much is the current port utilization of GLOO? And the second part is what proportion of the network could be monetized should the Connectado Filhoi bill be enacted?

Danny, Senior Advisor for Broadband Business, Globe Telecom: Thanks, Jamari. For port utilization, I would say we’re very happy, it’s healthy and comparable to operators in the region as well over the short period that also deploys fiber on its own versus national broadband network. Our strategy remains very clear on capital efficient to make sure we maximize our assets and put the ports where it matters to connect Filipino homes. For the second question on the KPA, we support okay. Sorry.

Go ahead.

Jean Marie, Moderator/Host, Globe Telecom: Will answer that. Thank you. On correct, Tarampino ID, the details actually are the implementing rules of regulations to be implement to be what do you call this? Implemented or drawn out by the DICT, assuring the bill as has passing too long. So we we do not know yet whether the DICT would place the new players in the Gida or the geographically isolate the disadvantaged areas or they would they be allowed in the the the urban areas.

So, yep, we do not know yet what’s gonna how this KP implemented rules would look like. Thank you, Danny and Antonio Freud. The next question is again on GCash. So I guess this is for Carlo. Can you provide the channel level transaction split specifically for online gambling rather?

What is your guidance on the possible impact of regulating or banning online gambling on GCash’s transaction volume? Again, we we don’t we don’t disclose the the split of GCash transactions just yet. But I think there there is still high optimism simply because the the top line is very diverse. So it is a broad based we have a lot of use cases. So I think there is confidence again on the shareholder and the management level that there’s sufficient opportunity in terms of expanding the use cases as well as introducing entering new businesses particularly for the enterprise as well as the international offerings of GCash.

So I think we’re seeing a lot of strong tailwinds for continued growth for for the company. Thank you, Carlo. And before we proceed to the next set of questions, I wish to correct myself. Earlier, I mentioned that Eric was the vice president for well, just to clarify, vice president for consumer mobile. My apologies.

So next set of questions is from Katrina Yap of Infocom. Katrina, if you don’t mind, we’ll take offline the first question that you asked and proceed to the next one. Regarding the 15 year on year increase for ICT related services, it was mentioned that the business applications contributed to this. Could you clarify where the demand is coming from in terms of industries and type of business applications? Katie, please.

Moderator, Globe Telecom: So I think some of the industries that we’re seeing the BaaS growing in are largely in FSI. We have also supply chain. In terms of the actual BaaS is growing, it’s largely API still and we’re seeing a

Jean Marie, Moderator/Host, Globe Telecom: lot of growth as well in productivity solutions. Thank Thank you, Katie. The next or the second part of that question is, can you also talk about the year on year developments for other segments, I. E, cybersecurity, cloud, etcetera? Can you

Moderator, Globe Telecom: by there’s growing and growing awareness in terms of security across the enterprises for security risks and because there’s increasing digitalization that we’re seeing across the security becomes more top of mind. It’s also a key focus area for Globe Business to take a very proactive stance in terms of driving cybersecurity so that the companies we service are actually very safe? Thank you.

Jean Marie, Moderator/Host, Globe Telecom: Thank you, Katie. There are currently no more questions in the queue at the moment. So we’ll now take questions from the floor. For those who would like to ask questions, please step forward to the mic and state your name and company before asking your question. Thank you.

And again, for those on Zoom, if you would like to ask follow-up questions, please send your questions to investorrelationsteam@globe.com.ph. Sir, you may now proceed. Hello.

Carl Cruz, President and Chief Executive Officer, Globe Telecom: Hi. This is Derek from CLSA. Just one question actually. Could you remind us how many towers are left to be sold and the timing for which and I guess the the cash consideration? Yeah.

Jean Marie, Moderator/Host, Globe Telecom: We still have the the full commitment was 7,500 plus towers. So we have around 550 towers left. So we we are endeavoring to try and deliver all of those within the year. Of course, we’re working with the with the different power goals to be able to actually execute those transactions. But the goal is to get them through this year.

Cash considerations will be close to around billion to 7,000,000,000.

Carl Cruz, President and Chief Executive Officer, Globe Telecom: Got it. Just a follow-up questions. Any more asset sales beyond towers in your horizon?

Jean Marie, Moderator/Host, Globe Telecom: I think now we’re we’re really looking at for now, we’re we’re taking a pause. I think in terms of the tower sale, we’re done at 7,500. There are still a lot of assets left, but we wanna make sure that we go we move forward with the right type of strategy. So for example, is straight out asset sale the right strategy moving forward, particularly given a lot of the assets left are quite strategic from from our perspective. So we’re looking at all of the different structures available to us to be able to monetize those assets.

But I think what’s key for us now is keeping a lot of those operational and strategic control for the remaining assets. So we we will make the the right type of disclosures when we do decide. But for now, we’re we’re we’re stopping at

Darius, Executive, Globe Telecom: the 7,500. Okay. Thank you so much.

Jean Marie, Moderator/Host, Globe Telecom: Thank you for that. Are there any other questions from the floor? Hi. I’m Greg from BPI. So I just wanted to know management’s view, particularly on the GCash side on the with regards to the competitive landscape on online lending.

I’m seeing a lot a lot of ads from other players like One Hand or maybe Maia. So I’m just wondering, is it more competitive these days? And then what’s the growth outlook looking like for online lending and transfers as an industry as a whole? So just so we can get a sense of where the growth of GCash would be, I guess, moving forward. I think on the on the transfer side, we still are seeing a lot more growth.

I think operating metrics have continued to actually increase. Lending likewise is also still increasing. We are seeing more growth on some of the new businesses. So insurance, data tech, ad tech, all of those are actually starting to contribute to the top line. In terms of how competitive it is on the lending side, I think you’re seeing a lot of these lending apps pop in and out.

I think the view there the view really is that the safer option is still with the safer and the cheaper option is still with GCash, particularly given the the robust controls that we have and the way we we have in terms of the our compliance to regulation. So our view is that you will see a lot of these come and go. But the lasting the lasting service, particularly for those micro loans, will remain with GCash. I guess and then my last question will be for you, sir Carl. What’s the I guess, what’s your sort of long term vision for Glo given that you have already taken over the position, I guess, for a couple of months now?

Carl Cruz, President and Chief Executive Officer, Globe Telecom: I think we’ve made that very clear. The vision is to be the most valuable, most profitable and most admired operator in the country. So that’s the overlying vision mission for Globe. The North Star will continue to be the customers. We truly believe that a key differentiator for us to win in this particular market is to keep on elevating customer experience and of course loyalty.

So that’s the direction moving forward.

Jean Marie, Moderator/Host, Globe Telecom: Thank Greg. Are there any more questions from our guests here? Okay. Well, moving back to the questions from those joining us virtually. The next question is from Paulo Manansala of Call Financial, if I’m not mistaken.

This is for Darius. Any clarity on the weakness in mobile with regards to lower ARPU year on year? Is there a trend being seen in the user base? And are there any initiatives to address this? So two things.

So you can view it first on year on

Darius, Executive, Globe Telecom: year and then let’s view it on the other hand quarter on quarter where we see or have demonstrated the momentum that we see will continue in q three. So in year on year, there’s a lot of macroeconomic headwinds in the past, which actually impinge the capabilities of customers to really spend more on telco. And what we’ve seen also is that given that kind of economic landscape, they spend less in telco in general, but they still spend enough. And so what we’re trying to do on the mobile side, for example, even for broadband or total b two c is that they have to be the greatest in portfolio economics to make sure that the customers really upsell or trade up their spend in with with Globe. And that’s what we’ve seen in quarter two.

And we’ve seen it also happen and get sustained in July. So there’s really solid momentum going in. It’s the same for broadband too. At the same time, we have been differentiating ourselves in the market in terms of hyper personalization. Gone were the days where we just sell mainstream offers.

We have a a set of robust information that’s dynamic on the part of customer usage, the quality of the supplier, which is the network experience, etcetera. And proact in terms of serving the right offer at the right moment even though the customers don’t even ask for it. And that’s how we grew mobile and even broadband in quarter two. And we’ve seen greater strides going into quarter three, which what our July performance so far is evident of. Thirdly, and equally important is the need to deliver the best customer experience, which fundamental to that is actually the network.

We pride ourselves to be the most consistent mobile network in the last nine quarters. And it continues to also increase our NPS or Net Promoter Score amongst our customers and we see them directly correlated into the top ups or in the results that we see on a month on month basis. And we continue this kind of a formula. We tweak in there as we go so that we keep on improving the upsells, we keep on improving the engagement with our customers. As you have seen, we have been able to grow fume base by 1% driven by 2% increase in the prepaid segment.

Although it’s highly competitive, we’re able to increase the base by 2%. You look at look at our churn rates, they’re consistent quarter on quarter to quarter two. We even improved it a bit in the on the postpaid side. You look at postpaid net adds, we have better net adds substantially in Q2 versus Q1. You look at our net adds on prepaid, they’re more they’re almost 30% increase quarter on quarter.

So however, which way you look at it across all of the financial indicators, they all lead to 2% revenue increase quarter on quarter, and it’s driven by the factors and the initiatives that I’ve earlier mentioned. So yes, on year on year, that’s no longer an excuse now. We have seen the formula working as we serve our customers better and more deeply knowing them best, which is what we do best in Globe. We see the results and that’s why Q2 is like this.

Jean Marie, Moderator/Host, Globe Telecom: Thank you, Darius. Next set of questions come from Armando Lapas of Metro Bank. The first question is on mobile. What are you seeing in terms of competition for mobile data? Number

Darius, Executive, Globe Telecom: one, we’re we are the leader in mobile data and we know the formula again of how to habituate more customers to data. And you’ve seen that across the movements in our mobile services, across SMS, voice, and data, where there’s a lion’s share of data already, more than 90% of total revenues in mobile. And we see a shift from SMS and traditional voice to MDS usage because through MDS, you can also call and message. We endeavor to maintain that leadership because we know the formula. And it it is a combination of making sure that our network experience is worthy of our customer spend.

At the same time, we should know best how to habituate our customers in India. Competitive landscape, it hasn’t been changed substantially from the last three quarters or so. So I think we’re okay.

Jean Marie, Moderator/Host, Globe Telecom: Thank you, Darius. The next question is again on mill. So I believe this is for Carlos to pick a trap one. Is there an updated timeline for Mint’s plan IPO? What factors is it contingent on?

Well, at this point, I think there there is still no definite plans. We’re we can we continue to to monitor the the market, all of the external trends to make sure that when we do go to market, we do get the right type of value and we unlock the the fair value of the company. We will we will disclose to the to the market if and when there are developments on this front. But I think the what the what the company is doing now is continuing its effort to be push button ready so that when it is time and the board and all of the other shareholders deem it’s time, we can execute quickly. Thank you, Carlo.

The next question is on staff cost, but I think it’s something you can take offline. If you don’t mind, Herman. The next question is actually it’s housekeeping. How do we reconcile core versus normalized income? I think it’s just forex.

It’s just a difference on the the forex. Yeah. I think we we can take it off of Yeah. Yeah. Thanks, Arman, for your questions.

This point again, we’d like to ask our audience here if you have any questions for the panel. And since there are no further questions in the queue, this concludes the Q and A portion. And before we adjourn, we will now turn over the floor to Karl for his closing remarks.

Carl Cruz, President and Chief Executive Officer, Globe Telecom: Thank you, Jean Marie. So first of all, thank you for joining us today. I think we’re quite pleased with our performance in the second quarter, which to my mind and to our minds clearly signals a very strong sequential recovery quarter on quarter. And this particular growth is really anchored on robust data growth now about 86% of our mobile business. And of course, not forgetting our resilient core businesses, really despite the challenging macroeconomic environment.

So quite pleased with that. And the turnaround really in a way shows stability and solid footing for the company for Globe with which the second half of the year can really build on and build upon. So operational intensity is now improving and we’re starting to see very good input metrics moving in the right direction, which will surely help our performance in the second half of the year. So that’s it for us today. Thank you so much again for joining us, and I hope you do enjoy lunch that’s going to be served very soon.

Thank you.

Jean Marie, Moderator/Host, Globe Telecom: Thank you, Carl. And on that note, we conclude the second quarter twenty twenty five analyst briefing of Blob Telecom. We should thank again all of you who joined us here and in the call. We hope you’ll join us again for our third quarter twenty twenty five analyst briefing in early November. Again, we wish everyone a pleasant good morning.

Stay safe, everyone. Goodbye.

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