Telecom Argentina Reports Robust Financial Growth in Q2 2025

Telecom Argentina has reported strong financial growth as of June 2025, with increased current and non-current assets compared to December 2024. This reflects growth in trade receivables and investments, strengthening the company's financial position and enhancing market competitiveness. Analysts rate the stock as a Hold with a $13.00 price target, while Spark's AI Analyst considers it a Neutral investment option due to solid financial foundations, moderate valuation, and a reasonable dividend yield.

Telecom Argentina (NYSE:TEO) announced its consolidated results for the first half of 2025 (1H25), reflecting a complex financial picture marked by significant growth and integration challenges. The company reported a net loss of P$75,554 million, contrasting sharply with the P$1,197,930 million profit in 1H24. This reversal was primarily driven by unfavorable net financial results, though partially offset by improved operating performance and lower income tax expenses.

Consolidated revenues reached P$3,357,004 million, representing a substantial 44.4% year-over-year increase. However, this growth primarily stems from the acquisition of Telefónica Móviles Argentina (TMA), which was consolidated for four months during the reporting period. Standalone operations (excluding TMA) grew 3.8% in real terms compared to 1H24, a notable improvement from the -11.7% decline seen in the previous comparable period. Meanwhile, TMA's service revenues increased 7.5%.

Operating income before depreciation, amortization, and impairment reached P$1,007,153 million, yielding a margin of 30.0% – a modest 0.3 percentage point improvement year-over-year. Customer metrics show varied performance across segments. In mobile services, Telecom's standalone operation saw a 1.3% decline in subscribers to 20.9 million, though postpaid customers increased 1.1%. TMA's mobile base grew 2.5% to 19.3 million. Fixed broadband showed more consistent growth, with Telecom and TMA increasing their subscriber bases by 1.5% and 6.0% respectively. Pay TV results were mixed, with Telecom gaining 2.3% more subscribers while TMA lost 6.1%.

The acquisition of TMA has significantly altered Telecom Argentina's financial structure, with consolidated net financial debt reaching P$4,029,971 million, representing a 38.2% increase in real terms compared to December 2024. This substantial debt increase reflects the financing required for the TMA acquisition, which will be a key factor to monitor in future periods. ARPU (average revenue per user) metrics showed improvement across services, with mobile ARPU for Telecom increasing 12.6% in real terms, broadband ARPU up 6.3%, and pay TV ARPU rising 5.3%.

Capital expenditure was disciplined at 14.3% of consolidated revenues, suggesting a measured approach to network investment while managing the integration costs of TMA.

Analysts rate the stock as a Hold with a $13.00 price target, while Spark's AI Analyst considers it a Neutral investment option due to solid financial foundations, moderate valuation, and a reasonable dividend yield.

References:
[1] https://www.stocktitan.net/news/TEO/telecom-argentina-s-a-announces-consolidated-results-for-the-first-kpi4dogqqcfr.html