Churn, Profitability, and CapEx: Contradictions Unveiled in 2025 Q2 Earnings Call

Strategic Acceleration and Financial Performance:
- Millicom International Cellular reported $218 million in equity free cash flow for the quarter and a total of $395 million for H1, up nearly $126 million from the previous year.
- The company executed strategic milestones, including acquisitions and infrastructure transactions, and declared a special interim dividend of $2.5 per share.
- The significant financial performance was attributed to disciplined execution and strategic focus on operational and commercial fronts.

Mobile and Home Business Growth:
- The mobile business grew by mid-single digits, with prepaid ARPU increase and postpaid customer base growing by 14%, reaching near 9 million customers.
- The Home business added 41,000 customers, nearly 4x more than the previous year, with broadband customer base up roughly 8%.
- This growth was driven by strategic playbooks focusing on network scaling, targeted capital deployment, and convergence across mobile and fixed services.

Leverage and Financial Targets:
- Millicom's leverage dropped to 2.18x, maintaining a commitment to keep leverage below 2.5x.
- The company reiterated its 2025 financial targets, with equity free cash flow of around $750 million and year-end leverage below 2.5x, which includes strategic M&A impacts.
- The achievement of these targets reflects strong cash flow generation and disciplined financial management.

M&A and Geographic Expansion:
- Millicom completed the acquisition of Telefónica's Uruguay operations and reached agreements for Telefónica Ecuador, with approvals expected in Q3 and Q4.
- The company is actively pursuing other strategic opportunities, such as discussions with EPM in Colombia and Coltel, with anticipated closing in Q1 2026.
- These moves indicate Millicom's commitment to strategic expansion in South America, aiming to enhance its footprint and shareholder value.