Liberty Latin C 2025 Q1 Earnings Misses Targets as Net Income Drops 25240%
Wednesday, May 7, 2025 11:59 pm ET
54min read Liberty Latin C (LILAK) reported its fiscal 2025 Q1 earnings on May 07th, 2025. Liberty Latin America's earnings fell short of expectations, with a substantial decline in net income and a withdrawal of its mid-term outlook due to underwhelming mobile growth. The company continues to focus on cost reduction and operational efficiencies to enhance Adjusted Free Cash Flow. Despite the challenges, Liberty Latin America remains committed to improving its operational momentum.
Revenue
The total revenue of Liberty Latin C decreased by 1.4% to $1.08 billion in 2025 Q1, down from $1.10 billion in 2024 Q1.
Earnings/Net Income
Liberty Latin C maintained stable EPS at $-0.69 in 2025 Q1 compared to 2024 Q1. Meanwhile, the company's net loss widened to $-126.70 million in 2025 Q1, representing a 25240.0% increase from the $-500000 loss recorded in 2024 Q1. The consistent EPS suggests ongoing challenges in achieving profitability.
Price Action
The stock price of Liberty Latin C has edged up 0.18% during the latest trading day, has edged up 1.09% during the most recent full trading week, and has edged down 0.00% month-to-date.
Post-Earnings Price Action Review
The strategy of investing in Liberty Latin America (LILAK) shares following a quarterly revenue decline and holding for 30 days has historically delivered a 16.64% return over the past five years. This performance is notably lower compared to a benchmark return of 84.08%. The strategy's compound annual growth rate (CAGR) stood at 3.14%, with a maximum drawdown of -15.31%. The Sharpe ratio, measuring the risk-adjusted return, was 0.28, indicating moderate risk and returns. Despite the lower return relative to the benchmark, the strategy has shown potential for gains, albeit with a degree of risk that investors should consider.
CEO Commentary
Balan Nair, CEO of Liberty Latin America, highlighted that the company added over 40,000 broadband and postpaid mobile subscribers in Q1 2025, marking a significant increase of over 50% from the previous quarter. He emphasized the importance of Fixed-Mobile Convergence (FMC), achieving over 30% penetration in key markets, which substantially contributed to performance. Nair noted that the commitment to network upgrades and spectrum acquisitions has positively impacted financial results, with operating income rising 38% year-over-year. Despite challenges in 2024, he expressed optimism about the recovery path in Liberty Puerto Rico and the focus on cost efficiency while managing capital intensity.
Guidance
Liberty Latin America has withdrawn its mid-term outlook for 2024-2026 due to slower-than-expected mobile growth. The company expects to continue emphasizing cost reduction and operational momentum. While specific quantitative targets were not provided, the focus remains on enhancing Adjusted Free Cash Flow and maintaining improvement in operational efficiencies.
Additional News
In February 2025, Liberty Latin America's largest credit silo, Cable & Wireless (C&W), successfully completed a $3.3 billion refinancing program. This included the issuance of $755 million in senior notes due 2033 with a 9.0% coupon, which will be used to redeem existing notes due 2027. CFO Chris Noyes remarked that the refinancing extends C&W’s maturity profile to approximately 6.5 years, highlighting the company’s ability to efficiently access capital markets. Additionally, Liberty Latin America operates in over 20 countries, providing a wide range of communication services under brands such as BTC, Flow, Liberty, and Más Móvil, further strengthening its market presence.
Revenue
The total revenue of Liberty Latin C decreased by 1.4% to $1.08 billion in 2025 Q1, down from $1.10 billion in 2024 Q1.
Earnings/Net Income
Liberty Latin C maintained stable EPS at $-0.69 in 2025 Q1 compared to 2024 Q1. Meanwhile, the company's net loss widened to $-126.70 million in 2025 Q1, representing a 25240.0% increase from the $-500000 loss recorded in 2024 Q1. The consistent EPS suggests ongoing challenges in achieving profitability.
Price Action
The stock price of Liberty Latin C has edged up 0.18% during the latest trading day, has edged up 1.09% during the most recent full trading week, and has edged down 0.00% month-to-date.
Post-Earnings Price Action Review
The strategy of investing in Liberty Latin America (LILAK) shares following a quarterly revenue decline and holding for 30 days has historically delivered a 16.64% return over the past five years. This performance is notably lower compared to a benchmark return of 84.08%. The strategy's compound annual growth rate (CAGR) stood at 3.14%, with a maximum drawdown of -15.31%. The Sharpe ratio, measuring the risk-adjusted return, was 0.28, indicating moderate risk and returns. Despite the lower return relative to the benchmark, the strategy has shown potential for gains, albeit with a degree of risk that investors should consider.
CEO Commentary
Balan Nair, CEO of Liberty Latin America, highlighted that the company added over 40,000 broadband and postpaid mobile subscribers in Q1 2025, marking a significant increase of over 50% from the previous quarter. He emphasized the importance of Fixed-Mobile Convergence (FMC), achieving over 30% penetration in key markets, which substantially contributed to performance. Nair noted that the commitment to network upgrades and spectrum acquisitions has positively impacted financial results, with operating income rising 38% year-over-year. Despite challenges in 2024, he expressed optimism about the recovery path in Liberty Puerto Rico and the focus on cost efficiency while managing capital intensity.
Guidance
Liberty Latin America has withdrawn its mid-term outlook for 2024-2026 due to slower-than-expected mobile growth. The company expects to continue emphasizing cost reduction and operational momentum. While specific quantitative targets were not provided, the focus remains on enhancing Adjusted Free Cash Flow and maintaining improvement in operational efficiencies.
Additional News
In February 2025, Liberty Latin America's largest credit silo, Cable & Wireless (C&W), successfully completed a $3.3 billion refinancing program. This included the issuance of $755 million in senior notes due 2033 with a 9.0% coupon, which will be used to redeem existing notes due 2027. CFO Chris Noyes remarked that the refinancing extends C&W’s maturity profile to approximately 6.5 years, highlighting the company’s ability to efficiently access capital markets. Additionally, Liberty Latin America operates in over 20 countries, providing a wide range of communication services under brands such as BTC, Flow, Liberty, and Más Móvil, further strengthening its market presence.
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