PLDT's Q3 2025 Earnings Call: Contradictions Emerge on Regulatory Risks, Mobile Data Performance, Asset Monetization, Maya's Profitability, and ARPU Growth Strategies

Date of Call: November 11, 2025

Financials Results

• Revenue: Consolidated service revenues PHP 145.9B (9M), up 1% YOY; Q3 service revenues PHP 48.8B, up 2% YOY (excluding legacy +4% for Q3 / 9M ex-legacy +3%)

Guidance:

• Full-year 2025 CapEx guidance lowered to PHP 60 billion (from original PHP 68–73B).
• PLDT expects to reduce net-debt-to-EBITDA to ~2.0x in ~3–4 years via asset monetization and lower CapEx.
• Positive free cash flow achieved as of Sept 2025 and target to sustain into 2026 supported by monetization program.

Business Commentary:

• Revenue and EBITDA Growth:
• PLDT reported service revenues of PHP 145.9 billion for the first 9 months, up 1% year-on-year, with EBITDA rising 3% to PHP 82.8 billion.

• The growth was driven by steady demand across fiber, data, and ICT, along with lower operating costs.

• Fiber and Data Segment Performance:

• Home revenues grew 4% year-on-year to PHP 45.7 billion, with fiber revenues up 7% to PHP 44.5 billion.

• This performance was attributed to the addition of 265,000 net fiber subs and a shift towards high ARPU prepaid fiber subscriptions.

• Maya's Profitability and Expansion:

• Maya's core net income reached PHP 603 million for the period, marking a PHP 1.5 billion turnaround from last year's loss.

• The improvement was due to growing transaction volumes, deposits, and loans, as well as the launch of new products like the Maya Black credit card and personal loans.

• Enterprise Segment Recovery:

• Enterprise revenues remained steady year-on-year at PHP 35.6 billion, with corporate data and ICT revenues up 2% to PHP 26.7 billion.
• This recovery was driven by government and public sector projects ramping up, despite initial delays.

Sentiment Analysis:

Overall Tone: Positive

• EBITDA rose 3% to PHP 82.8B with margin steady at 52%; consolidated service revenues up 1% YOY to PHP 145.9B; Maya profitable for third consecutive quarter; PLDT achieved positive free cash flow as of Sept 2025 and lowered FY25 CapEx guidance to PHP 60B.

Q&A:

• Question from Nicky Franco (Abacus Securities): Given that Maya's lending was still strong in 3Q '25, what were the main drivers for the drop in net income for the period? Were there any one-offs that were attributed to this?
  Response: Management: Drop driven by removal of gaming-related revenues (per BSP) and higher provisioning from scaling new, longer-duration credit products (Maya Black card and personal loans).

• Question from Arthur Pineda (Citigroup): With regard to the KPA and the IRRs, how do you see this impacting your profitability and investment profile? Second, mobile has been trailing your competitor — what's driving the difference? Third, enterprise saw an uptick in government projects — is this sustained into Q4 given weaker macro momentum?
  Response: Management: IRR impacts are uncertain and concerning (no build or service obligations), mobile is stabilizing via higher-quality subs and improved ARPU from targeted acquisition, and enterprise momentum from govt projects is expected to continue into Q4 and early next year.

• Question from Ranjan Sharma (JPMorgan): How will wholesale access pricing be set when incumbents are asked to open networks — commercial terms or a cost model? Also, spectrum management provisions include clawback for underutilized spectrum — how might that impact the industry?
  Response: Management: No specific pricing model in the IRR — incumbents submit reference offers for regulator review; pricing and 'significant market player' scrutiny remain unclear; spectrum underutilization standards are undefined and impacts are uncertain pending stakeholder consultation.

• Question from [indiscernible] (Conference Participant): You mentioned reducing net-debt-to-EBITDA to 2x — which year is this expected? Also net debt is rising faster than net profits; where is the debt going?
  Response: Management: Target ~2.0x in roughly 3–4 years; current net-debt increases reflect investment in network/IT rollout, data center development and some refinancing, with asset monetization and lower CapEx to support deleveraging.

• Question from John Te (UBS): Fixed broadband net adds were strong (95k vs ~70k H1 run-rate) — how much was prepaid vs postpaid and what drove the acceleration? Follow-up: the PHP 2+bn accelerated depreciation and higher interest expense — causes?
  Response: Management: Net-add acceleration driven by higher install rates and targeted expansion (prepaid grew >3x but majority still postpaid); accelerated depreciation from retirement of legacy assets and IT/core modernization recorded in Q3; interest rose due to higher average rate (+49bps) and ~PHP19B higher average borrowings.

• Question from Tony Watson (Conference Participant): Any thoughts you can share on a potential Maya IPO or spin-off?
  Response: Management: No comment on IPO timing; shareholders would lead any decision — management remains focused on execution and scaling the business.

Contradiction Point 1

Impact of Konektadong Pinoy Bill and Regulatory Environment

It involves the company's perspective on the potential impact of the Konektadong Pinoy Bill on its profitability and investment profile, which is crucial for investors to understand the regulatory risks and uncertainties.

How will KPA and IRR affect your profitability and investment profile? Are new revenue opportunities outweighing risks? - Arthur Pineda (Citigroup Inc., Research Division)

2025Q3: The impact is not clear yet as the IRR does not impose infrastructure obligations on new entrants. - Marseille Nograles(IR)

Can you provide an update on the Konektadong Pinoy Bill and the presidential decision deadline? - Arthur Pineda (Citigroup Inc. Exchange Research)

2025Q2: If the President does not return the bill by August 24, it will become a law by the passage of time. - Joan A. De Venecia-Fabul(CLO)

Contradiction Point 2

Mobile Data Performance and Market Strategy

It highlights the differing perspectives on the company's mobile data performance and its strategy to address the gap with competitors, which is essential for investors to assess the company's competitive position and strategic direction.

What is causing the underperformance of mobile data compared to competitors? - Arthur Pineda (Citigroup Inc., Research Division)

2025Q3: Mobile data has trailed the competitor. What's driving this difference in performance? - Arthur Pineda(Citigroup)

What is causing the wireless revenue softness? Is there revenue growth in the third quarter? - Arthur Pineda (Citigroup Inc. Exchange Research)

2025Q2: The dip is a normal fluctuation, and we expect it to go right back up. - Anastacio Roy Martirez(CMO)

Contradiction Point 3

Asset Monetization and Strategic Goals

It involves the company's progress and strategies in asset monetization, which is crucial for understanding the company's financial health and capital management.

Any updates on asset monetization programs, including the data center stake sale and copper sales? - Ranjan Sharma (JPMorgan Chase & Co, Research Division)

2025Q3: We're currently in talks with an investor for a 49% stake in our data center. - Danny Yu(CFO)

Will loan disbursement growth in H2 2025 outpace GCash? - Zhiwei (Macquarie)

2025Q2: We'll continue to explore strategic alternatives for the data center. - Blums Pineda(CIO)

Contradiction Point 4

Maya's Profitability and Financial Performance

It involves differing explanations for Maya's financial performance, which is crucial for understanding the subsidiary's growth and sustainability.

What drove the net income decline in 3Q '25 despite strong lending? - Nicky Franco(Abacus Securities)

2025Q3: The slight drop in net income was due to the removal of gaming links by the BSP and the introduction of longer duration loans, like the Maya Bank Black Credit card, resulting in excess provisions impacting the near to medium term. - Aayush Jhunjhunwala(CEO)

How did Maya achieve Q4 profitability, and what are expectations for 2025? - Zhiwei Foo(Macquarie)

2024Q4: Maya's profitability is due to strong payments and banking business, and effective cross-selling. Cost optimization and efficient service have driven growth. The focus remains on scaling products profitably, while maintaining cost discipline. - Aayush Jhunjhunwala(CIO)

Contradiction Point 5

Customer Retention and ARPU Growth Strategies

It highlights differing strategies and approaches to customer retention and ARPU growth, which are critical for PLDT's competitive positioning.

Why is mobile data lagging behind competitors? - Arthur Pineda(Citigroup Inc., Research Division)

2025Q3: While being behind in revenue, Smart has achieved flattish growth rate year-to-date versus Globe. Growth in Q3 was ahead of Globe, and Smart's ARPU improved to positive 2.5%. We've secured higher quality subscribers through targeted marketing and investments in 5G devices. - Marjorie C. Garrovillo(CMO)

How did PLDT increase Mobile ARPU in Q4 as peers declined? - Zhiwei Foo(Macquarie)

2024Q4: Innovative sales and marketing, 5G network rollout, and affordable 5G devices. Experience-based monetization is key to increase ARPU. - Boy Martirez(CMO)