Globe core net profit down 8 percent to P11.7B as of September

Declining prices of mobile internet services amid tough competition contributed to the decline in the core net income of Globe Telecom in the first nine months by 8 percent to P11.7 billion.

The drop in reported net income, which includes depreciation and non-operating charges relating to the acquisition of San Miguel Corp.’s telco unit on May 30, was larger at 17 percent.

Globe’s profit drop in the third quarter alone was 50 percent to P2.7 billion.

Rival PLDT, on the other hand, is set to disclose third quarter and nine-month results on Nov. 10.

“Demand continues to be high, but pricing has been low in the main growth area, which is data,” Globe CEO Ernest Cu said in a media briefing on Monday. “As long as that pricing continues to go down, most players will continue to have difficulties in that regard.”

Service revenues during the nine-month period rose 7 percent to P89.1 billion. Mobile data accounts for 38 percent of Globe’s mobile revenues. This area fell 7 percent to P8 billion in the third quarter due to “market aggression.”

Globe noted in a presentation that mobile data prices had come down 86 percent since the start of 2016.

Cu said P50 can get Globe subscribers 1 Gigabyte of data while subscribers of main rival PLDT get 1.3 GB.

Cu said lower prices signaled there was competition in the telco sector, despite the fact that PLDT and Globe together already control about 80 percent of all available telco frequencies after the SMC deal.

“Contrary to what some people perceive, competition between PDLT and Globe continues to intensify,” he said.