Globe sees recovery signs, puts capital expenditures into broadband business

A logo of Globe Telecom is seen at a Globe service center in Edsa, Quezon City, Metro Manila. (Picture taken on May 7, 2018 by REUTERS/DONDI TAWATAO)

Globe Telecom Inc., which booked record high service revenues in the past year, is optimistic about the potential growth opportunity in its home broadband business this year after seeing some signs of recovery.

Juan Carlo Puno, the newly-minted chief financial officer of the telco giant, said in a virtual briefing on Friday that they were channeling some of their capital expenditures to the broadband business.

This is “because we are seeing a lot of signs given the growth in the fourth quarter,” he explained.

Broadband revenues rose by 2 percent in the fourth quarter.

Subscriber base, meanwhile, grew 3 percent in the same period from the previous quarter.

Home broadband subscriber count was at 1.74 million last year, down from 1.75 million in 2023.

Full-year revenue for this segment also dropped by 5 percent to P23.8 billion as more customers transitioned to fiber services, which registered a 2-percent uptick in revenues and 16-percent growth in subscriber base.

“Competition is indeed tight in the broadband space,” observed Globe vice president and head of brand management for the broadband business Abigail Cardino.

“But as you can see in our performance, we have demonstrated that with the right offer, right service experience that truly delight our customers, there is still that growth potential,” she said.

This year, Globe is set to spend capex below $1 billion, bulk of which is allocated to meet its data requirements.

Globe saw its net income dip by 1 percent to P24.3 percent last year due to fewer cash inflows from proceeds of its tower asset sale and higher depreciation expenses.

However, its total service revenues grew 2 percent to a new record of P165 billion last year, thanks to increasing use of data for both mobile and corporate clients.

Mobile data revenues were up 7 percent to P97.4 billion last year while corporate data saw its contribution jump by 11 percent to P20.4 billion.

Financial technology arm Mynt, which operates GCash, contributed equity earnings of P3.8 billion last year, showing 59-percent growth from 2023.

Last year, Globe spent P56.2 billion in capex to build up its infrastructure.

It constructed 1,212 new cell sites, upgraded 4,613 existing mobile sites and deployed 67,456 fiber-to-the-home lines.

The telco giant also added 587 new 5G sites across the country.

It now has 98.6 percent coverage in Metro Manila and 96.9 percent coverage in key cities of Visayas and Mindanao.

“By prioritizing network enhancements, pioneering digital innovations, and fortifying our core telco business, we are well-positioned to expand our market presence and create greater value for our stakeholders,” Globe President and CEO Ernest Cu said.