PLDT Inc.

I'm Jingay Nograles, Head of Investor Relations here at PLDT. It's my pleasure to welcome you to our first quarter financial and operations results briefing. Joining us today to share insights into PLDT's performance and strategic direction are Smart Communications Chief Operating Officer, Boyne Marguerite, PLDT Chief Operating Officer, Jimenez Jr., PLDT Chief Financial Officer, Mr. Danny Yu, PLDT Victorino Aquino, PLDT Chief Legal Counsel, Attorney Joan Davinesa-Cabo. Before we begin, I'd like to remind everyone that we will have a Q&A session after the presentation. You may submit your questions via MS Teams Q&A panel, or you may also raise your hand and we will unmute you at that time. To start, I'd like to invite our CFO, Mr. Danny Liu, to walk us through PLDT's financial performance for the first quarter.

Good afternoon, everyone. Allow me to present PLET's first quarter performance covering key results and business highlights. Our net service revenue is slightly up year-on-year. On gross basis, our revenue reached $53.4 billion, up 2% from last year. EBITDA grew by 2% to $27.9 billion, driven by continued strength in our Fiverr and iTunes. with prudent cost management. Telco core income was recorded at $8.8 billion, down 6% year-on-year, reflecting increased depreciation linked to recent strategic investment in network infra, coupled with related financing costs. Core income was steady at $8.9 billion, driven by Maya's positive earning contribution as it turned profitable this quarter. As we move forward, we will continue to pursue steady revenue growth, disciplined expense management, asset monetization, and prevent capital allocation. OBT's net service revenue growth reflects stable demand across our key business segments, mobile data, fiber, corporate data, and ICT. Starting with home, revenue rose by 4% year-on-year to $15.2 billion thanks to continued Fiverr demand. Fiverr now accounts for 97% of home revenues, up from 92% in 2024 as we steadily migrate legacy subscribers. In enterprise, total revenue remained steady at $11.9 billion year-on-year, with a slight 1% uptick in corporate data and ICT revenues. Within this segment, ICT stands out, going 16% year-on-year to 2.2 billion, now accounting for over 22% of enterprise revenues, up from 19% a year ago. Although our connectivity business is navigating a transitional phase, we are actively building a pipeline of new opportunities by leveraging our emerging technologies. Lastly, on mobile, revenues were down slightly at 21.3 billion due to lower packet Wi-Fi usage as customers shifted to smartphone or fixed data access. Some prepared packages available in the first quarter of 2024 were also adjusted, leading to less headline growth but better fundamentals. We're also encouraged by rapid 5G adoption, and a steady rise in data traffic, which point towards improved monetization and growth moving forward. Mobile data, fiber, corporate data, and ICT, which now account for 89% of total revenues from 88% in 2024, continue to expand, offsetting legacy revenues declines. Excluding legacy services, net service revenues grew by 2%, Now, let's take a closer look at home segment. Home revenue rose 4% year-on-year, reaching $15.2 billion. This growth was mainly driven by fiber, which posted a healthy 7% increase to $14.7 billion. Our shift from legacy to fiber is progressing well, with fiber now representing 97% of total home revenues, up significantly from 92% in 2024. We also added 101,000 new subscribers this quarter compared to negative net additions a year ago. This improvement came from stronger network coverage and expanded port availability from recent investments. R2 remained stable at around 1,493, reflecting our success in bundling high-value products. while managing churn effectively. Our churn rate of less than 2% remains among the lowest in the industry. Looking ahead, we will continue to expand our fiber footprint with targeted initiatives and diversified offerings. Turning now to enterprise, the unit delivered steady results with total revenues at 11.9 billion. corporate data and ICT, on the other hand, improved by 1% to 8.8 billion. This growth was tempered by the impact of lost Pogo connectivity as the industry shut down last year. With that said, ICT business continues to perform well, growing at 16% compared to the same period last year. Managed IT services expanded 101%, cybersecurity services rose by 69%, credit scoring climbed by 48%, and data center co-location revenues jumped 37%. As a result, ICT now makes up over 22% of our enterprise revenues, going to 19% a year ago. We're working on new opportunities, leveraging our investments in advance. Hello, hello. centers network application programming and ai drivers additionally the recently activated asia directly further strengthens our competitive advantage enhancing international capacity and network resilience for enterprise customers turning to the individual segment Total revenues came in at 21.3 billion, down slightly by 1% year on year, as we continue to see customers shift away from packet Wi-Fi towards smartphone-based data usage. Mobile data revenues, on the other hand, were stable at 18.8 billion, impacted partially by the termination of long validity offers that front-loaded revenues in the first quarter of 2024. Despite relatively flat revenues, underlying trends remain encouraging. 5G data traffic surged 81% year on year. 5G device adoption also showed robust growth up 60% quarter on quarter. The ongoing shift to 5G has significantly improved our network efficiency and freed up additional LTE capacity resulting in a better overall customer experience. We expect this increased 5G adoption and improved network efficiency to help stabilize revenues and drive future growth in the individual segment. PLDT delivered $27.9 billion in EBITDA for the first quarter of 2025, a 2% increase year-on-year, demonstrating our ongoing efforts in managing costs while maintaining a resilient revenue base. OPEX, including subsidy and provisions, declined by $300 million to $86.1 billion, reinforcing operational discipline. Our in-built-in margin remained strong at 52%. Telco core income was at $8.8 billion, lower by 6% year-on-year, mainly due to increased depreciation from network expansion and associated financing costs. Our core income, on the other hand, held steady year-on-year at $8.8 billion, supported by Maya's positive contribution. A key highlight this quarter is Maya turning profitable, marking a significant milestone. Maya contributed $127 million in net income, a clear turnaround from prior year's losses, powered by robust loan growth strong momentum in deposits, and increased payment volume. Now let's move on to CAPEX and our debt profile. For the first quarter of 2025, our CAPEX stood at $10.8 billion, lower compared to last year, resulting in a reduced CAPEX intensity of 20%. This lower spend is partly due to timing, as a significant portion of our project for 2025 is adjusted slightly to 68% to 74% in the priority areas, plus LTE and 5G upgrade, plus LTE and 5G upgrade, plus LTE and 5G upgrade, as well as upgrade and modernization of network and IT to improve our quality of service. While we work on decreasing capex, we are committed to deliver greater outcomes through efficient use of capital and strengthen negotiations with contractors and suppliers. Let's review our debt profile. Our net debt at the end of March stood at $270.7 billion, resulting in a net debt to EBITDA ratio of 2.48 times, slightly improved from 2.52 times at the end of 2024. Our debt maturity profile remains well balanced, with 52% of total debt maturing beyond 2030. The average debt maturity stands at 6.5 years. We maintain prudent risk management. Foreign currency exposure remains low, with just 5% of total debt unhinged. Importantly, PLDT retains investment-grade credit ratings of BBB from S&P Global and BAA2 from Moody's, underscoring investor confidence in our financial health. Looking forward, we remain committed to generating positive free cash flow by 2026 and continue working towards reducing our leverage, targeting around a 2.0 times net debt to EBITDA ratio over the medium term. Now, I'd like to shift gears and share some exciting developments from two of our key road drivers beyond traditional telco. One is Vitro, our state-of-the-art data center business. and Maya, our FinTech driver, both continue to demonstrate strong momentum and reinforcing PLDT's commitment to innovation and digital leadership. Our virtual data centers, particularly our newly energized hyperscale facility in Santa Rosa, represent a major strategic step, positioning PLDT at the forefront of Philippines' digital infralandscape.

Now let's watch this short video to give you a closer look at the intro of Santa Rosa and why we believe it will play a central role in supporting the... The world as we know it is changing, scaling, moving in hypergrowth, a robust restructuring of every aspect of our lives through artificial intelligence. keeping in step with the Philippines' move towards being the next digital destination of the region. This year, Vitro Incorporated unveils the Philippines' first AI-ready hyperscale data center, Vitro Santa Rosa. Designed to power tomorrow's digital demands, Vitro Santa Rosa delivers an impressive 50 megawatts of power capacity. This immense power ensures unparalleled performance for enterprises, hyperscalers, and AI workloads alike. With a Tier 3 certification, Vitro Santa Rosa guarantees 99.99% service level agreement. That's true reliability you can count on. Its resilient power, cooling, and connectivity ensure your mission-critical operations never miss a beat. At its core lies a diverse network infrastructure equipped with a triple-route domestic fiber network. Vitro Santa Rosa ensures continuous operations with the lowest latency and maximum resilience. Step into a thriving digital ecosystem where enterprise, cloud and AI data seamlessly connect and synergize. Where everything your business needs is within reach and where your data takes center stage. And with its AI-ready infrastructure, Vitro Santa Rosa is prepared to unlock the true potential of artificial intelligence. Hosted in Vitro Santa Rosa, EPLDT is the first to bring NVIDIA-powered GPU servers to the Philippines. EPLDT can now offer GPU as a service, boasting of enhanced security and reduced latency, ideal for critical AI tasks that require fast response times. With EPLDT's GPU as a service, enterprises and government agencies can access powerful computing on a pay-per-use basis, making AI adoption faster and cost efficient. From training complex models to powering real-time applications, Vitro Santa Rosa is where AI thrives and connects to the rest of the country. Connected to the country's widest domestic and international fiber network, Vitro Santa Rosa serves as a gateway to the rest of the Philippines and the world. Vitro Santa Rosa isn't just a data center. It's the home of AI and hyper-connectivity, powering the digital future today. True infrastructure reliability. True AI capabilities. A first for the Philippines. This is Vitro Santa Rosa.