Globe profit falls 27 percent in 9 months

MANILA, Philippines — Mobile giant Globe Telecom Inc. earned 27 percent less in the nine months to September, mainly due to a continuous rise in expenses, particularly on general and depreciation costs.

Based on its financial report, Globe said its profit dropped to P19.29 billion from P26.46 billion during the same period last year.

Globe recorded a three percent growth in revenue to P133.79 billion, but this gain was offset by a four percent jump in expenses to P116.86 billion.

Globe has raked in a record P121.06 billion worth of service revenues as of September, attributed to the expansion of its mobile, corporate, and non-telco segments. Its non-telco ventures also widened their contribution to total earnings to 3.4 percent from just 2.4 percent a year ago.

However, the telco incurred another quarter of increased expenses, with general costs up by three percent to P55.47 billion from P53.64 billion. Likewise, Globe grew its depreciation expenses to P34.49 billion, another factor that the company blamed for the decline in its profit.

In total, Globe spent P54 billion on capital expenditures at the end of the third quarter, leaving it with around P18 billion more to invest in the fourth quarter to achieve its capex guidance.

Globe said the bulk of the capex was used to meet the data requirements of subscribers given that connectivity demand keeps on going up with transactions going digital nowadays.

As of September, Globe has built 833 new cellular towers and upgraded 5,395 sites to LTE, as it has also deployed about 175,000 fiber lines across the archipelago.

It can be recalled that Globe is bringing down its capex spending to $1.3 billion or roughly P72 billion in 2023 from an all-time high of $1.9 billion in 2022. The telco is slashing its spending framework to maximize its existing network of assets and keep the balance sheet healthy.

Globe president and CEO Ernest Cu said the company could withstand economic headwinds and would push on with its strategy to go beyond telco to prepare the business for future challenges.

“We are happy that more of the non-telco businesses are contributing to Globe’s overall business growth and resilience,” Cu said.

“We will also continue to look for opportunities to thrive amid the macroeconomic challenges and competition,” he added.