LILAK — Liberty Latin America Ltd.

Liberty Latin America (LILAK) Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics

• Q4 Revenue: $1.2 billion, reflecting 1% year-over-year rebased growth.
• Full Year Revenue: $4.4 billion, slightly down on a rebased basis.
• Adjusted OIBDA: $451 million for Q4; $1.7 billion for the full year, representing 9% growth on a rebased basis.
• Adjusted OIBDA Margin: Improved by approximately 300 basis points in 2025.
• Adjusted Free Cash Flow (FCF): $278 million for Q4, with a full-year total of $150 million, a 29% year-over-year increase.
• P&E Additions: $640 million for 2025, down from $725 million in 2024, with P&E as a percentage of revenue at 14%.

2. Strategic Updates and Business Highlights

• Subscriber Growth: Added over 225,000 mobile postpaid subscribers in 2025, with notable contributions from Costa Rica and Puerto Rico.
• Hurricane Recovery: Despite challenges from Hurricane Melissa, the mobile network in Jamaica recovered quickly, with over 75% of fixed broadband customers back online.
• Fixed Mobile Convergence (FMC): Continued focus on FMC, with 40% penetration, aiming to enhance customer ARPU and reduce churn.
• B2B Growth: Strong performance in B2B, particularly in C&W Panama, with new contracts boosting revenue.
• Infrastructure Projects: Progress on MANTA and El Salvador submarine cable projects, expected to enhance long-term profitability.

3. Forward Guidance and Outlook

• 2026 Focus: Emphasis on rebuilding in Jamaica and expanding FMC. Anticipated return to near pre-hurricane profitability levels by the end of 2026.
• Revenue Growth Expectations: Mobile revenue expected to grow modestly, while fixed broadband may remain flat due to legacy product challenges.
• Cash Flow Improvement: Management aims to continue improving free cash flow, particularly in the second half of 2026.

4. Bad News, Challenges, or Points of Concern

• Impact of Hurricane Melissa: Adverse effects on revenue and OIBDA, particularly in Jamaica, with expected financial challenges in the upcoming quarters.
• Puerto Rico Performance: Decline in B2B revenue and overall revenue down 4% year-over-year, primarily due to customer migration issues and competitive pressures.
• Fixed Revenue Declines: Fixed revenue in Costa Rica decreased by 4% due to price competition, impacting overall performance.
• Leverage Concerns: Consolidated net leverage at 4.3x, with Liberty Puerto Rico facing high leverage challenges and potential liquidity needs.

5. Notable Q&A Insights

• AI and Cost Improvements: Management is optimistic about AI's potential to enhance operational efficiency and reduce costs, though tangible impacts are still being developed.
• FMC Opportunities: High potential for growth in FMC, particularly in Puerto Rico, where significant market share exists for fixed broadband.
• Shareholder Returns: Management indicated plans to reward shareholders, with potential announcements expected in 2026 as cash flow improves.
• B2B Strategy: New leadership in the B2B segment is expected to drive growth, with a focus on cloud services and improved customer propositions.

Overall, Liberty Latin America demonstrated resilience in 2025, achieving growth in adjusted OIBDA and free cash flow despite facing significant challenges from natural disasters and competitive pressures. The company remains focused on strategic initiatives to enhance profitability and shareholder value moving forward.