TIGO Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Service Revenue: Reached $2 billion, a 5% organic growth year-over-year, marking the strongest growth since 2021.

Adjusted EBITDA: Achieved a record $1 billion, with a margin of 46.3%, slightly below last year's level due to restructuring costs.

Equity Free Cash Flow (eFCF): Recorded at $327 million, a 50% increase year-over-year, driven by strong operational performance and effective integration of acquisitions.

Net Debt: Increased to $8.1 billion, with leverage slightly declining to 2.73x, better than expectations.

Dividends: An interim dividend of $1.50 per share was approved, to be paid in two installments in January and April 2027.

2Strategic Updates and Business Highlights

Subscriber Performance: Postpaid net adds increased by 167,000 sequentially, while home service revenue grew due to better pricing execution and FIFA World Cup broadcasting rights.

Colombia Integration: The integration of Coltel is progressing well, with subscriber reporting harmonization completed, and underlying commercial performance remains strong.

Mobile Strategy: Focused on a "more-for-more" strategy to enhance ARPU through better data bundles, with a successful migration of prepaid customers to postpaid plans.

B2B Growth: Digital services revenue grew 14% year-over-year, reflecting strong demand for cloud and cybersecurity solutions.

3Forward Guidance and Outlook

2026 eFCF Guidance: Raised from at least $900 million to around $1.1 billion, reflecting confidence in cash-generating capacity.

Leverage Target: Improved target to below 2.5x by year-end, indicating strong operational execution and integration progress.

Market Expectations: Subscriber growth is expected to normalize following the integration efforts, with a focus on maintaining operational efficiencies.

4Bad News, Challenges, or Points of Concern

Integration Costs: Ongoing restructuring costs are expected to continue, with estimated charges for the full year between $160 million and $170 million.

Competitive Pressures: Chile remains a highly competitive market with aggressive pricing and elevated churn rates, posing a risk to profitability.

Currency Risks: Currency fluctuations, particularly in Paraguay and Colombia, could impact future margins and cash flow generation.

5Notable Q&A Insights

Cash Flow Phasing: Q2's strong cash flow may not be indicative of the same performance in Q3, with expectations for a lower Q3 followed by a stronger Q4.

ARPU Trends: ARPU increases are seen as a leading indicator for future service revenue growth, although some growth in Home was attributed to one-off World Cup revenues.

Integration Outlook: Management remains optimistic about Colombia's EBITDA margins aligning with 2025 levels, despite some expected contraction due to rebranding costs.

Competition from Satellite Players: SpaceX's Starlink is viewed as a complementary service for remote areas rather than a direct threat to TIGO's established mobile and broadband services. This summary encapsulates TIGO's Q2 2026 performance, highlighting both achievements and challenges while providing a clear outlook for the future.