Operator: SNB Capital, I would like to welcome you to an earnings call with Mobily's management regarding the financial results for Q3 2026. With us on call today, we have our CEO, Nezar Banabeela, CFO Ibrahim Altukhaifi, VP IR Mohammed Aljbali, and Director IR Razan Alfuhaid. We will first listen to the management's feedback. Following this, we will open the floor to the questions. Management, please begin with your feedback.
Razan Alfuhaid: Thanks, Jehanzeb. Good morning and afternoon, ladies and gentlemen. Thank you all for attending today's call for Mobily. My name is Razan Alfuhaid, and joining me are our CEO, Engineer Nezar Banabeela, our CFO, Mr. Ibrahim Altukhaifi, and our VP of Investor Relations, Mr. Mohammed Aljbali. In today's call, our management will walk you through our operational and financial performance, and after that, we will open the floor for your questions.
Razan Alfuhaid: Noting that as we are bound by CMA regulations, we may not be able to answer questions on future expectations, nor future information that are not already available in the public domain. The earnings call presentation is available on the investor relations section of Mobily's website and is also available on our investor relations app. You may also access it by scanning the QR code shown on the cover page of this presentation.
Razan Alfuhaid: Before we begin this call, I would like to remind you that today's discussion may contain forward-looking statements which relates to our future events. Therefore, I would like to kindly ask everyone to refer to the relevant disclaimer included in this presentation. I would like now to hand over the call to our CEO, Engineer Nezar. Thank you, everyone.
Nezar Banabeela: Thank you, Razan. Good morning and afternoon, everyone, and welcome to Mobily Q3 2026 Earnings Call. Beyond the key macro indicators on the screen, Alhamdulillah, Saudi Arabia made significant strides during the quarter in the digital transformation domain. Of course, within this dynamic environment, Alhamdulillah, again, Mobily continued to strengthen speed and positioning as a leader in digital connectivity.
Nezar Banabeela: We ranked first among operators in Saudi Arabia for game download speed, and as you know, this is one of the most important elements for the young generation that we have in Saudi Arabia. This wouldn't be possible without having, Alhamdulillah, our major gaming platforms, reflecting again our commitment to delivering a superior connectivity and network experience. Moving to what has been done during this period of time.
Nezar Banabeela: In this Q4 2026, we continued to advance our strategic priorities. As you see, we strengthened our local content and expanded our global participation and partnership. We obtained the local content certificate for the seventh consecutive year, reaffirming our commitment to supporting the national economy and also contributing to the Kingdom localization objectives.
Nezar Banabeela: Alhamdulillah, Mobily Pay also participated in Money20/20. That by itself is one of the strategic partnerships that we want to accelerate the growth in Saudi Arabia in the fintech ecosystem and, of course, advance the financial innovation, further reinforcing our role in supporting Saudi Arabia's digital transformation.
Nezar Banabeela: In parallel, we had a wonderful contribution and participation in LEAP. That by itself strengthened our strategic partnership at LEAP 2026 and collaboration with the leading industry players. If we look at it in LEAP, we had several major announcements.
Nezar Banabeela: We had more than 23 deals. That was across five major strategic focus areas covering cloud, AI infrastructure, and, of course, digital skills. One of the most important key highlights, as what you see, we signed a wonderful partnership with BytePlus. This is to establish its first public cloud in the region in MENA. Alhamdulillah, it will be located here in Riyadh.
Nezar Banabeela: This partnership marks a very important step to advance our digital capabilities and, of course, support the technology ambition of Saudi Arabia. You are becoming much more familiar with our SHINE strategy that we announced earlier in 2026. Of course, we are sharpening our priorities, and we want to guide our execution to be tailor-made towards this strategy.
Nezar Banabeela: We remain focused on accelerating the digital infrastructure and delivering long-term value for our stakeholders and, of course, elevating the customer experience digital across all of our business and also individuals. This is where we want to expand our enterprise solution and digital infrastructure and, of course, enhance the operational efficiency and excellence within Mobily itself.
Nezar Banabeela: Looking at the three main units, Consumer, Business, and Wholesale. Turning to our segment performance in the Q3, Alhamdulillah, the Consumer segment continued to enhance the customer experience. That wouldn't be possible without simplifying the digital journey and addressing also the key customer pain points. We also revamped our postpaid offering through the launch of our new Shamel packages. This is where we want to strengthen our high-value postpaid base and market competitiveness.
Nezar Banabeela: Secondly, in our Business segment, we continued to reinforce the position on the strategic digital and core services. This is where we are partnering with all of our customers, being in the key segment and the industrial verticals. That mandates on us that we need to strengthen our product portfolio. Also, we want to enhance our operational efficiency to have a very sustainable growth, Inshallah, and ensure that the continuation of the involvement of the business will be always the case and at the level of the satisfaction of our customer.
Nezar Banabeela: The third one, which is our Wholesale segment. This is where we expanded our services capabilities, our market reach. We are leading regionally and globally with great players, and we are showcasing a very advanced solution that comes through the global connectivity and infrastructure, especially for digital requirements.
Nezar Banabeela: Now, that come with this great result that, Alhamdulillah, we are moving to our Q3 financial results, that we continue our growth in the revenue and the net income. Of course, we are maintaining our robust EBITDA margin. Taking you through the numbers, I leave it with our colleague, Ibrahim Altukhaifi, our CFO, who will take you through the details for the financial of this quarter. Thank you.
Ibrahim Altukhaifi: Thank you, Engineer Nezar. Good morning, afternoon, ladies and gentlemen. It is a pleasure to have you joining us today. As Engineer Nezar highlighted, we continue to make good progress during the quarter. Let me now talk you through the financial performance for Q3, starting with revenue. Q3 revenue stood at SAR 5.1 billion, increasing by 4.5% year over year, primarily driven by growth in the consumer and wholesale segments.
Ibrahim Altukhaifi: Our consumer segment continued to be the largest contributor to our growth, supported by continued momentum in our customer base across mobile and FTTH. With the launch of Shamel packages this quarter being an important step in our value management strategy, which was designed to deepen customer engagement and support ARPU uplift over time, and enhance customer lifetime value and the overall quality of our customer relationship.
Ibrahim Altukhaifi: Our wholesale segment also maintained positive momentum, reflecting our continued efforts to expand service capability, broaden customer reach, and capture growing demand for connectivity. Revenue quarter over quarter remained broadly stable, inching down by 0.2%, primarily reflecting lower business revenue.
Ibrahim Altukhaifi: As we have highlighted previously, we expect B2B growth to normalize in H2, reflecting the higher base we reach, as well as softer government project activity this year, while remaining focused on selective high-margin opportunities. Looking at the nine-month period, we achieved a growth of 5.1%, reaching SAR 15.2 billion, reflecting broad-based growth across all revenue stream and reinforcing the resilience of diversification of Mobily's top line.
Ibrahim Altukhaifi: Overall, our focus remain on maintaining healthy revenue growth while improving its quality, strengthening monetization, and maximizing sustainable shareholder value creation. Our customer base continued to expand, with mobile subscribers growing by 12% year over year and 1.2% quarter over quarter to reach 15.1 million subscribers, driven by our ongoing focus in delivering superior customer experience that supported continued momentum, not only the prepaid segment, but also in the postpaid, which had over 6% growth year over year.
Ibrahim Altukhaifi: Additionally, our FTTH subscriber base grew by 6.4% year over year and 0.5% quarter over quarter, reaching 360,000 subscribers, reflecting our ongoing effort to deepen households penetration and strengthening our position in the fixed connectivity.
Ibrahim Altukhaifi: Importantly, we continue to focus on the quality and the value of these relationships through stronger engagement, higher value proposition, and improved monetization over time. Turning to our profitability, EBITDA reached SAR 2 billion in Q3, making nearly 2% increase year over year, driven by the growth in revenue.
Ibrahim Altukhaifi: Despite broadly stable revenue growth quarter-over-quarter, EBITDA increased by almost 2%, reflecting continued cost discipline and operational efficiency. As a result, EBITDA margin reached 39.5%, maintaining our position as the highest in the market and highlighting our strong profitability and operational performance. For the nine-month period, EBITDA recorded a robust growth of 6.6%, demonstrating the underlying scalability of the business and operational excellence.
Ibrahim Altukhaifi: We aim to maintain a healthy balance between commercial investment, capability development, and sustainable profitability. As our revenue mix evolves, margin may vary between periods. We will continue to focus on the growth in EBITDA, the quality of that growth, and the return generated in our investments. CAPEX for the nine months stood at SAR 2 billion, aligned with the investment in expanding our 5G network and deploying our fiber and data center infrastructure.
Ibrahim Altukhaifi: The year-over-year decline reflects the higher comparison base in 2025, which includes spectrum-related investment. Excluding this effect, the normalized CAPEX would have grown by 7.3% year-over-year. Our quarterly investment is progressing in line with our network expansion and growth priority, and we remain focused on disciplined capital allocation, prioritizing investment that strengthens our core business, supports future growth, and generates attractive return to shareholders.
Ibrahim Altukhaifi: Our balance sheet remains strong with gross debt declining by nearly 4% year-over-year and almost flat quarter-over-quarter, reflecting a reduction in our overall debt level. Net debt also declined by almost 6% year-over-year to reach SAR 7.2 billion, with net debt to EBITDA ratio improving to 0.9 times, down from one time last year. This healthy leverage position preserves our financial flexibility to continue investing in the strategic growth opportunity while supporting sustainable shareholder return.
Ibrahim Altukhaifi: Finally, we sustained our solid bottom line performance with net income reaching SAR 925 million in Q3, increasing by almost 1% year-over-year and 2.7% quarter-over-quarter. For the nine-month period, net income increased by 7.7% to reach SAR 2.7 billion. This performance was supported by continued revenue growth and solid EBITDA, demonstrating continued conversion of operating growth and our focus on driving sustainable value creation for our shareholders.
Ibrahim Altukhaifi: As we approach year-end, we remain on track to deliver on our given guidance for the full year. Our nine-month performance gives us confidence in the trajectory of the business, supported by healthy revenue growth, resilient profitability, and disciplined capital structure to continue our growth momentum. With that, we conclude our prepared remarks, and we'd be happy to open the floor for the Q&A session. Thank you Mobily's management.
Razan Alfuhaid: Jones here, we can start the Q&A sessions, and please limit the questions to two per individual to allow more questions to be asked.
Operator: Thank you, management. Ladies and gentlemen, we will now start the Q&A session. If you wish to ask a question, please raise your hand or you can conversely type in the Q&A box. Kindly introduce yourself before you ask your question, and kindly limit your questions to two at a time so that everyone can have their chance. We will wait until we have our first question. Looks like we have our first question from the line of Cesar Tiron. Cesar, please go ahead. You are unmuted.
Cesar Tiron: Good afternoon, everyone. It is Cesar from Bank of America in Dubai. I have two questions. The first one relates to the B2B revenue in Q3. It was slightly declining. Could you please help us talk about it? What really happened? I think it is the first time I see this revenue stream being so soft.
Cesar Tiron: Is it really revenue probably delayed into Q4, into next year, or are things really slowing down and this maybe is a new trend? It would be great if you could give us as much information as possible on this point because I think it is really important. Then I think the second one would be on the CAPEX. CAPEX to sales, I think for the 9 months, you disclosed that at 13%, but I think the guidance for the full year is way higher than that. I think it is 18% to 20%.
Cesar Tiron: Do you really expect a substantial, I know there is always a bit of seasonality, but do you really expect such a significant boost in CAPEX in Q4, especially given the current circumstances, so that CAPEX is going to be so high, 18% to 20% for the full year? I mean, what is going to drive that? Thank you so much.
Ibrahim Altukhaifi: Thank you, Cesar, for your question. As we have guided everyone earlier in our year-end 2025 call and also our last call in Q2, we actually expected the B2B growth to be normalized this year. That is mainly two major factors taking in consideration. First, a softer pace that we are seeing from the market, and part of it, of course, the government project activity that compared with the recent period
Nezar Banabeela: We have seen this already before, and we saw that the volume of the new project coming to the market with a decline in the number of the ICT projects, and also have been reflected officially in Etimad. As part of what we are seeing in the market, of course, we keep saying that Mobily always will be part of the market and always will have its own impact because of such changes. Saying that, we still remain disciplined in our approach.
Nezar Banabeela: Of course, we will always be selective in our projects and what we want to focus on that will bring a better margin. Of course, we will focus always on the digital and the connectivity opportunity.
Nezar Banabeela: The increase, of course, Inshallah, that we see also, we got it in some of the private sector and maintaining that kind of sustainable growth that we are hoping for in the B2B. That, of course, will be reflected in our profitable growth and the confidence on the footage that to achieve our guidance by the year-end.
Nezar Banabeela: The second, of course, we are as B2B for the last 5 years, we are growing double digits year-over-year. That by itself gave us a great market share and also a great base. Now, of course, to continue that double growth, it does require more and more effort from everyone, and we are committed to that, Inshallah. We should also look at the base of the B2B today in the company, where Alhamdulillah, it has become much more bigger than before.
Nezar Banabeela: What we want to assure everyone, Mobily management is still continuing its great effort to bring the biggest value to our shareholders and will always will be adhered to any kind of further questions or clarifications. I leave the second question for the CAPEX with our CFO, Ibrahim Altukhaifi, he will answer that question.
Nezar Banabeela: In the CAPEX side, actually, the CAPEX deployment is not necessarily linear throughout the year, as it is mainly driven by the project execution milestone and the timing of the investment. We therefore expect a higher level of CAPEX in Q4 as we progress with the planned investment while remaining guided by our full year CAPEX intensity target of 18% to 20%. In addition, we will continue to align CAPEX with demand, project readiness, and expected return, maintaining a disciplined approach to capital deployment. Thank you.
Operator: Thank you, management. The next question comes from the line of Madhvendra Singh. Madhvendra, please go ahead. Madhvendra, please go ahead. You are unmuted. It looks like Madhvendra cannot unmute themselves. I would like to remind you guys again that if you want to ask your question. We are unable to hear then. Please go ahead.
Madhvendra Singh: I have a couple of questions. The first is on the consumer revenues. If you could talk about the drivers behind the strength during the quarter. Given that B2B has been soft, but at the same time, consumer is doing better. What went behind that? Was it driven by handset sales or is it more service revenue-driven? Some color around that.
Madhvendra Singh: Then, following up on the CapEx question, it is not really clear what you mean. Are you sticking to the guidance of 18% to 20% for the full year? Because then it will imply a significant increase in the quarter, CapEx in Q4.
Madhvendra Singh: Just saying that there is like a seasonality or some month quarter-on-quarter variance, that does not answer the question that whether we should do the simple math and reach 18% CapEx for the full year, all coming in Q4. That is what I think from a modeling perspective, it is important for us to understand that. Thank you.
Nezar Banabeela: It is always great to hear your voice, Madh.
Madhvendra Singh: Thanks.
Nezar Banabeela: I will try my best to be as smart as you and answer you on the consumer, where I am sure Ibrahim is smarter than me, and he will answer the second one. For the consumer, as what you said, we delivered a wonderful year-over-year growth, which is 5.3. That would not be possible without a supported, sustainable commercial momentum that we saw across mobile and home connectivity. That is where, if you remember, we continued our expansion for our 5G and all the backbone for Mobily.
Nezar Banabeela: Now we are seeing wonderfully, that is where we are getting that growth on the 5G FWA and also the FTTH network. That also we need to think of it with what have been done in Q3. Today, we look at how we can increase the adaptation for the postpaid and how can we support the subscriber growth and demand for high-speed connectivity.
Nezar Banabeela: That is why we revamped our postpaid portfolio, we launched our new Shamel packages. This is aimed mainly to drive a better ARPU and extend also the lifetime for our customer. That is where we strengthen our position in a high-value segment. Saying that, we will continue all the time enhance our customer experience. If you remember, always we keep saying our corporate strategy has these 5 pillars, and number 1 is the customer experience.
Nezar Banabeela: The second one, where we want to expand the digital offers that have been done in Shamel. Number 4, where we said we want to make sure that we have the digital infrastructure. Now, for the digital infrastructure, this is where we expanded our digital sales channel. We introduced the new look and feel for our app.
Nezar Banabeela: We introduced much more targeted propositions and loyalty initiatives to support the customer engagement and retention. This is where, Alhamdulillah, we maintain a better outcome for the B2C that is reflected for that growth. I hope I answered your first question, Madh.
Madhvendra Singh: Yes.
Nezar Banabeela: Yes?
Madhvendra Singh: Yes. Thank you. That is helpful. Thanks.
Nezar Banabeela: Okay. For the CAPEX, I will leave it to Ibrahim.
Ibrahim Altukhaifi: Thank you, Madh. I think, as I mentioned, the CAPEX deployment is not necessarily linear throughout the year, and it depends on the project execution milestone. If you simulate 2025, where usually Q4 is the most CAPEX intensity and Q4, which will be similar in 2026.
Madhvendra Singh: Okay. Thank you.
Operator: Thank you, management. I will take a question from the Q&A box. There is a question in the Q&A box regarding the data centers plan expansion, and the cost related to the expansions of data centers, and also if there is a need to fortify a critical network infrastructure given the current geopolitical situation.
Nezar Banabeela: Of course, the data center, as what we earlier said, is one of our major infrastructure, and definitely we will continue our plan for data center. Whatever there in the market that came out because of the situation from the geopolitical side or any other condition, that will be applied to anyone. Not only that, actually, this one will differentiate the players in the market.
Nezar Banabeela: Data center is always one of the major capabilities and infrastructure capabilities that needed to be in place to serve, first, the customer itself that we have in the B2C under our technology team for our own requirement. Second, the enterprise segment, which is the biggest segment that we are serving in our data center, being for government or large enterprise or SME with a very tailor-made solution.
Nezar Banabeela: Third, for the wholesale customers. With what is happening on the other side from an AI perspective, that is actually reinforcing the need for the data center. From our side, yes, we will continue our expansion for the data center, knowing that this is a very mandatory capability should be in Mobily and continue in Mobily.
Operator: Thank you, management. The next question comes from the line of Jonathan Milan. Jonathan, please go ahead. You are unmuted.
[Analyst 1]: Good afternoon. Thank you very much, everyone, for taking the time for the call. Just three questions from my end. Can you please reiterate what you mean on the B2B business? I mean, we are hearing that there could be a slowdown of new tenders on the government portals. You are saying last year it was a higher base. What are your expectations for the next, not just 3 months, but maybe even 6 months and 12 months, given what you are seeing in terms of activity on the tender business? That is the first question. If you can please answer it.
Ibrahim Altukhaifi: Thank you, Jonathan, for the questions. In terms of guidance, as we have mentioned previously, we only give the full year guidance, and 2027 guidance will be, Inshallah, communicated by the full year of 2026 disclosure that is expected next year, Inshallah. You can ask all of the questions at once, so we can answer
[Analyst 1]: Understood. Just as a follow-up, are you seeing less tender activity in B2B and B2G today than you were seeing during the same time period last year?
Nezar Banabeela: Yes. If this is the question, Jonathan, yes.
[Analyst 1]: Okay. Thank you very much. On the CAPEX, again, just to go back to the CAPEX question, it feels like the CAPEX will probably not be 18% to sales, although I am not sure because I did not fully understand your answer. If that is the case, then would there be more upside to the dividends as well? Do you expect the dividend to continue to increase incrementally even if EPS growth drops to low single digit, given that your cash flow generation is very strong, net debt EBITDA is very low? Thank you.
Ibrahim Altukhaifi: Actually, we are disciplined to our capital allocation, and we are trying to strike a balance between our investment and our shareholder return as well. Over the past years, we yearly increasing our dividends and in each one we increase by almost 27%, and we will continue on our discipline to our shareholder, and we are trying our best to invest on the high priority investment that has a demand and future growth for the company.
[Analyst 1]: Okay. Thank you very much. Sorry, one last thing. Any progress on the tower sales? Any idea and any thoughts on what you would do with the proceeds?
Ibrahim Altukhaifi: That is question number three, Jonathan.
[Analyst 1]: Perfect.
Ibrahim Altukhaifi: It is fine.
[Analyst 1]: Thank you.
Ibrahim Altukhaifi: Yeah, no worries. We will definitely give a clarity on the discussion. As you know, preliminary discussions with Tawal have been disclosed earlier. We already said there is no any kind of binding transaction or agreement have been announced. Any potential transaction would be evaluated, of course, against the evaluation.
Ibrahim Altukhaifi: Of course, we need to look at the long-term economics, also the operational flexibility, and also the shareholder value. If we are coming out with any kind of a decision, we will announce it to the market at that point of time.
[Analyst 1]: All right. Thank you very much. Thank you, gentlemen.
Ibrahim Altukhaifi: Thank you, Jonathan.
Operator: Thank you, management. I will take another question from the Q&A box. There is a question related to the energy tariff increasing news that broke out yesterday. Again, management shed some light on it. What impact would it have, especially in the context of data center and data center investment?
Ibrahim Altukhaifi: We are currently assessing the implication across our operation, as the overall financial implication will depend on several factors, including our consumption profile, applicable tariff categories, and existing commercial arrangements when we talk about data center. It would be premature to quantify the financial impact at this stage. We are assessing, and we will disclose whenever it is material to our financial.
Operator: That is clear. I will take the next question from the line of Rohit Modi. Rohit, please go ahead. I am going to unmute you, but kindly limit yourself to just two questions at a time. Thank you. You are unmuted.
[Analyst 2]: Thank you. Hope I am audible, and thank you for taking my questions. So, two questions. Firstly, both follow-ups. Firstly, on the B2B side, and I understand you mentioned the tendering process has slowed down or very low tenders are coming in on the Etimad. But directionally, do you see that because of the current geopolitical situation and budget constraint, and then eventually you see that is come out, that is a phasing effect, and you might see more projects going forward in the midterm, or that kind of a structural slowdown that you are seeing from the government side in terms of ICT projects?
[Analyst 2]: Second question is basically on the consumer environment. Given the performance on the B2C side, are you actually seeing any kind of change in terms of consumer behavior and competitive behavior or taking more share in market? Any color around that would be grateful. Thank you.
Nezar Banabeela: Okay, for the first one, for the B2B, I think we clarified our answer for the B2B. We are continuing our great effort for the B2B side. Of course, as I said earlier, Mobily is part of the market, if there are any changes in the market, definitely we will be part of these changes. Now, for the B2C side, Alhamdulillah, we continued our great growth that you saw in the B2C side.
Nezar Banabeela: Of course, if there are changes due to any kind of constraints in the market or slowness or GDP impact, that of course will have its own impact on the individuals and on the purchasing power, and it could have its own impact on Mobily or any other company. We are still focusing on our growth, where we want to gain more in the market share side.
Nezar Banabeela: We are still focusing as what we saw in the postpaid, prepaid, 5G, FWA, and FTTH. That is where we are differentiating ourselves through the new packages, as what we highlighted of Shamel, and also the superior positioning that you saw, for example, in gaming and other elements where we are creating a full ecosystem around every single customer that we have in the B2C. Thank you.
Operator: Thank you, management. The next question comes from the line of Omar Mahad. Omar, please go ahead. You are unmuted.
[Analyst 3]: Hello? Can you hear me?
Operator: Yes, Omar, you are audible. Please go ahead.
[Analyst 3]: Thank you. Thank you, gentlemen. My question is on the B2B segment again. I am not asking for KPIs that are not part of your disclosure today. But if you could look at the current backlog in the B2B segment, and if you look at the weighted average contract duration of that backlog.
[Analyst 3]: Is it reasonable to assume that the slowdown that we are seeing in revenue execution or revenue growth in the B2B segment today is a result of the backlog evolution that happened perhaps a year ago when you started signaling that there is a slowdown in the number of projects on Etimad? If we could use that as a forward indicator, how does the execution or how does the current backlog look for the coming 12 months?
Nezar Banabeela: Omar. For the first part, yes. As what you rightly mentioned, and we highlighted this way earlier, as what you said, Omar, that we are seeing certain changes in the market, that it could have its own impact on the B2B. This is where we understood this kind of impact, and we signaled it to the market.
Nezar Banabeela: Even though, despite all of these challenges, again, we are performing well in the B2B side. Now, coming to the other side of your question, which is the forward-looking on that. This is more of a guidance, but let me help you from the other side. For example, as I said, we signed more than 23 agreements with more than 16 partners. 7Also we focus on what does matter to the end user in the B2B domain, which means mainly in core network, building cloud services, AI capability, and making sure that we diversify our B2B offering with the right verticals that we want to focus on.
Nezar Banabeela: This by itself, which has its own large focus in the network AI and automation, and that is where we want to make sure that we have a wonderful relationship with our partners, and that is where we want to give this kind of capabilities to the end user so they can have the reliable and operational efficiency, especially in such time where there are certain constraints in the market.
Nezar Banabeela: The second one, of course, what we built as cloud and digital infrastructure. That is why I highlighted the point of BytePlus. As you know, BytePlus is one of the leading companies worldwide, and they are the one who is actually supporting ByteDance, who is owning TikTok. That by itself, it is a huge capability that we are bringing now to the market and want to offer it to the end user.
Nezar Banabeela: On top of this, as you know, from smart solution perspective, we have a wonderful agreement that have been signed, and we announced it officially, being with Ministry of Media or even the Saudi Irrigation Organization to showcase our capabilities from digital perspective on top of the cybersecurity capabilities that took place and what we announced.
Nezar Banabeela: So we are hoping all of these kind of capabilities will help us to perform better, inshallah, in the future and better than the market. Better than, again, Mobily is part of the market, Omar Mahad, and any kind of constraints in the market could have its own correlation to Mobily and impact Mobily. Thank you.
[Analyst 3]: Much appreciated.
Nezar Banabeela: Okay.
Operator: Thank you, management. I will take another question from the Q&A box. There is a question in the Q&A box that is regarding the growth that management expects in the top line and bottom line coming from the data centers by 2028. Can management shed some light on this?
Nezar Banabeela: Thank you, Gianzi. I think this question is focused on future guidance, and as you may be aware, we are limited by CMA restrictions, and we will give the guidance for 2027 in the full year, inshallah, performance. As for 2028, it will come at that time. Especially, we do not give guidance for data centers specifically. We give guidance for the overall performance of the company. Thank you, Gianzi.
Operator: Thank you, management. Next question comes from the line of Evgeny Anenko. Evgeny, please go ahead. You are unmuted.
[Analyst] (Jefferies): Evgeny Anenko from Jefferies. Thank you for taking my questions. I have two, please. First, I just wanted to clarify your data center capacity. I think on Q2 call in July, you mentioned it is 39 megawatts. At the same time, I see that in some of your materials you are saying that combined technical and commercial DC capacity is around 122 megawatts. I just want to reconcile these two numbers and also reconfirm your expansion plans.
[Analyst] (Jefferies): I think you mentioned one that you actually wanted to add 39 megawatts, out of which 13 was delivered, so it is 26 pending. So overall, if you can kindly please reconfirm your existing capacity and the pipeline. My second question would be please on your government business again. On top of lower tender volumes, do you also see any deterioration of collection of receivables from the government? Thank you.
Nezar Banabeela: Now for the first question, which is related to the data center, what we should focus on more on the commercial side, and this is where we announced officially the 40 megawatt that is available for our customer and the commercial activities. This is where we announce also that we will have another 26 megawatts that is coming inshallah, during the next 18 to 24 months, focusing more and more on the commercial side.
Nezar Banabeela: Of collection of on the cash flow, you can see that Mobily has improved the growth in operational cash flow by almost 11%, which give you indication of the healthy collection on the nine months, alhamdulillah. We maintain, alhamdulillah, healthy cash flow, allow us even to invest and paying dividends over the years, and we will continue our performance on the collection as well.
[Analyst] (Jefferies): Thank you so much. Lastly, not a question, just small comment from my side. It would be really appreciated if you consider enhancing your disclosure on B2B business, in particular, maybe splitting it into B2B and B2G or connectivity and IT services. I think that would be really appreciated. Thank you.
Nezar Banabeela: Thank you, Evgeny. We will consider that in the future disclosure, and we will get back to you on it. Thank you.
Operator: Thank you, management. The next question comes from the line of Abdulaziz Alghadi. Abdulaziz, please go ahead.
[Analyst 4]: Yes. Am I audible?
Operator: Yes, you are. Please go ahead.
[Analyst 4]: Yes. Thank you, management, and congratulations for the results. I just want to understand from your side, so now with the government expanding its PPP programs, I just want to understand where do you see Mobily fitting in? On the digital government services side or in the infrastructure side? We know that Mobily been always in the infrastructure side, but, do you see Mobily expanding to other areas? And if so, do you need any certain licenses that you already don't have or not? Thank you.
Nezar Banabeela: Thank you so much for your question. First, we don't need to get any further license. Mobily is a full-fledged company that alhamdulillah, we have all kind of licenses to provide all the kind of the sophisticated solutions, which actually part of it already part of our offers and what we are providing in the market. The PPP is not a new service, already provided in Mobily, already part of our portfolio.
Nezar Banabeela: We demonstrated the highest level of commitment and sophisticated solution provided to the end user, being to the government or even some of the large enterprise, in a great collaboration and partnership spirit. Now you are absolutely right. Yes, of course, we'll continue our focus to expand these capabilities to serve the country better on that side. This is just only continue building on what we have and take it to a much more larger share from the market with these kind of services.
[Analyst 4]: Thank you.
Operator: Thank you, management. The next question comes from the line of Thando Skosana. Thando, please go ahead. You are unmuted.
Thando Skosana: Great. Thank you for taking my questions. I will just keep it to two, please. I just wanted to follow up on the B2B segment again. I know there have been a lot of questions around it, and you have spoken about the market and how that is been slowing down. I mean, I have been hearing some of your peers talk.
Thando Skosana: I just wanted to get a sense, are you seeing any increase in competition and/or pricing pressure within your B2G or your private sector? So between private and public sector, please, if you could answer that.
Thando Skosana: The second question is just on EBITDA margin guidance. I appreciate this guidance hardly changes, but you have done 39% year to date. I would have expected you to maybe increase the top end of that guidance. Is there a reason why you would land up at around 38% margin for the full year? I just want to understand what you guys are baking in for 2026. Thank you.
Nezar Banabeela: Okay. We will try to answer the question again in the B2B side. As you know, the B2B landscape in Saudi Arabia is evolving rapidly and largely, of course, driven by the Saudi Vision 2030 initiatives. Digital transformation is a kind of mandate across all of the sectors, and of course, the increasing demand for advanced ICT solution will always be the case.
Nezar Banabeela: On our side, as Mobily, alhamdulillah, we are absorbing a very strong demand in key areas, being in the connectivity or data center or cloud or ICT, and even including the cybersecurity and data. Now, you are talking about a market which is a very developed market and has also a great amount of different companies that they can provide the services. That, of course, will have its own pressure.
Nezar Banabeela: What we differentiate ourselves compared to the others, which is how can we understand our customer in a better way? How can we provide a comprehensive solution that help them, that they can grow their own business and behaving as a real partner to them?
Nezar Banabeela: These are the real values that you want to give to any kind of customer to give us a differentiated price and margin compared to the competition, and help us to maintain, alhamdulillah, our EBITDA margin and our profit margin. I hope I could answer you for the B2B.
Thando Skosana: Thank you.
Ibrahim Altukhaifi: On the EBITDA margin, alhamdulillah, our margin performance continue to reflect our combination of revenue growth, revenue mix, and disciplined cost management. These remain important structural drivers for our profitability, and we will continue to build on them. That said, margin will naturally fluctuate depends on revenue mix, including handset sale and timing of B2B project, and as will the operating costs associated with the new business.
Ibrahim Altukhaifi: We expect some normalization as the business evolve, particularly given the competitive environment and the changing on the revenue mix. Our priority remain sustainable EBITDA growth and protecting profitability rather than maximizing margin percent in any individual quarter. We continue to focus on our operational efficiency, high-value services, and disciplined commercial execution.
Thando Skosana: Thank you.
Operator: Thank you, management. As we approach the end of the designated time, I will take one more question before I will hand over the mic to the management for the concluding remarks. The last question I will take will be from the line of Abdulaziz Al Habashi. Abdulaziz, please go ahead. You are unmuted.
[Analyst 5]: Thank you for taking my question. I have a question for Ibrahim. Ibrahim, you have seen the rise of Mobily's B2B segment over the past few years, and I wonder how different is this time for Mobily. Is it a tougher competition out there, or is it growing from these levels would require some sacrifices to be done by Mobily in terms of margins and taking on some balance sheet risks?
Operator: Management, would you want to take this question, please?
Nezar Banabeela: Can you repeat the question?
[Analyst 5]: The question is to Ibrahim, the CFO. You have seen the rise of Mobily's B2B segment over the past few years, and how different is this time for Mobily compared to the prior few years? Are we seeing tougher competition and priorities of award from various government entities, or is it for Mobily that to grow from these levels you need to do some sacrifices on your end in terms of taking on lower margin projects or taking on some balance sheet risk when taking on these projects?
Nezar Banabeela: I believe, Abdulaziz, I answered that question earlier, despite that you did put it in different format, where I said earlier that we give a guidance to the market in the year-end 2025 and also in Q2 calls where we are expecting a certain normalization for the B2B this year. Even I highlighted two different reasons. One, I said the soft base that we are seeing generally in the market, and this is where compared to the previous period of time, and that's where also an estimate.
Nezar Banabeela: The second one, where we are having a higher base compared to the previous, and to grow that base, of course, we are doing all of our best to continue with the great momentum that we had before in the B2B, but that should not take us away, that today, mashallah, the B2B in Mobily as a base is way bigger than before. Thank you, Abdulaziz.
[Analyst 5]: This is very clear. In terms of the base, this is very clear and well-articulated. But in terms of how different this time from at least 2022, 2023, 2024, the type of projects, can you please elaborate on that? How different is this time from those years when Mobily were able to grow at double digits continuously?
Nezar Banabeela: It is because of the two factors that I highlighted, Abdulaziz. If we have a softer base that we see in the market, this is because of the market conditions, of course, it is different than 2022. If you compare the base that we have in the B2B, even from revenue perspective, for Mobily 2022 compared to 2026, of course, today, the B2B segment, even as revenue in Mobily, way bigger than 2022.
[Analyst 5]: Okay.
Nezar Banabeela: Thank you, Abdulaziz.
Operator: Thank you, management. As we are nearing the end of our call, I would like to give the mic back to the Mobily's management to give their concluding remarks. Management, please go ahead.
Razan Alfuhaid: Thank you, Jehanzeb, for hosting the call on the SNB Capital, and thank you everyone for joining us today and participating in Mobily's Q3 2026 earnings call. As always, we are available for any questions through the Investor Relations contacts details shown on the screen. Thank you again, and we look forward to staying in touch. Appreciate it.
Operator: SNB Capital would like to thank Mobily's management for taking the time out to conduct this call. We would also like to thank all the participants for attending. You may now disconnect.
