América Móvil, S.A.B. de C.V. (AMX) Q2 2025 Earnings Call Transcript

América Móvil reported a robust Q2 2025, with revenues increasing 13.8% year-on-year to MXN 234 billion, or a strong 7.9% at constant exchange rates, marking its best performance in over a year. EBITDA rose 11.2% (5.1% constant currency) to MXN 92.4 billion, contributing to a net profit of MXN 22.3 billion, aided by significant foreign exchange gains. Operational growth was driven by 1.7 million net wireless subscriber additions, predominantly high-value postpaid clients (2.9 million, with Brazil adding 1.4 million), and 462,000 broadband accesses. The company's net debt decreased by MXN 7.3 billion in the first half, and full-year CapEx guidance was slightly reduced to MXN 6.7-6.8 billion. Management highlighted the implications of new Mexican telecom regulations, including potential spectrum changes and increased fines, while noting that ongoing market consolidation in regions like Argentina and Colombia is anticipated to lead to more rational competition.

Analysis

América Móvil reported a robust second quarter for 2025, driven by its strongest constant-currency revenue growth in over a year, which increased 7.9%. In reported Mexican peso terms, revenue grew 13.8% to MXN 234 billion, aided by favorable foreign exchange movements. The primary operational driver was the high-value postpaid segment, which added 2.9 million clients, a 6.8% year-over-year increase, with Brazil being the main contributor with 1.4 million new subscribers. This strong postpaid performance, along with a rebound in prepaid revenue growth to 3.1%, helped mobile service revenue expand by 9.5%. The fixed-line business also showed strength, adding 462,000 broadband accesses, a significant acceleration from the prior quarter. EBITDA rose 5.1% at constant exchange rates to MXN 92.4 billion, and the company posted a net profit of MXN 22.3 billion, supported by an MXN 11 billion foreign exchange gain. Management demonstrated capital discipline by lowering full-year CapEx guidance to between MXN 6.7 billion and MXN 6.8 billion and reducing net debt by MXN 7.3 billion in the first half of the year. Key external factors include new Mexican telecom regulations, which present both risks through higher potential fines and opportunities via spectrum cost discounts, and ongoing market consolidation in regions like Colombia and Argentina, which is expected to foster more rational competition.

Key Decisions for Investors

• Investors should consider the strong operational momentum, particularly the 6.8% YoY growth in the high-value postpaid base and accelerating broadband additions, as key indicators supporting future free cash flow generation.
• Closely monitor the implementation of the new Mexican telecommunications law, as changes regarding spectrum costs and potential fines represent both a key risk and a potential opportunity in a core market.
• Evaluate the company's disciplined capital allocation, noting the reduced full-year CapEx guidance and ongoing share buybacks of MXN 8.7 billion in the first half, which signal a strong commitment to shareholder returns.