Chunghwa Telecom Co Ltd (CHT) 2025 Q1 法說會逐字稿

Good afternoon, ladies and gentlemen. Welcome to Chunghwa Telecom conference call for the company's first quarter 2025 operating results.

女士們、先生們，午安。歡迎出席中華電信2025年第一季營運績效電話會議。

(Operator Instructions)

（操作員指示）

For your information, this conference call is now being broadcasted live over the Internet. Webcast replay will be available within an hour after the conference is finished. Please visit CHT IR website, www.cht.com.tw/ir under the IR Calendar section.

供您參考，本次電話會議目前正在網路上現場直播。會議結束後一小時內將提供網路直播重播。請造訪 CHT IR 網站 www.cht.com.tw/ir 下的 IR 日曆部分。

And now I would like to turn it over to Ms. Angela Tsai, Assistant Vice President of Investor Relations. Thank you. Ms. Tsai, please go ahead.

現在我想把時間交給投資人關係助理副總裁 Angela Tsai 女士。謝謝。蔡小姐，請講。

Thank you. I am Angela Tsai. Welcome to our first quarter 2025 results conference call. Joining me on the call today are our President, Rong-Shy Lin, and our Chief Financial Officer, Audrey Hsu.

謝謝。我是 Angela Tsai。歡迎參加我們的 2025 年第一季業績電話會議。今天與我一起參加電話會議的還有我們的總裁 Rong-Shy Lin 和財務長 Audrey Hsu。

During today's call, management will begin with the rest and strategic achievements and provide our business overview of the first quarter, followed by a discussion of our segment performance and the financial results. After, we will move on to the question-and-answer portion of the call. On slide 2, please read our disclaimers in note concerning forward-looking statements.

在今天的電話會議上，管理層將首先介紹其餘部分和策略成就，並提供第一季的業務概況，然後討論我們各部門的業績和財務結果。之後，我們將進入通話的問答部分。在第 2 張投影片上，請閱讀有關前瞻性陳述的免責聲明。

Now, without further delay, I will turn the call over to our President Lin, please go ahead.

現在，不再拖延，我將把電話轉給我們的林總裁，請繼續。

Thank you, Angela, and hello, everyone. Welcome to our first quarter 2025 results conference call. We are excited to report net income and EPS delivered 4.3% year-over-year increase in the first quarter, driven by our solid operation and a leading position in mobile, fixed line and ICT business. Despite the first quarter's rapid change in the macroeconomic climate due to the global tariff issue from which we believe there is no material impact. We believe that this may even present new opportunities for our international business.

謝謝你，安吉拉，大家好。歡迎參加我們的 2025 年第一季業績電話會議。我們很高興地報告，第一季淨收入和每股收益同比增長 4.3%，這得益於我們穩健的運營以及在移動、固定線路和 ICT 業務中的領先地位。儘管第一季宏觀經濟環境因全球關稅問題而快速變化，但我們認為不會產生實質影響。我們相信這甚至可能為我們的國際業務帶來新的機會。

At the same time, our strong financial performance position us to continue investing to seize new opportunities, particularly those from enterprise customer who may be expanding their manufacturing bases globally. Meanwhile, we will continue to execute our sea, land and sky advanced network strategy to prepare for the future and enhance network resilience, leveraging our leading technology strength.

同時，我們強勁的財務表現使我們能夠繼續投資以抓住新的機遇，特別是那些可能在全球擴大製造基地的企業客戶的機會。同時，我們將繼續實施海陸空先進網路策略，利用領先的技術實力，為未來做好準備，增強網路韌性。

In January, we collaborated with partner to successfully integrate ST-2, high-orbit satellite with 5G base station. This achievement enabled world-leading end-to-end two-way video call based on the 3GPP 5G new radio for non-terrestrial network standard communication protocol, advancing the connection between land and sky, GEO satellite and 5G communication. Furthermore, in April, we concluded a strategic partnership with the US innovator Astranis to bring a dedicated micro GEO satellite to Taiwan, complementing our existing multi-orbit satellite architecture.

1月份，我們與合作夥伴成功將ST-2高軌衛星與5G基地台整合。這項成果實現了基於3GPP 5G新無線電非地面網路標準通訊協定的世界領先的端對端雙向視訊​​通話，推動了陸地與天空、GEO衛星與5G通訊之間的連接。此外，今年四月，我們與美國創新公司阿斯特拉尼斯（Astranis）達成戰略合作夥伴關係，將一顆專用微型地球靜止軌道衛星帶到台灣，補充我們現有的多軌道衛星架構。

As for sea, we announced our investment in E2A, the trans-Pacific undersea cable connecting Asia to North America to meet the growing demand from OTT players and the digital transformation, including the foreseeable AI boom. To our great delight, we are proud to receive multiple awards in the first quarter acknowledging our leadership in the business and the ESG performance.

至於海上，我們宣布投資 E2A，這是一條連接亞洲和北美的跨太平洋海底電纜，以滿足 OTT 播放器日益增長的需求和數位轉型，包括可預見的人工智慧熱潮。令我們非常高興的是，我們很自豪在第一季度獲得了多個獎項，以表彰我們在業務和 ESG 表現方面的領導地位。

For international honors, our outstanding 5G smart port solution was recognized by Asia telecom awards as the technology innovation of the year. We were also ranked top five for S&P Global ESG score in the sustainability yearbook 2025 for the third consecutive years, and secured the highest A ranking from CDP for both climate and supply engagement leadership for the second consecutive year.

在國際榮譽方面，我們卓越的5G智慧港口解決方案榮獲亞洲電信獎，並被評為年度技術創新。我們也連續第三年在《2025 年永續發展年鑑》中位列標準普爾全球 ESG 評分前五名，並連續第二年在 CDP 的氣候和供應參與領導力排名中榮獲最高的 A 級。

Finally, we would like to highlight that Chunghwa Telecom is the first Taiwanese telco certified under the most stringent international anti-bribery standard showing our determination to deliver outstanding corporate governance. Going forward, Chunghwa Telecom will continue to maintain its leading position across all key benchmarks in the industry.

最後，我們要強調的是，中華電信是台灣第一家獲得國際最嚴苛反賄賂標準認證的電信營運商，展現了我們致力於卓越公司治理的決心。展望未來，中華電信將持續維持產業各項關鍵指標的領先地位。

Now let's move on to the business overview of the first quarter of 2025. Please turn to page 5 to review our leading position in Taiwan's mobile market. According to the statistics from Taiwan's telecom regulator, by March, we had successfully acquired the largest revenue share in Taiwan's mobile market at 40.5% as well as the largest subscriber share at 39.1%, both exhibited the year-over-year and quarter-over-quarter growth, reflecting our strong and healthy growth momentum.

現在我們來看看2025年第一季的業務概況。請翻到第5頁回顧我們在台灣行動市場的領先地位。根據台灣電信監管機構的統計，截至3月份，我們已成功取得台灣行動通訊市場最大的收益份額40.5%，以及最大的用戶份額39.1%，同比和環比均有增長，反映出我們強勁而健康的增長勢頭。

In addition, our 5G market share reached 38.7%, maintaining its leading position in the market. Our mobile service revenue in the first quarter increased about 2% year-over-year, mainly due to the subscriber number increase and continued the 5G migration. In addition, we are pleased to report a 42% increase in the average monthly fee uplift from the 5G migration, contributing to the stability of our overall mobile ARPU, which delivered a slight quarter-over-quarter increase in the first quarter.

此外，我們的5G市佔率達到38.7%，並持續維持市場領先地位。我們第一季的行動服務營收年增約2%，主要得益於用戶數量的增加和5G遷移的持續。此外，我們很高興地報告，5G 遷移使平均月費上漲了 42%，這有助於我們整體行動 ARPU 的穩定，第一季行動 ARPU 環比略有增長。

Let's move on to slide 6 for update of our outperforming fixed broadband business. In the first quarter, our cross-tier upgrade promotion package continue to be well received with near 70% of the package adopters choosing service offering of 300 megabits per second and above, including the highest speed offering of 1 gigabit per second. As a result, on a year-over-year basis, our subscribers with speed of 300 megabits per second and above increased by 16%, while those with speeds of 1 gigabit per second grows significantly.

讓我們繼續看第 6 張投影片，了解我們表現優異的固定寬頻業務的最新情況。第一季度，我們的跨層升級促銷套餐繼續受到好評，近70%的套餐採用者選擇了300兆比特每秒及以上的服務，其中最高速度為1千兆比特每秒。因此，與去年同期相比，我們網速 300 兆比特每秒及以上的用戶增加了 16%，而網速 1 千兆比特每秒的用戶則大幅增長。

Given the continued speed upgrade from our subscribers, our fixed broadband revenue and ARPU exhibit another quarterly increase by 2.5% and 2.1% year-over-year, respectively. And we are confident that this growth will persist.

由於用戶速度持續提升，我們的固定寬頻收入和 ARPU 本季分別年增 2.5% 和 2.1%。我們相信這種增長將持續下去。

Now let's take a close look at the performance of our business group. Slide 6 provides a deep overview of highlights from our customer application services. In the first quarter, we continued to see positive growth in each value-added services offering. Our multi-play packaging with service offering of mobile fixed broadband and WiFi continued to deliver outstanding year-over-year growth of 33%, and driven by our strong network quality and effective reward point strategy. Video business maintained its growth trajectory. Subscriptions increased by 12.5% year-over-year driven by the sports content and our exclusive release of popular dramas.

現在讓我們仔細看看我們業務集團的表現。幻燈片 6 深入概述了我們客戶應用服務的亮點。第一季度，我們持續看到各項增值服務均實現正成長。由於我們強大的網路品質和有效的獎勵積分策略，我們提供的包含行動固定寬頻和 WiFi 服務的多業務套餐繼續實現了 33% 的出色同比增長。視訊業務保持成長軌跡。受體育內容和獨家發行熱門劇集的推動，訂閱量同比增長 12.5%。

Our effective content strategy led to a 45% increase of Hami video subscribers compared with the same quarter last year, which is encouraging. As a result, our overall video revenue in the first quarter rose steadily. In addition, our consumer cybersecurity subscription also surged by 21% year-over-year during this quarter, steadily increasing its revenue contribution as expected.

我們有效的內容策略使得哈密影片訂閱用戶數量與去年同期相比增加了45%，這是令人鼓舞的。因此，我們第一季的整體視訊收入穩步上升。此外，本季我們的消費者網路安全訂閱量也較去年同期成長了21%，其營收貢獻如預期般穩定成長。

Slide 6 illustrated the key highlights in our enterprise ICT business. We are excited to report strong enterprise ICT business performance in the first quarter. Revenue increased by 13% year-over-year, driven by project revenue recognition -- rationalization, robust performance across our major pillars and the continued growth in recurring revenue. We believe our strategy to increase our recurring revenue is important as it can help stabilize overall ICT performance.

幻燈片 6 展示了我們企業 ICT 業務的重點亮點。我們很高興地報告第一季企業ICT業務表現強勁。營收年增 13%，得益於專案收入確認合理化、主要支柱的強勁表現以及經常性收入的持續成長。我們相信增加經常性收入的策略非常重要，因為它可以幫助穩定整體 ICT 表現。

For closer look at each emerging application service offering, in the first quarter, we are excited to see year-over-year revenue growth in our cybersecurity, IDC and cloud business of 40%, 29% and 13%, respectively.

仔細觀察每一項新興的應用服務產品，我們高興地看到，第一季我們的網路安全、IDC 和雲端業務的收入分別年增 40%、29% 和 13%。

Cybersecurity revenue achieved the 13th consecutive quarter of year-over-year growth, mainly driven by the project completed for financial institution and franchise chain store client, along with contribution from streaming consumer. Meanwhile, IDC and cloud revenue were boosted by the contribution -- from a contribution from the smart government project, accomplished by the increasing recurring revenue from both IDC and the International public cloud service, the latter experienced particularly strong growth.

網路安全收入連續13個季度實現年增長，主要得益於金融機構、特許連鎖店客戶完成的項目，以及串流媒體消費者的貢獻。同時，IDC和雲端收入也受到智慧政務專案的推動，這得益於IDC和國際公有雲服務的經常性收入不斷增加，其中後者成長尤為強勁。

Notably, as the first telecom in Taiwan to be honored as AWS Premier Tier Service Partner. We hold the most AWS certificates demonstrating our leading cloud technology within the industry. Additionally, our 5G private network also delivered double-digit revenue growth driven by the revenue recognition from the international clients, as well as year-over-year revenue growth in our AIoT service business, fueled by project in finance and retail sector.

值得一提的是，它是台灣第一家榮獲AWS Premier Tier Service Partner榮譽的電信公司。我們擁有最多的 AWS 證書，證明了我們在業界領先的雲端技術。此外，受國際客戶收入確認的推動，我們的5G專網也實現了兩位數的收入成長，而受金融和零售領域項目的推動，我們的AIoT服務業務的收入也實現了同比增長。

And we were delighted to report the network integration contract worth over TWD1 billion secured in the first quarter from a leading financial holding company, which we expect to inject revenue and profit in the near future. In addition, leveraging our leading data analysis capability, we were proud to win Taipower AMI expansion project again, recognizing our expertise in energy management.

我們很高興地報告，第一季從一家領先的金融控股公司獲得了價值超過 10 億新台幣的網路整合合同，我們預計這將在不久的將來帶來收入和利潤。此外，憑藉我們領先的數據分析能力，我們很榮幸再次贏得台電AMI擴建項目，證明了我們在能源管理方面的專業知識。

Notably, we were honored with four major awards at the CIO Taiwan's 2025 Elite Vendor Award, including the outstanding service provider for the fourth consecutive year, where we were the exclusive winner from telecom industry.

值得一提的是，我們在 CIO 台灣 2025 精英供應商獎中榮獲四項大獎，包括連續第四年獲得傑出服務提供商稱號，並且是電信行業的唯一獲獎者。

Slide 9 illustrated our international subsidiary performance. In the first quarter, revenue from our overseas subsidiary increased by 8.2% year-over-year, mainly due to the growing ICT services provided to the high-tech customers in the United States and Southeast Asia market.

幻燈片 9 展示了我們的國際子公司的業績。一季度，海外子公司營收年增8.2%，主要得益於向美國、東南亞市場高科技客戶提供ICT服務的成長。

In light of the global economic landscape change, we have observed business opportunity from the growth -- growing Taiwanese investment in the United States and sold projects in our pipeline, mainly progressing as a result of the relocation of AI supply chain, including the AIDC construction, the strong telecom global. Our subsidiary in the United States expanded our Arizona office in April and launched a new office in May in Texas office to support business development.

鑑於全球經濟格局的變化，我們觀察到了成長帶來的商業機會——台灣在美國的投資不斷增長，而我們已售出的項目主要由於人工智慧供應鏈的遷移而取得進展，包括AIDC建設、強大的全球電信。我們在美國的公司於四月擴建了亞利桑那州的辦公室，並於五月在德克薩斯州開設了新辦公室以支持業務發展。

In addition, our business in Singapore, Vietnam and Thailand are all experienced double-digit revenue growth in the first quarter, largely driven by the providing ICT services for Taiwanese enterprise to build new factories in the Southeast Asia market.

此外，集團在新加坡、越南及泰國的業務第一季營收均錄得雙位數成長，主要由於集團為台企在東南亞市場興建新廠提供ICT服務所帶動。

To support the overseas business, we announced our investment in the new submarine cable system, E2A in March. This trans-Pacific fiber optical network will connect the submarine cable system between North America and Asia. Our strategy is to enable diverse connectivity options, strengthen Taiwan's position as a key submarine cable hub in the Asia Pacific region and further enhance overall network resilience to response to the growing demand of the network services.

為了支持海外業務，我們在3月宣布投資新的海底電纜系統E2A。此跨太平洋光纖網路將連接北美和亞洲之間的海底電纜系統。我們的策略是實現多樣化的連接選擇，加強台灣作為亞太地區主要海底電纜樞紐的地位，並進一步增強整體網路的彈性，以應對日益增長的網路服務需求。

Now let's move on to page 11 for the financial performance of our three business groups. In the first quarter, our CBG delivered a 4.9% year-over-year increase of its income before tax, which is quite healthy as our mobile ARPU will steadily develop and fixed broadband ARPU expected to continue to hold up.

現在我們翻到第 11 頁，了解我們三個業務集團的財務表現。第一季度，我們的 CBG 稅前收入年增 4.9%，這是一個相當健康的成長，因為我們的行動 ARPU 將穩步發展，固定寬頻 ARPU 預計將繼續保持。

In addition, our ICT business continued to expand. We are delighted to see EBG total revenue increased by 2.3% year-over-year, mainly underpinned by the strong ICT business revenue growth of 11.6% year-over-year. This growth was offset by continued decline in EBG fixed voice revenue, which called to a 3.8% year-over-year decrease in the income before tax.

此外，我們的ICT業務持續擴大。我們很高興看到 EBG 總收入年增 2.3%，這主要得益於 ICT 業務收入年增 11.6%。這一增長被 EBG 固定語音收入的持續下降所抵消，導致稅前收入年減 3.8%。

IBG's total revenue and income before tax both increased modestly in the first quarter due to its robust international IDC business growth and the continued strong demand for the integrated ICT services in the global market.

受惠於國際IDC業務的強勁成長以及全球市場對ICT綜合服務持續旺盛的需求，IBG第一季總營收和稅前利潤均達到小幅成長。

Now I would like to hand the call over to Audrey for the financial update.

現在我想把電話交給奧黛麗來報告財務最新狀況。

Thank you, President. Good afternoon, everyone. It is my pleasure to present an overview of our financial results for the first quarter of 2025. Please refer to slide 12, income statement highlights. Let me walk you through the key financial metrics for the quarter.

謝謝您，總統。大家下午好。我很高興向大家介紹我們 2025 年第一季的財務表現。請參閱投影片 12，損益表重點。讓我向您介紹本季的關鍵財務指標。

Revenue reached over TWD55 billion, making the fifth consecutive year of growth. This represents a year-over-year increase of 1.6%, driven primarily by the expansion of our ICT business, along with solid performance in mobile and broadband services. Income from operations and net income rose by 5% and 4.3%, respectively, compared to the same period last year. These improvements were fueled by the strong performance of our IDC Internet data center business and sustained growth in mobile and video service subscriptions.

營收突破550億新台幣，連續第五年成長。這比去年同期成長了 1.6%，主要得益於我們的 ICT 業務的擴張以及行動和寬頻服務的穩健表現。營業收入和淨收入分別比去年同期成長5%和4.3%。這些改進得益於我們IDC互聯網資料中心業務的強勁表現以及行動和視訊服務訂閱的持續成長。

Earnings per share increased by TWD1.21 to TWD1.26, reflecting consistently profitability and our disciplined cost management. EBITDA and EBITDA margin both recorded modest gains during the quarter. Notably, both EBITDA and net income reached their highest level in nine years for a first quarter period, underscoring the resilience and strength of our core operations.

每股收益增加 1.21 新台幣至 1.26 新台幣，反映出持續的獲利能力和嚴格的成本管理。本季度，EBITDA 和 EBITDA 利潤率均錄得小幅成長。值得注意的是，第一季的 EBITDA 和淨收入均達到了九年來的最高水平，凸顯了我們核心業務的韌性和實力。

Now let's turn to slide 13, balance sheet highlights. Total assets increased by 0.5% as of March 31, 2025, compared to the year-end 2024. The growth was primarily driven by an increase in other current monetary assets, which further strengthened our liquidity position.

現在讓我們翻到第 13 張投影片，資產負債表重點。截至 2025 年 3 月 31 日，總資產與 2024 年底相比成長了 0.5%。成長主要得益於其他流動貨幣資產的增加，這進一步增強了我們的流動性狀況。

Property, plant and equipment declined by 1.1% as depreciation expense exceeded net additions of fixed assets during the quarter. This reflects our continued emphasis on capital discipline and asset efficiency. Total liability decreased by 5.5%, mainly due to a reduction in accounts payable.

由於本季折舊費用超過了固定資產淨增加額，物業、廠房和設備下降了 1.1%。這反映了我們對資本紀律和資產效率的持續重視。總負債減少5.5%，主要由於應付帳款減少。

Our current ratio improved further and remain above 100%, highlighting healthy short-term liquidity and financial flexibility. In addition, the debt ratio declined slightly and net debt over EBITDA remains at zero. Taken together, these metrics highlight our solid financial position and prudent capital structure.

我們的流動比率進一步改善並維持在100%以上，凸顯了健康的短期流動性和財務靈活性。此外，負債比率略有下降，淨負債與EBITDA之比仍為零。綜合起來，這些指標凸顯了我們穩固的財務狀況和審慎的資本結構。

Now let's move to slide 14, cash flow summary. Cash flows from operating activities decreased by 8.6% year-over-year, primarily due to higher settlements of accounts payable during the quarter.

現在我們來看第 14 張投影片，現金流量摘要。經營活動現金流量較去年同期下降8.6%，主要由於本季應付帳款結算金額增加。

Capital expenditures increased by 7.2% year-over-year primarily due to the front-loaded deployment of 5G, 4G equipment in the first quarter. This reflects our planning mobile network enhancement schedule with a greater portion of the buildup occurring early in the year. Importantly, we remain committed to disciplined capital management and full year mobile-related CapEx is still expected to be lower than in 2024. As a result of these factors, free cash flow declined by 17.4% year-over-year. This was in line with expectations given the investment planning. We continue to maintain a strong cash position and stable operating inflows, which provides a solid foundation to support business growth and shareholder return.

資本支出較去年同期成長7.2%，主要由於第一季5G、4G設備的前期部署。這反映了我們規劃的行動網路增強計劃，其中大部分建設工作將在年初進行。重要的是，我們仍然致力於嚴格的資本管理，預計全年移動相關的資本支出仍將低於 2024 年。由於這些因素，自由現金流較去年同期下降了 17.4%。這符合投資計畫的預期。我們繼續保持強勁的現金狀況和穩定的經營流入，為支持業務成長和股東回報提供了堅實的基礎。

So now let's turn to slide 15, performance relative to Q1 2025 guidance. For the first quarter of 2025, revenue was broadly in line with the guidance we provided earlier this year. Meanwhile, income from operations, net income, EPS and EBITDA all surpassed our Q1 guidance by a modest margin. This outperformance was primarily driven by the steady growth of our core business, improved profitability in our ICT business and lower-than-expected operating costs, reflecting our ongoing efforts to optimize operation and maintain disciplined cost control.

現在讓我們翻到第 15 張投影片，相對於 2025 年第一季指引的表現。2025 年第一季的營收與我們今年稍早提供的預期基本一致。同時，營業收入、淨收入、每股盈餘和息稅折舊攤提前利潤均略高於我們的第一季預期。這項優異表現主要得益於我們核心業務的穩定成長、ICT 業務獲利能力的提高以及低於預期的營運成本，這反映了我們持續努力優化營運並維持嚴格的成本控制。

This concludes the financial overview for the first quarter of 2025. We are pleased to report a solid start to the year. So we now open the floor for questions, and welcome your insights.

2025 年第一季的財務概覽到此結束。我們很高興地報告今年有一個好的開始。我們現在開始提問，並歡迎您發表見解。

(Operator Instructions) Okay, then if there are no further questions, I'll turn it back over to President Lin. Thank you.

（操作員指示）好的，如果沒有其他問題，我會把時間交還給林總裁。謝謝。

Okay. If there is no question, then, thank you for your participation. Thank you.

好的。如果沒有問題，那麼感謝您的參與。謝謝。

Thank you, President Lin. And ladies and gentlemen, we thank you for your participation in Chunghwa Telecom's conference. There will be a webcast replay within an hour. Please visit www.cht.com.tw/ir under the IR Calendar section. You may now disconnect. Thank you again. Goodbye.

謝謝林校長。女士們、先生們，感謝各位朋友參加中華電信的本次大會。一小時內將會有網路直播重播。請造訪 www.cht.com.tw/ir 下的 IR 日曆部分。您現在可以斷開連線。再次感謝您。再見。