PLDT Inc (PHI) 2025 Q2 法說會逐字稿

Good afternoon, everyone, and thank you for joining us today. I'm Jinggay Nograles, Head of Investor Relations here at PLDT, and it's my pleasure to welcome you to our first-half financial and operating results briefing.

Joining us today to share insights into PLDT's performance and strategic direction are PLDT Chief Operating Officer, Mr. Butch Jimenez; PLDT Financial Officer, Mr. Danny Yu; PLDT Corporate Secretary, Marilyn Victorio-Aquino; PLDT Chief Legal Counsel, Atty. Joan De Venecia-Fabul; PLDT Head of Consumer Home, Mr. John Palanca; PLDT Head of Enterprise, Blums Pineda; PLDT President, Viboy Genuino; and PLDT Treasurer, Leo Posadas.

Later during the call, we will also be joined by Smart Communications Chief Operating Officer, Mr. Boy Martirez. Go ahead, Danny.

Good afternoon, everyone. Allow me to present PLDT's first-half 2025 performance covering key results and business highlights. Our service revenues net of interconnection costs reached PHP97.1 billion, a touch higher year on year. EBITDA came in at PHP55.5 billion, up 3% from last year. EBITDA margin remained steady at 52%. This was supported by steady growth from our Fiber and disciplined cost management.

Cash OpEx subsidies provisions (inaudible), 3%, reflecting continued spending discipline. Telco core income landed (inaudible), down 4%, mainly due to higher depreciation and financing costs (inaudible) investment in our network in infra to improve quality of service. Core income, on the other hand, reached PHP17.6 billion, up 1%, lifted by Maya's positive earnings.

PLDT share in Maya's core earnings amounted to PHP406 million in the first half, its first profitable semester, marking a PHP1.1 billion turnaround from the PHP693 million loss last year. This strong result reflects continued growth in deposits, lending, and payments volume. In summary, we delivered stable core results and maintained our EBITDA margin, driven by careful cost management and ongoing revenue growth in key areas.

PLDT service revenues remained stable, driven by sustained demand across three segments: Mobile data, Fiber, corporate data, and ICT. Starting with Home, revenues grew 4% year on year, reaching PHP30.4 billion, led by strong steady Fiber demand. Enterprise was slightly lower at PHP23.5 billion, down 1% due to continued declines in legacy businesses.

Positively, corporate data and ICT revenues held steady despite last year's closure of affordable connectivity. Within these segments, ICT stands out growing 15% year on year to PHP3.2 billion. While our connectivity business is in transition, we continue to build a pipeline of new opportunities powered by emerging tech solutions.

Turning to Individual, revenues totaled PHP42.3 billion, slightly down in part due to weaker legacy offerings. Mobile data (inaudible) to PHP37.4 billion, now making up 89% of the segment's revenues. We remain encouraged by the robust adoption of 5G and the continued increase in data usage, supporting future growth and better (technical difficulty). Overall, mobile data and fiber and corporate data ICT now represent 90% of our total revenues versus 88% last year, more than offsetting legacy declines. Excluding legacy services, total net service revenues rose by 3%.

Now let's take a closer look at the Home segment. Home revenues grew 4% year on year to PHP13.4 billion, led by strong fiber demand. Fiber revenues reached PHP29.5 billion, up 7% versus last year and now make up 97% of total home revenues. Subscriber momentum remains strong with 169,000 net Fiber adds in the first half, over 3 times higher than last year's 50,000 net adds. This growth reflects the impact of our accelerated port rollout program.

We continue to lead in ARPU and churn. ARPU held steady at PHP1,485 for the semester, the highest in the industry. Churn improved quarter on quarter, a testament to network reliability and brand strength. Our bundled offerings also continue to resonate while over 80% of new subscribers opted for higher value (inaudible) PHP1,299 and above. These integrated broadband mobile and content bundles help drive customer stickiness and support revenues.

Enterprise revenues for the first half reached PHP23.5 billion, slightly down by 1% from last year due to known headwinds. This includes the full impact of lost POGO connectivity as well as lower public sector deal closures tied to the May elections and leadership changes in government agencies. We expect these delayed awards to be booked in the second half.

Corporate data and ICT remained stable at PHP17.4 billion and now account for 74% of total enterprise revenues. ICT continues to be a bright spot with segment revenues up 15% year on year. Data center colocation grew by 36%, while cybersecurity services expanded by 24%. Other growth areas include: Fiber, up 4% year on year; SDWAN, up 19% as demand for secure flexible enterprise connectivity continues to rise.

We also saw meaningful traction from Asia Direct Cable, which supported high bandwidth deal closures with hyperscalers and carriers in the second quarter. While connectivity revenues are in transitional phase, our broader enterprise business remains resilient, supported by advanced digital solutions and a growing customer pipeline.

In April, PLDT through its data center arm VITRO, inaugurated VITRO Santa Rosa, the country's first operational AI-ready hyperscale facility and the largest in our portfolio. This rated 3 certified mega facility delivers 50 megawatts of power capacity and houses over 4,500 racks built to meet the stringent requirements of enterprises, hyperscalers, the public sector, and AI workloads.

The facility now hosts live NVIDIA GPUs powering ePLDT's AI solutions, giving Philippine enterprises across to on-demand, high-performance AI computing without the heavy capital cost of building their own infra. As the country's first true AI enabler, VITRO offers low latency and the computing skills needed for enterprise to innovate and compete.

VITRO continues to deliver strong growth with colocations revenues up 36% in the first half, driven by a 19% increase in rack deployments across our data center network. With VITRO Santa Rosa and our broader ecosystem, PLDT is building the infra backbone to position the Philippines as a regional hub for digital services and AI innovation.

Individual revenues reached PHP42.3 billion for the first half, down 1% from last year, reflecting continued drag from legacy services and a softer second quarter. Mobile data revenues were stable at PHP37.4 billion, making up 89% of the segment. While Q2 was slightly slower, we continue to see healthy data usage and stickiness from our customer base. ARPU have remained broadly stable despite competitive pressures, thanks to our hyperpersonalized offers that match customer needs while helping us manage marketing costs more efficiently.

Total mobile data traffic grew 5% year on year to 2,766 petabytes, supported by the continued rise in 5G adoption. 5G traffic surged 84% versus last year and 5G [last] devices now make up 17% of our base, up from 11% a year ago. This reflects network improvements and the impact of affordable 5G device offers.

Another bright spot is fixed wireless. With the introduction of our new 5G modem, we saw revenues from this segment growing 12% year on year, driven by the strength and reliability of our 5G network, especially in areas where Fiber is not yet available. We remain focused on giving customers the best experience, not only in network quality, but also in how we design products that match their preferences and needs.

This approach allows us to maintain ARPU, spur demand, and increase loyalty. Innovations remain a key lever as we took shape the next phase of growth.

To share more about our latest digital initiatives targeting younger Filipinos, I'd like to turn it over to our Smart COO, Mr. Boy Martirez.

After months of hard work by our internal teams and technology partners, it is my pleasure to present to you the first of a series of innovations that we have embarked on, our (inaudible) mobile service called KiQ. KiQ is the Philippines first and only app-based mobile service that offers a personalized digital telco experience. KiQ is also one of the first in the world to offer such groundbreaking experience.

KiQ is our ode to the Gen Z market. The Gen Z between 19 to 20 years old is this young generation redefining how they live, share, and stay connected. They are disruptors, and we've seen their influence in powering the results of our latest Philippine elections. Their rebellious yet authentic nature, their ability to know exactly when to swipe left or to double tap, make up a generation that will never compromise freedom and control.

With this in mind, we have built KiQ, a mobile experience that gives Gen Z complete freedom and flexibility to personalize and control their mobile journey on their own terms. With the KiQ app, users can build their own plan, choose their own data allocation, choose their call and text inclusions, choose their numbers, choose their validity period and more, unlocking a very personalized experience for Gen Zs. It's my pride to show you our television commercial that was launched last Sunday.

(video playing)

There will be more innovations that we will be introducing. In fact, the ink hasn't even dried up on this innovation that we launched last Sunday. We'll be launching another one this coming Monday. So stay tuned.

Thanks, Boy. As we continue to innovate on the product side, we're also staying focused on disciplined cost management. Now let me walk you through our operating expenses. Total cash OpEx, subsidies, and provisions for the first half came in at PHP41.6 billion, down PHP1.4 billion or 3% from the same period last year. Breaking it down, compensation and benefits, excluding MRP, declined by PHP900 million or 8%, helped by ongoing rightsizing efforts.

Selling and promotions were down 22%, reflecting better campaign targeting and improved spend efficiency. Subsidies fell 21%, mainly due to lower device issuance and better control on subsidy per unit. On the other hand, repairs and maintenance rose by 4% to PHP15.6 billion, driven by network expansion and new site rollouts.

Overall, the 3% year-on-year reduction in cash operating expenses highlights our ongoing efforts to optimize spend while ensuring support for growth areas like Fiber, mobile data, enterprise ICT, and digital innovations. For the first half, consolidated EBITDA reached PHP55.5 billion, up 3% year on year despite flattish top-line growth and known headwinds. This reflects the resilience of our business model with earnings supported by a stronger mix of Fiber, ICT, and personalized mobile offers.

This growth was driven mainly by lower OpEx with total cash OpEx down by PHP1.4 billion or 3% year on year. Our EBITDA margin held steady at 52%, underscoring our ability to defend profitability in a competitive market. This stability gives us a strong platform heading into the second half, where we expect additional upside from enterprise deal closures and traction from new product launches.

Telco core income for the first half came in at PHP17.2 billion, slightly lower year on year as higher depreciation and financing costs weighing on the results. That said, a clear bright spot is Maya, which delivered PHP406 million in core income, its first profitable semester and a meaningful turnaround from a loss last year.

Maya has now cemented its position as the largest digital bank and merchant acquirer in the country. Its gamified all-in-one ecosystem continues to attract, retain, grow users creating a profitable and sustainable financial platform that is now materially contributing to PLDT's core income now and moving forward.

Including Maya's contribution, consolidated core income rose to PHP17.6 billion, up 1% versus the same period last year. Reported income was slightly lower at PHP18.1 billion, mainly reflecting lower net ForEx and derivative gains. We'll share more on Maya's performance and growth momentum in a dedicated section later in this presentation.

Now let's move on to CapEx and our debt profile. CapEx for the first half of 2025 stood at PHP27.4 billion. We're now guiding full-year CapEx of about PHP63 billion, lower than our original guidance of PHP68 billion to PHP73 billion. This reduction is not due to scaling back our efforts, but rather the result of more favorable pricing and negotiated terms with vendors and suppliers.

We remain focused on network quality and expansion with continued momentum in new site rollouts, LTE and 5G upgrades, Fiber port builds, and investment in submarine cables and AI infra. We're also investing in AI-ready data center and upgrades that improve service quality and long-term efficiency. CapEx intensity for the first half declined to 26%, in line with our plan to bring down the ratio down and support stronger free cash flow.

As of end of June, our net debt stood at PHP282.6 billion with a net debt-to-EBITDA ratio of 2.57 times. Our interest cover remains healthy at 3.52 times, giving us ample headroom to manage debt service. We have continued to manage maturities proactively with 55% of our debt maturing beyond 2030 and only 5% maturing in 2025. US-dollar-denominated debt is modest at 13% with only 5% unhedged.

Our overall debt portfolio remains diversified with a balanced mix of fixed and floating rates and an average tenure of 6.4 years. We remain investment-grade rated by both S&P and Moody's, underscoring confidence in our fundamentals and risk profile. We maintain our guidance of returning to positive free cash flow by 2026 and are working toward our target net debt-to-EBITDA ratio of 2.0 times over a medium term.

The Board declared an interim cash dividend of PHP0.48 per share earlier today, in line with our regular payout policy of 60% of telco core income. This corresponds to a telco core earnings per share of PHP80 for the first half and reflects our commitment to stable shareholders' return while managing leverage. Based on PLDT's closing share price as of June 30, the 12-month trailing yield stands at about 8%.

Now let me discuss Maya, the fintech -- rather the number one fintech ecosystem in the Philippines comprising of Maya, the leading digital bank; and Maya Philippines, the top omnichannel payment processor.

What makes Maya unique? It is a fully integrated platform that unites digital payments, banking, and lending for both consumers and businesses. This creates a powerful flywheel, more user drive more transaction, generating richer insights, enabling better product adoption, and ultimately delivering scale and profitability. These strong networks effects are firmly established across both consumer and business segments.

Next, Maya remains the Philippines' number one digital bank and leading payment processor in [banking] and QR merchant payments. As of June 2025, Maya had 8.2 million [banks of] customers, 2.1 million borrowers, PHP50.4 billion in deposit and PHP150 billion in total loans disbursed since inception. In 2Q of 2025, Maya posted its second consecutive quarter of sustainable profitability with PHP582 million in net income, a growth of 60% over the first quarter of 2025.

Now let me now break down Maya's banking performance. Maya's deposits rose to PHP50.4 billion by end of June, up 54% year on year, showing sustained growth and stronger customer trust. Loan disbursement hit PHP32 billion in Q2, up 147% year on year, bringing total life-to-date disbursal to PHP152 billion across consumer loans, MSME loans, and partner-led loan channeling. Outstanding loans grew to PHP25 billion, raising LDR to 49% and boosting net interest margin to 20.2%.

NPL inch up to 5.2% with new products and services, but these remain healthy. Maya also expected to stabilize as the portfolio matures. In summary, Maya is unlocking the full value of its platform by linking consumer and merchant ecosystems. Maya recently launched the Maya Black credit card, a premium lifestyle card and the Maya Black Preferred Rewards program, giving cardholders up to 10 times rewards within the ecosystem.

Maya remains the only digital bank in the Philippines issuing credit cards with over 230,000 issued since August 2024, many to first-time users. Maya is also expanding credit access to partners like Pepsi, Tala, JuanHand. In a sports strategic alliance such as the Landers co-branded card and Pulse Mabuhay Miles integration. With its ecosystem firing all cylinders, Maya is setting the pace for future of digital finance in the Philippines.

Now allow me to cite a few sustainability highlights during the quarter. PLDT and Smart signed agreements with MPower to source additional renewable energy for operations. This will result not only in cost savings but also support our decarbonization road map. PLDT's progress in the area of sustainability is manifested in several recognitions. PLDT was again included in the FTSEGood (sic - FTSE4Good) Index where our score was higher than the telecom industry, the mobile subsector, and country averages.

Its PHP2 billion social loan was cited as the Social Infra Deal of the Year by The Asset in 2025 in the ASEAN region category. During the quarter, PLDT submitted its communication on progress, which affirmed its commitment to the United Nations Global Compact's 10 principles on human rights, labor, environment, and anticorruption. The PLDT team was named the overall winner of the UNGC Innovation Accelerator for young professionals and will be the Philippines submission to the UNGC Leaders Summit in New York on September. More details of our initiatives can be found in the sustainability section of this presentation.

Now that concludes our prepared remarks for the first half of 2025. We appreciate your continued interest and support, and we would be happy to open the floor for your questions. Thank you.

Thank you, Danny and Boy, for all the valuable insights and growth initiatives as well as key developments that you've shared across our business units. As you've seen today, despite some near-term challenges, we remain confident in our market position, supported by our strong operational fundamentals, strategic investments in digital infrastructure, and promising growth in Maya.

Now we'd like to open the floor to your questions. (Event Instructions)

Arthur Pineda, Citi.

Two questions, please. Firstly, on mobile. I'm just wondering what's driving the softness in trends for wireless revenues? I mean, if you look at the revenues, it's down slightly on a Q on Q basis, but 1Q was saddled with a lot of work and school outages. Why aren't we seeing the uplift in revenues? And any guidance into the third quarter with regard to these trends?

Second question I had is with regard to regulation. Can you get an update on Konektadong Pinoy Bill? Is there a deadline for the President to sign this or amend or return to Congress? How do you see this as playing out?

Thank you, Arthur. I guess you can take the first question on mobile?

Arthur, may I just ask you to speak a little bit slowly so I can get the first part of your question?

It's about the softness in mobile, mobile trends. So quarter to quarter, it looks like there was some softness. First quarter did have some challenges regarding mobility. So he was asking if the Q had similar effects and also your outlook for the third quarter.

Okay. Thank you. Well, the dip is a normal fluctuation. We see that as normal fluctuation, and we expect it to go right back up. And more importantly, in the second half, where our innovations sit, we expect to have a better outlook in the second half. And I guess that just outlines our view. First time around that we met Arthur, I remember you asked me what I would do differently.

So the most important thing that I'd like to outline here is, although Smart is a tech company, we are also a consumer-centric company. And as a consumer-centric company, we aim to therefore, delight the customer. Delighting the customer is based on the innovations that we have. And the innovations -- each innovation is going to deliver value for money. The value for money is going to be the driver of how we will get the revenues up and how we will do market repair.

Thank you, Sir Boy. For the second question on Konektadong Pinoy?

I'll answer that question. The first question is when will it become a law, right?

Any deadlines for the President?

Any deadline, well, by August 24, if the President has not vetoed the law -- the bill, it will become a law by the passage of time. And what's the other question -- that's it.

Do you have any follow-up questions on Konektadong Pinoy, Arthur, or just the deadline?

I'm just wondering how you see this? Will there be any amendments which could take place? Do you just see this as passing through to law? Or do you think it's likely going to stall?

Well, our hope is the President will return this. Will veto the law and allow the Congress to enact a law -- enact a bill that will replace it in consultation with stakeholders, including the telcos. And we were heartened by the fact that the office of the Deputy Executive Secretary for Legal Affairs sent a letter to Smart requesting opinion or the position of Smart with respect to the bill, whether or not the President should veto the bill or approve the bill and sign it into law.

But up to now, we don't know where -- what will be the end position in this matter. But if in the event that the President signs it into law or allows it to lapse into law, then we have to -- we, as telco, will have to assert our right and bring our issues before the Supreme Court. We believe that there are several unconstitutional issues that's contained in the bill, including the discriminatory treatment in favor of data transmission providers and satellite providers because the bill allows data transmission providers and satellite providers to use spectrum in -- without any franchise.

And in that respect, the bill is also unconstitutional because it contains more than one subject. The rule in the Philippines and in most democratic countries is a bill can only contain one subject. This bill contains three subjects: One, open access; number two, spectrum, allocation of spectrum and recall of spectrum; and third, enjoyment of spectrum and operating without the franchise. So we will raise those issues.

The -- but the most important point in this is the bill goes against what the world basically has implemented as open access. The standard for open access -- the ability of data transmission providers to access the assets of telcos is very broad. As long as it's necessary, then they will have the right to access, whereas open access has adopted in other countries, a very strict standard, which is the asset must be indispensable and must be essential for these provisional services of the data and transmission providers.

It's like -- I liken it to a right of way. If there is -- if the access to the asset is a necessary right away for the provision of the services, then that is a fair access. But if it is an access which allows them to have basically access to all our assets and basically they can conduct a business without building their own infrastructure, then that's almost confiscatory because our assets are being accessed and the law is requiring us to provide access to our assets that will be used by a private sector. It's not even for public use.

So in that score, it is confiscatory and we're not even allowed to basically negotiate the terms of the access. So -- and when you have that situation, when the law was intended to provide for the additional build of infrastructure in the Philippines for data transmission providers. But the law failed to impose an obligation to build infrastructure on the data transmission providers. Instead, they are given the right to access all our assets. So it's like a freeloader situation.

And when that happens, who will suffer? Our subscribers will suffer and there will be a disincentive to build because you know how expensive it is to build. But as we build, we are not given the assurance that we will have exclusivity on use of the assets that we're building. And the signal of the law is the data transmission providers will have access over the assets that we will build. So it's a disincentive to build further improvements to the infrastructure of telcos in the Philippines.

But the other most important point here is under the constitution, the state has the ability, has the power and the right to take over facilities of entities of businesses that are engaged in public utilities or engaged in or whose business are viewed with public or national interest. That one will not be available for satellite providers because the bill allows satellite providers to get spectrum and to operate without any franchise.

So satellite providers are basically outside of the physical jurisdiction of the Philippine government. And so in our case, if the Philippine government needs our assets, needs to take over our operations in order to ensure that national security is protected, for example, [Blacksome] communications. They can just knock on our doors and send the police and take over.

In the case of satellite providers that are given spectrum and are operating without any franchise by the government, that's not possible, and that is depriving the state of the power to protect itself. So those are some of the unconstitutional points that we will raise if the bill is passed into law.

Understood. Thank you very much.

We have another question here from [mWell] of Metrobank. Can you share some guidance regarding what we can expect from refinancing activities for the maturing debt? Do we expect any upticks in our rates? Perhaps Leo, our Treasurer can take this.

So currently, interest rates are still at high levels when compared to a few years back when we (inaudible) our maturing debts. So as an indication, as of June, the cost of our debt is approximately (inaudible). Now admittedly, as we refinance debt, the interest rates are high -- still at higher levels right now, the benchmark rates. But what we have done is that we've negotiated for the spreads to contract a bit. So from a high, let's say, 75 to 100 basis points to today's 40 to 60 basis points.

Now aside from that, in order to address also the high interest rate environment, we are borrowing long-term facilities with floating rate structured price at the shorter end of the curve. Now this is also to take advantage of declining interest rates following the easing of central banks. So while they may be a little bit higher now, there is potential in the way we structured our refinancing facilities of floating rates at the shorter end that will give us the ability to also enjoy as interest rates go down.

Thank you, Leo. All right. Another question that we have here is in regards to our 5G cities. Any updates on 5G cities after the successful launch in BGC? Are there additional cities slated for this? And what can we expect in this coming year?

Yes. Glad to answer that. Following the success that we have in 5G cities, we have decided to start to propagate them in the provinces. So we have selected Iloilo, the Queen City of the South as the first beneficiary of that. We're putting 5G in Iloilo and we're testing it there. And so far, I'm glad to announce that there's been some good acceptance, particularly with respect to the fact that we started that with the sunsetting of our 3G spectrum.

Thank you. And as a follow up to that, since we are talking about 5G, are there any measurable uplift in terms of ARPU for these 5G cities also from 5G users moving up from LTE?

Short answer, ARPU 5G is PHP300. The ARPU LTE is PHP101. So definitely be assured that there will be a revenue lift. And we are very, very focused in really implementing our 5G network.

Thank you, Sir Boy. This next question I got from quite a number of investors. This is in regards to our asset monetization plans. Are there any updates on the data center sale as well as asset sales on top of the data center?

Okay. On the data center, we continue to receive inquiries from interested parties, and we also consider other options for data center. So until we have finalized, we will advise you once we have finalized those deals.

And in regards to copper?

Yeah. I think we mentioned that, no?

Okay. So for copper, we will announce -- so it's an ongoing --

Continues to be one of the priorities.

Maybe I can give them an update on the asset monetization program on our legacy assets. We've created a robust program to be able to monetize all our legacy assets. We're beginning with our copper. That is now under negotiations. And so I don't think I can disclose generally the price and how much we're going to get. But suffice it to say that we believe that we will get a substantial amount for our copper.

But over and above that, there's a full program on being able to monetize our other legacy assets. For example, we are starting to shut down 3G. There will be a lot of equipment that is related to 3G, which we will also now start to monetize. And then eventually, all our other legacy assets, we will start to monetize. So we have a program for that whole ecosystem of monetizing legacy assets.

Thank you, Butch. This next question is for Home business. This is in regards to prepaid. So it looks like there was some uplift in the press release regarding take-up on prepaid. Can you give us more color on your plans and how this fits in your portfolio?

Well, prepaid is our strategic entry point into an emerging market that consists of price-sensitive households as well as first-time Fiber users. We do not see prepaid as cannibalizing postpaid. An emerging customer base is there for those households that are hesitant to a monthly commitment or never tried Fiber and are still using older or slower technologies. Prepaid is the perfect way to onboard these customers.

And our growth driver in the next six months of the year will come from these emerging -- well, it will come from two places. It's from deepening our penetration in areas where we have coverage. And secondly, it's entering into these emerging markets consisting of price-sensitive households as well as first-time Fiber users.

Thank you, John. I'd also like to recognize the presence of our Chairman and CEO, Mr. Manny Pangilinan. So if you have any questions, please feel free to put them through the queue of the Q&A box here in the Teams meeting. Also, you may send it to me via Viber or you may raise your hand as well.

This next question is for Enterprise. Enterprise revenues declined 1% year on year. That's despite the 15% growth in ICT. You mentioned that there were some delays due to the elections and the POGOs. Do you anticipate to return to growth overall in the second half.

Yes, there were definitely on the public sector side, especially, as you can imagine, in local government, some of those deals were sliding because of the May elections and then waiting for any new elected officials to be announced. And on the national government agency as well, as you will remember, there was a loyalty check, et cetera. So while we had some closed deals substantially on the national government agency side in the first half, some of them did slide.

I think it was reported in the news that PLDT won an award for the emergency 911 services. It's the national program announced by the President in the SONA. So we're waiting for the notice to proceed on that, but we're pleased. I think that's a marker of things to come on that sector. Similarly, with private sector, same thing, I think. So we're pushing hard on these things and hoping that it will impact our results positively in the second half.

Thank you, Blums. And as a follow up to that, regarding the new services from BSR regarding GPU as a service, any color regarding how early demand is shaping up?

Thank you for that question. VITRO Santa Rosa remains the premier data center hub of the Philippines today, a 5-hectare site, 50 megawatts in terms of capacity, 4,500 racks. And it is the only AI-ready data center in the Philippines today. We are taking full advantage of that.

We are the first company in the Philippines to actually bring in NVIDIA GPU servers. And this is meant to address the growing AI demand that we see in the enterprise space today. Customers now are moving from use cases to actual deployment of AI, and we are capitalizing on that demand that's coming in. So we're happy to be the digital infra provider for AI in the Philippines today.

Thank you, Viboy. Also, I'd like to let everyone know that we also have Aayush Jhunjhunwala of Maya. He is the CIO of Maya. So if there are any Maya-related questions from the group, you may also post those questions here. (Event Instructions)

Derrick, CLSA.

I do have questions on Maya. I noticed that NIMs increased to 20%. Is it fair to say that the credit card rates have been driving this improvement? And if that's the case, is it also driving the uptick in NPLs for the period? And what could be the normalized NPLs? Then still in Maya, is it possible for you to share the split in net income between banking and merchant acquiring?

Derrick, thanks for those questions. So partly correct. The overall growth in NIMs has not just been because of increasing NIMs for credit card. Of course, that's a factor. We have launched credit card very recently. We have scaled up personal loans, which was launched late last year.

So the continued growth of these two businesses, in particular, as they're longer tenure products will continue to have some near-term adverse impact on NPLs, but we expect those to stabilize relatively quickly. I think NIMs continue to increase as we increased our LDRs, and we'll continue to drive those up.

So LDRs are driving up, individual product NIMs are improving. And so these two factors are going to continue to drive the NIMs up. I think for NPLs, we continued -- if you see, we are quite focused on managing the risk of the business, risk of the portfolio. We take great measures in making sure that the risk profile is acceptable. And so you can see that NIMs have only inched up slightly.

And I think we should expect these levels, maybe marginally up from these levels. But within the year or so, it should start to stabilize a bit more. So that's what I can sort of talk about NIMs and NPLs. I don't think we can split out at this stage much more on the P&L. But you do get to see more robust financials on the Maya Bank, which should come out soon.

And so it's effectively, we do announce -- we do release the consolidated net income. And so you'll be able to see the difference between the two businesses. Just to remind you that the payments business is not just acquiring. It includes all payment-related services. So that will include acquiring, which is obviously one of the largest business, but also consumer payments, which is consumer wallet and any other transactional revenue on the wallet.

Thank you, Aayush. We have a question from Zi Wei of Macquarie. Is there going to be any guidance on revenue and margins for the second half of 2025?

(inaudible)

Perhaps you can share something else, perhaps maybe on core income.

We're still trying to hit the core income of last year. So -- but we're slightly behind right now, but we're trying to hit the core income that we had last year.

We won't be able to provide more than that at this time as we continue to navigate the business, but we do wish to maintain our profitability, of course, and then hopefully shoot for higher [rate]. Okay. Any other questions for the group as well as for Maya?

This question here is for Home regarding innovation. So there are some innovations coming from the mobile side of things. Can you talk about innovations that you are pursuing for the Home Fiber business?

Thank you, Jinggay. Yes, we have been looking at a lot of, I guess, value-added content, but the initial mission for innovation is to make PLDT, the digital hub of every home. So what does that mean? So aside from connectivity, we are looking at -- we already have partnered with the big names in entertainment, like Netflix, MAX. We've partnered with smart home vendors like TP-Link and eufy.

Very soon, we will be partnering with a big name in the electronic gaming industry in esports and console gaming. That will be launched very shortly. And we are also looking at partnering with mWell in order to provide health from the home. So these are the few things.

We are [building] the smart home and IoT platform for every home to ensure that we are able to provide this integrated service to the home. Furthermore, there is still a market for connectivity, and you will be seeing in the market very soon, a no frills brand that we have launched. This should also help bring in our break into the emerging markets, and we hope to capture this incrementally. Again, we do not see these emerging markets of price-sensitive households or first-time users to cannibalize postpaid.

Our postpaid proposition remains very strong. Our ARPU has held up despite the fact that we have entered these markets beginning in the last quarter of last year and booming in the first and second quarter of this year. So this is a very strong indication that even lower ARPU subscribers once they're in and they determine their data usage do tend to come back and upgrade their subscriptions to faster speeds or add more content, which is helping us preserve our ARPU.

So in short, I guess that being said, it's very important that this -- making the home -- each and every home in the Philippines a digital hub for PLDT is our mission. And we intend to do that through IoT, through Smart Home, through entertainment and health, among other things.

Thank you, John. We have a question here for Maya from [Nikki]. Is there a target or optimal loan-to-deposit ratio for Maya Bank? And second question, any plans for further capital raising or perhaps even an IPO? What's the timeline looking for that?

I think for the loan-to-deposit ratio, we are still reasonably below the industry standard. So we'll continue to drive those up. I don't think we have a very fixed target at this point in time, but we are still less than 50%. So there is ample room to continue to grow. We also have an ability to dial up or dial down the deposit growth. And so it really depends on the scaling of the lending book that will enable us to maintain a healthy LDR ratios.

I think in terms of capital raise/IPO, I mean, we, at the company, continue to remain focused on scaling the business. We are solidly cash flow generative. We are profitable.

So we don't need to raise external capital to continue to drive growth. And so that's a good thing. And I think as far as any IPO or any other strategic alternatives are concerned, I think we'll let the shareholders decide and take appropriate action at the right time.

Thank you, Aayush. Okay. Looks like we have just a minute or so left. There are some questions here in the queue. This is a question from Zi Wei on Maya. So how do you see loan disbursement continuing to grow in the second half of 2025? You're tracking about the same amount of loans made with GCash in the second quarter, Maya PHP32 billion, GCash PHP34 billion. Curious to understand where you're driving the loan growth from and whether you are in direct competition with the same market as GCash?

Yeah. We have a very strong suite of products that we offer now between both consumer and businesses, starting with a Maya Easy Credit, which favors a consumer who has never taken a loan before. So first to credit customers. These are very short-term small ticket loans. Then we have personal loans where we graduate consumers for longer duration, larger ticket sizes.

We have just launched credit card. We launched Landers credit card last year, and we've just launched our own personal -- self-branded credit card last week. So it's a very robust set of products, credit products for the consumers. And similarly, we have a working capital product for businesses, both for fixed duration as well as for installment loan.

So there is no one particular product that is driving all the disbursal. It's a fairly diversified book. It's a fairly diversified disbursals, and we'll continue to see escalation across the board and growth across the board. We do focus -- just in terms of our customer segmentation, we do focus on mass affluent and above customers.

We have a very, very millennials, Gen Z-focused customer base. And so that's our continued focus. There are many products that we offer. We are the only ones, for example, amongst the digital banks or lenders to have a credit card. So we do continue to differentiate and offer products suitable to our customer base.

Thank you, Aayush. Okay. It looks like that's about all the time that we have for today. So that concludes today's briefing, and I'd like to thank everybody for their time and continued support of PLDT. But before we end the meeting, perhaps I'd like to invite our Chairman and VP, if he has any closing remarks.

[Actually], Jinggay. Thank you for joining us this afternoon. And when we announce our results, September, right? So we should see you in September with the third-quarter results. Thank you.

See you in November. November. Right, thank you, everyone. If you have any other questions that you weren't able to ask today, please feel free to send them over. I'd be happy to get to you by e-mail. Thank you. Have a great day.