Globe Telecom Inc. said it is on track to achieve free cash flow positive by 2025 as it reduces its capital spending this year.
“Our recalibrated capex strategy focuses on optimizing future investments to support the growing data requirements of our customers while ensuring we are on track to achieve our goal of being free cash flow positive by 2025,” said Rizza Maniego-Eala, Globe chief finance officer.
For full year 2024, Globe set a capital expenditure (capex) guidance of $1 billion, lower than previous years, with projections to further limit spending to below $1 billion by 2025.
The company said its capex-to-revenue ratio has gone down considerably, from 64 percent in 2022 to 44 percent in 2023, reflecting its commitment to capital efficiency.
In the first quarter, Globe spent P13.7 billion for capex that aligns with its reinforced guidance of lower capex following peak levels reached in 2022.
The first quarter investment is equivalent to 33 percent of Globe’s total service revenues for the quarter, significantly lower than the 44 percent recorded in 2023. It highlights Globe’s emphasis on capital efficiency while ensuring sustained growth and enhanced digital experiences for Filipinos.
Approximately 91 percent of the first quarter capex was used for data network expansion and enhancements, ensuring that customers can access seamless digital experiences anytime, anywhere, Globe said.
These investments primarily targeted its mobile network as the company shifted its fiber strategy from rollout and expansion to optimizing port utilization.
This year’s capex is financed through a combination of operating cash flow, proceeds from asset sales and a measured level of debt financing, Globe added.
Globe said its capex approach enables it to invest strategically in data network enhancements, ensure capital efficiency and maintain its market leadership, while delivering digital solutions to its customers across the Philippines.
