Millicom (Tigo) Q1 2025 Earnings Release

Rhea-AI Summary

Millicom (Tigo) reported strong Q1 2025 financial results with revenue of $1.37 billion and net income of $193 million, including $95 million in one-time gains. The company achieved an operating profit of $423 million and Adjusted EBITDA of $636 million. Customer growth was robust with 262,000 Postpaid Mobile and 62,000 Home FTTH/HFC net additions. Despite a 7.6% decline in reported revenue, organic revenue declined only 1.6%. The company generated equity free cash flow of $135 million, excluding disposal proceeds, a significant improvement from Q1 2024. Leverage stands at 2.47x. Millicom maintains its 2025 targets of approximately $750 million in EFCF and year-end leverage below 2.5x, despite challenges from weaker foreign exchange rates.

Positive

• Net income increased significantly to $193 million from $92 million in Q1 2024
• Operating profit grew 30.8% to $423 million
• Strong customer growth with 262,000 Postpaid Mobile and 62,000 Home net additions
• Equity free cash flow improved by $172 million to $135 million
• Adjusted EBITDA grew 6.9% organically to $636 million
• Restructuring program completed in 2024 delivered incremental cost savings

Negative

• Revenue declined 7.6% to $1.37 billion (1.6% organic decline)
• Weaker foreign exchange rates impacting three largest country markets
• Operating Cash Flow decreased 2.9% to $504 million
• Potential risk of adverse legal rulings noted in outlook
• Higher Capex spending, up 16.7% to $132 million

Insights

Telecommunications Financial Analyst

Millicom delivered mixed Q1 results with impressive EFCF growth of $172M year-over-year despite currency pressures, maintaining 2025 targets amid revenue challenges.

Millicom's Q1 2025 results reveal a company effectively navigating currency headwinds while focusing on operational efficiency. The 7.6% reported revenue decline to $1.37 billion appears concerning at first glance, but the much smaller 1.6% organic decline indicates significant currency translation effects rather than fundamental business deterioration.

The most impressive metric is the equity free cash flow (EFCF) of $135 million (excluding disposals), representing a $172 million improvement from Q1 2024's negative $37 million. This dramatic improvement demonstrates the effectiveness of the restructuring program completed in 2024, which delivered cost savings that offset foreign exchange challenges in three major markets.

The divergence between reported and organic results is particularly evident in Adjusted EBITDA, which grew only 0.6% on a reported basis but 6.9% organically. This substantial gap further confirms the material impact of currency depreciation across key markets. Despite these headwinds, operating profit increased 30.8% to $423 million.

Net income more than doubled to $193 million, though this includes approximately $95 million in one-time gains, suggesting a more modest underlying improvement. The current leverage ratio of 2.47x is already below the year-end target of "below 2.5x," providing financial flexibility.

From an operational perspective, Millicom achieved robust customer growth with 262,000 postpaid mobile and 62,000 home FTTH/HFC net additions. However, the flat organic service revenue growth (0.0%) compared to Q1 2024 suggests potential average revenue per user (ARPU) pressure despite the growing customer base.

The 16.7% increase in capital expenditure to $132 million indicates continued investment in infrastructure and growth initiatives despite revenue challenges. This higher capex, combined with the strong customer additions, suggests management is prioritizing future growth potential over short-term margin expansion.

Millicom maintained its 2025 financial targets of approximately $750 million in EFCF and year-end leverage below 2.5x, despite acknowledging risks from weaker projected foreign exchange rates and potential adverse legal rulings. Given the strong Q1 performance, particularly in EFCF, these targets appear achievable barring significant currency deterioration.

 

Millicom (Tigo) Q1 2025 Earnings Release

Luxembourg, May 8, 2025 – Millicom is pleased to announce its first quarter 2025 results. Please find below links to the Q1 2025 Earnings Release and IAS 34 Interim Condensed Consolidated Financial Statements.

Q1 2025 Highlights*

• Revenue $1.37 billion

• Operating profit $423 million, and Adjusted EBITDA $636 million

• Net income $193 million, including approximately $95 million in one-time gains

• Equity free cash flow $135 million, excluding $42 million of net proceeds from disposals - leverage 2.47x

• Robust customer net additions: 262,000 Postpaid Mobile and 62,000 Home FTTH/HFC

Financial highlights ($ millions)	Q1 2025	Q1 2024	Change %	Organic % Change
Revenue	1,374	1,487	(7.6)%	(1.6)%
Operating Profit	423	324	30.8%
Net Profit	193	92	NM
Non-IFRS measures (*)
Service Revenue	1,285	1,376	(6.6)%	0.0%
Adjusted EBITDA	636	632	0.6%	6.9%
Capex	132	113	16.7%
Operating Cash Flow (OCF)	504	519	(2.9)%
Equity free cash flow (EFCF)**	135	(37)	NM

         *See page 9 for a description of non-IFRS measures and for reconciliations to the nearest equivalent IFRS measures. ** EFCF excluding disposals.

Millicom Chief Executive Officer Marcelo Benitez commented:
"2025 is off to an excellent start, as we sustained strong commercial activity levels from H2 2024, with both mobile postpaid and home net additions near record levels. In addition, the restructuring program completed in 2024 produced incremental cost savings, which more than offset the impact of weaker foreign exchange rates in three of our largest country markets. Excluding disposals, EFCF of $135 million in Q1 2025 represents an increase of $172 million compared Q1 2024, which puts the company well on track to achieve its full year targets.”

2025 Financial Targets

Millicom continues to target 2025 EFCF of around $750 million and year-end leverage below 2.5x. These targets reflect full year run-rate savings expected from efficiency measures implemented during 2024 and lower expected restructuring costs in 2025, partially offset by the impact of weaker projected foreign exchange rates and the risk of adverse legal rulings. The targets exclude the impact of strategic initiatives, such as proceeds related to the planned sale of Lati International and other assets.  

• Q1 2025 Earnings Release

• IAS 34 Interim Condensed Consolidated Financial Statements

Millicom is planning to host a video conference for the global financial community on May 8, 2025, at 14:00 pm (Luxembourg) / 13:00 (London) / 08:00 (Miami).
Registration for the interactive event is required at the following link. Participants may also join the conference in listen-only mode by dialing any of the following numbers and entering the Webinar ID: 844 3411 0044

US: +1 929 205 6099                                                   Sweden: +46 850 539 728
UK: +44 330 088 5830                                                 Luxembourg: +352 342 080 9265

Additional international numbers are available at the following link. Accompanying slides and a replay of the event will be available on the Millicom investors website.

For further information, please contact:

Press: Sofía Corral, Communications Director press@millicom.com

Investors: Michel Morin, VP Investor Relations investors@millicom.com

About Millicom

Millicom (NASDAQ: TIGO) is a leading provider of fixed and mobile telecommunications services in Latin America. Through its TIGO® and Tigo Business® brands, the company provides a wide range of digital services and products, including TIGO Money for mobile financial services, TIGO Sports for local entertainment, TIGO ONEtv for pay TV, high-speed data, voice, and business-to-business solutions such as cloud and security. As of March 31, 2025, Millicom, including its Honduras Joint Venture, employed approximately 14,000 people and provided mobile and fiber-cable services through its digital highways to more than 46 million customers, with a fiber-cable footprint over 14 million homes passed. Founded in 1990, Millicom International Cellular S.A. is headquartered in Luxembourg with principal executive offices in Doral, Florida.

Attachments

• Millicom - IAS34 - Q1 2025
• Millicom - Earnings Release - Q1 2025

FAQ

What were Millicom's (TIGO) key financial results for Q1 2025?

In Q1 2025, Millicom reported revenue of $1.37 billion, operating profit of $423 million, and net income of $193 million. Adjusted EBITDA was $636 million, and equity free cash flow was $135 million.

How did TIGO's customer base grow in Q1 2025?

Millicom achieved strong customer growth with 262,000 Postpaid Mobile net additions and 62,000 Home FTTH/HFC net additions during Q1 2025.

What is Millicom's (TIGO) financial target for 2025?

Millicom targets equity free cash flow of around $750 million and year-end leverage below 2.5x for 2025.

How much did TIGO's revenue decline in Q1 2025?

Millicom's revenue declined 7.6% to $1.37 billion on a reported basis, while organic revenue declined 1.6% compared to Q1 2024.

What was TIGO's equity free cash flow in Q1 2025?

Millicom generated equity free cash flow of $135 million in Q1 2025, excluding $42 million of net proceeds from disposals, representing a $172 million improvement from Q1 2024.