Philippine telcos turn to fintech as core growth stalls

Digital finance is now doing the heavy lifting as mobile and broadband flatten. 

Philippine telecom operators are increasingly relying on fintech and digital financial services for growth as core mobile and broadband revenues remain stable but slow-growing, according to Maybank Investment Banking Group.

In a report titled “Sunrise on the reaping,” Maybank maintained a positive view on the sector, citing high dividend yields and steady performance from core telecom operations.

Maybank said PLDT Inc., Globe Telecom, and Converge ICT Solutions have seen broadly stable mobile and broadband trends, with limited shifts in competitive positioning.

Globe retains about 51% mobile revenue share from financial year (FY) 2024 to the first quarter (Q1) 26, whilst Dito Telecom has made modest gains at PLDT’s expense.

Broadband growth continues to be driven mainly by prepaid subscribers, resulting in low average revenue per user and low single-digit segment expansion. The report expects continued slow but steady growth in FY26 and FY27.

The report also said regulatory changes, including the Konektadong Pinoy Act and potential new entrants, are unlikely to materially alter competition given high market penetration.

Dito Telecom remained loss-making, posting a P2.9b operating loss in Q1 26 after five years of operations.

Maybank noted that fintech is becoming a key growth driver for the sector as traditional telecom revenues plateau.

Globe Telecom’s fintech arm Mynt (GCash) returned to earnings growth in Q1 26 after earlier regulatory headwinds, with its contribution now at times exceeding Globe’s core earnings.

PLDT’s Maya Digital Bank has nearly doubled earnings year-on-year and contributes about 3% to group earnings.

The report maintained Buy ratings on PLDT, Globe and Converge, noting PLDT’s estimated dividend yield of about 9%, above the Philippine government 10-year benchmark of around 7.5%, whilst Globe and Converge yield around 6%.