TEL remains one of the strongest dividend engines in our Micro Harvesting portfolio, but a high dividend alone does not make a stock fundamentally strong.
In this post, we examine whether PLDT’s earnings, operating cash flow, capex direction, debt load, and business mix can continue supporting the role we assigned to TEL as a Low Volatility Dividend Harvester.
Originally published: July 27, 2026 · Last updated: July 27, 2026
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Ang Punto ng Fundamental Analysis
Hindi natin ginagawa ang fundamental analysis para lamang masabi kung maganda o pangit ang isang kumpanya.
Sa Micro Harvesting, mas practical ang tanong:
Kaya ba ng negosyo na suportahan ang role na ibinigay natin dito sa portfolio?
Para sa TEL, ang role ay malinaw.
Hindi natin ito pangunahing hinahawakan bilang mabilis na rotation stock. Itinuturing natin itong Low Volatility Dividend Harvester at recovery anchor—isang malaking position na inaasahang magbigay ng regular cash dividends habang hinihintay ang price recovery at valuation repair.
Kaya ang fundamental analysis natin ay nakatuon sa limang bagay:
- revenue durability;
- operating cash generation;
- dividend capacity;
- capital-expenditure requirements;
- at leverage.
Hindi sapat na mataas ang dividend. Kailangan itong suportado ng matatag na operating business at tunay na cash flow.
Ano ang Negosyo ng PLDT?
Ang PLDT Group ay hindi na simpleng landline company.
Ang negosyo nito ay nakasentro sa tatlong major segments:
- Wireless
- Fixed Line
- Others
Sa Wireless side, kabilang ang mobile services, fixed wireless broadband, at related services.
Sa Fixed Line side, kasama ang home broadband, enterprise data, voice, data centers, cloud, cybersecurity, managed IT, at iba pang digital services.
Sa Others, kabilang ang investments sa digital platforms at financial technology, tulad ng Maya-related interests at iba pang technology ventures.
PLDT also operates through subsidiaries and platforms such as Smart, ePLDT, VITRO, and PLDT Global. ePLDT provides cloud, cybersecurity, data, and artificial-intelligence solutions, while VITRO operates carrier-neutral data centers, including the AI-ready hyperscale facility in Santa Rosa.
This diversified structure is an important fundamental strength.
Ang TEL ay hindi lamang nakaasa sa prepaid mobile load o traditional voice revenues. Ang cash engine nito increasingly depends on mobile data, fiber broadband, enterprise connectivity, data centers, cloud, cybersecurity, and digital infrastructure.
Ang Revenue Trend
PLDT’s consolidated revenues increased steadily from:
- ₱181.00 billion in 2020
- ₱192.19 billion in 2021
- ₱204.36 billion in 2022
- ₱210.95 billion in 2023
- ₱216.83 billion in 2024
- ₱218.39 billion in 2025
This is not explosive growth, but it is persistent.
From 2020 to 2025, revenues increased by roughly 21%. The pattern suggests that PLDT is already a mature company, but not a stagnant one. Its growth profile is gradual and infrastructure-driven rather than hypergrowth.
Service revenues also increased from ₱173.63 billion in 2020 to ₱212.19 billion in 2025.
For a Low Volatility Dividend Harvester, this is generally favorable.
Hindi kailangan ng TEL ang napakabilis na revenue growth. Ang kailangan nito ay:
- stable or gradually rising revenues;
- high recurring service income;
- at sufficient cash generation to fund both capex and dividends.
Sa Q1 2026, consolidated revenues reached ₱56.51 billion, up around 2% from ₱55.28 billion in Q1 2025.
So far, the latest quarter did not indicate a collapse in the top line. Growth remained modest but positive.
EBITDA at Operating Strength
EBITDA is one of PLDT’s principal operating-performance measures.
The historical trend shows:
- ₱88.78 billion in 2020
- ₱96.18 billion in 2021
- ₱100.59 billion in 2022
- ₱104.30 billion in 2023
- ₱108.52 billion in 2024
- ₱111.23 billion in 2025
This is a much cleaner operating trend than reported net income.
From 2020 to 2025, EBITDA increased by approximately 25%. The EBITDA margin remained near the low-50% range, reflecting the high fixed-cost but strongly cash-generative nature of the telecom business.
Q1 2026 EBITDA reached ₱28.29 billion, up around 2% year on year, while EBITDA margin remained at 52%.
This is one of the strongest parts of the TEL fundamental case.
The business continues to produce substantial operating cash earnings even while revenues grow slowly.
Pero may mahalagang warning.
EBITDA is not free cash flow.
PLDT itself notes that EBITDA excludes depreciation, financing costs, taxes, and capital expenditures. Because telecom is highly capital-intensive, hindi natin puwedeng gamitin ang EBITDA na parang cash available na agad sa shareholders.
So EBITDA tells us that the engine is running.
It does not yet tell us how much cash remains after keeping the network alive.
Net Income, Core Income, at Telco Core Income
PLDT reports several earnings measures:
- reported net income;
- core income;
- telco core income.
Reported net income can be affected by one-off or nonrecurring items such as:
- tower-sale gains;
- accelerated depreciation;
- foreign-exchange movements;
- derivative gains or losses;
- impairments;
- and other accounting adjustments.
This was particularly visible in 2022, when reported net income dropped to ₱10.74 billion, even though EBITDA and telco core income remained comparatively strong.
Reported net income later recovered to:
- ₱26.82 billion in 2023
- ₱32.56 billion in 2024
- ₱30.22 billion in 2025
By comparison, telco core income moved more steadily:
- ₱28.09 billion in 2020
- ₱30.35 billion in 2021
- ₱33.30 billion in 2022
- ₱34.34 billion in 2023
- ₱35.14 billion in 2024
- ₱33.93 billion in 2025
This is why telco core income matters to us.
PLDT uses telco core income as one of the bases for determining dividend payouts. It adjusts reported earnings for nonrecurring items and certain non-telco effects, including Maya-related results and asset-sale gains.
From an MH dividend perspective, telco core income is more relevant than headline net income.
But it should not be treated as a substitute for actual cash flow. It is still a management-adjusted earnings measure.
Ang Papel ng Wireless at Fixed Line
The PLDT Group’s operating structure shows an important transition.
Wireless remains a major revenue contributor, but Fixed Line has become increasingly important because it includes:
- home broadband;
- enterprise data;
- cloud;
- data-center services;
- cybersecurity;
- and managed digital solutions.
In 2024, Wireless generated approximately ₱105.73 billion in revenues, including ₱97.78 billion in service revenues. Mobile service revenues increased by 2% to ₱96.25 billion.
However, the segment contribution to core earnings shows that Fixed Line has become a major economic driver.
In 2024, the Fixed Line segment accounted for a much larger amount of segment core income than Wireless before intersegment eliminations.
This is fundamentally important.
The PLDT story is no longer merely:
Smart versus competing mobile networks.
It increasingly includes:
fiber broadband, enterprise connectivity, cloud, AI infrastructure, cybersecurity, and data centers.
That diversification reduces dependence on one revenue stream—but it also requires ongoing investment.
Broadband, Mobile, at Subscriber Trends
Subscriber numbers need careful interpretation.
PLDT’s reported mobile subscribers declined from more than 72 million in 2020 to around 57.8 million in 2023, before recovering to around 59.0 million in 2024 and 59.9 million in 2025.
The decline partly reflects structural and regulatory changes, including SIM registration and market cleanup, rather than simply economic collapse.
More important is the movement in broadband.
Fixed-line broadband subscribers increased from approximately:
- 2.27 million in 2020
- 2.97 million in 2021
- 3.25 million in 2022
- 3.27 million in 2023
- 3.43 million in 2024
- 3.79 million in 2025
This suggests that the structural demand for fiber and home broadband remains intact.
The fixed-line voice subscriber base has gradually declined, but that is expected in a world moving toward mobile and internet-based communication.
The more relevant question is whether higher-value data revenues can replace legacy voice.
So far, the answer appears to be yes—but at a mature growth rate rather than an explosive one.
Capex Normalization
Capex is one of the most important fundamental variables for PLDT.
Reported capital expenditures rose sharply during the network-investment cycle:
- ₱71.90 billion in 2020
- ₱88.98 billion in 2021
- ₱96.81 billion in 2022
Then capex began to decline:
- ₱85.08 billion in 2023
- ₱78.25 billion in 2024
- ₱60.34 billion in 2025
This is a potentially favorable transition.
The network has already absorbed several years of heavy investment in:
- fiber;
- LTE and 5G;
- transport capacity;
- international connectivity;
- data centers;
- cybersecurity;
- and enterprise infrastructure.
If capex normalizes without damaging service quality or competitiveness, more operating cash flow can become available for:
- dividends;
- debt reduction;
- or selective growth investments.
Pero hindi natin dapat sabihing tapos na ang capex.
Telecom assets require continuous maintenance and upgrading. Data usage grows, technology changes, and network resilience requires recurring investment.
The proper conclusion is:
PLDT appears to be moving away from peak capex, but not into a low-capex business model.
This distinction matters.
Cash Flow at Dividend Sustainability
For dividend harvesting, cash flow is more important than accounting earnings.
PLDT’s operating cash flow improved materially in 2025. Based on our cash-flow normalization, net cash from operating activities reached approximately ₱98.74 billion, while cash paid for property and equipment plus capitalized interest was around ₱62.86 billion.
This left a simple cash-flow proxy of approximately ₱35.87 billion before financing and other adjustments.
Using the trailing period through March 2026, our normalized operating-cash-flow-less-cash-capex estimate was approximately ₱37.83 billion.
That amount is relevant because the annual regular dividend requirement at approximately ₱95 per share is roughly ₱20.5 billion for 216.06 million shares.
The relationship suggests that the regular dividend remains supportable under the current cash-generation and capex profile—provided that:
- operating cash flow remains stable;
- capex does not surge back toward peak levels;
- and debt servicing remains manageable.
PLDT’s regular dividends were broadly stable in recent years, while special dividends in 2022 and 2023 were linked to nonrecurring events and should not be treated as permanent. The 2025 annual dividend was around ₱94–₱95 per share, close to our normalized sustainable estimate.
This supports TEL’s dividend-harvester role.
But the dividend is not risk-free.
It competes with capex and debt for the same cash.
Ang Mabigat na Bahagi: Debt at Leverage
The biggest fundamental weakness is leverage.
Net debt increased from:
- ₱181.65 billion in 2020
- ₱228.66 billion in 2021
- ₱225.67 billion in 2022
- ₱239.76 billion in 2023
- ₱273.03 billion in 2024
- ₱284.69 billion in 2025
Over the same period, nominal short- and long-term debt reached approximately ₱296.94 billion by end-2025.
This means the company’s operating strength is accompanied by a heavy financing burden.
Financing costs also increased. In 2024, financing costs were approximately ₱15.5 billion, versus ₱13.8 billion in 2023 and ₱11.8 billion in 2022.
The consequence is clear:
Higher interest expense can absorb part of the benefit from EBITDA growth and capex normalization.
From an MH perspective, debt matters in three ways.
First, it reduces the equity value attributable to shareholders.
Second, it limits flexibility in dividends and capital allocation.
Third, it makes TEL sensitive to interest rates, refinancing conditions, and peso weakness.
Leverage does not automatically invalidate the TEL thesis. Telecom businesses often carry substantial debt because they operate long-lived infrastructure assets.
But TEL cannot be treated like a debt-light consumer company.
Ang Emerging Growth Engines
The most interesting part of the long-term fundamental story lies outside traditional telecom.
VITRO and data centers
VITRO operates a nationwide carrier-neutral data-center network and launched an AI-ready hyperscale data center in Santa Rosa.
This gives PLDT exposure to:
- cloud migration;
- artificial intelligence workloads;
- enterprise digitization;
- data localization;
- and hyperscale demand.
ePLDT, cloud, and cybersecurity
ePLDT provides cloud, cybersecurity, data, and AI solutions to enterprise and public-sector clients. It also operates a sovereign-cloud offering designed to keep sensitive data within Philippine jurisdiction.
These businesses may have stronger structural growth than traditional voice or SMS.
Maya
Maya remains a source of optionality.
PLDT’s investment interest in Maya’s holding company stood at 37.66% at end-2025. Maya reported revenue growth from ₱8.55 billion in 2023 to ₱14.09 billion in 2024 and ₱17.58 billion in 2025, while moving from large losses to a reported gain in 2025.
This is not yet the central reason for holding TEL.
But it may become a source of future value if profitability proves sustainable.
Fundamental Strengths
The strongest parts of the TEL fundamental case are:
Durable recurring revenues.
Service revenues have continued to rise despite the maturity of the telecom market.
High and stable EBITDA generation.
EBITDA exceeded ₱111 billion in 2025 and remained near a 52% margin in Q1 2026.
Growing fixed-broadband base.
Fiber and broadband subscribers continued expanding.
Capex normalization.
Reported capex declined materially from the 2022 peak.
Dividend-supporting telco core income.
Telco core income has remained broadly stable above ₱33 billion in recent years.
Emerging digital infrastructure.
Data centers, cloud, cybersecurity, AI infrastructure, and Maya provide additional optionality.
Fundamental Risks
The main weaknesses and risks are:
High leverage.
Net debt continued to rise and reached approximately ₱284.69 billion in 2025.
Increasing financing costs.
Higher interest expense can offset operating improvements.
Mature revenue growth.
PLDT is growing, but slowly.
Capital intensity.
Even after normalization, capex remains substantial.
Competitive pressure.
Mobile, broadband, enterprise, and digital infrastructure remain highly competitive.
Dividend dependence on multiple conditions.
The payout depends not only on earnings, but also on capex, liquidity, debt, and management policy.
Sensitivity to regulation and technology.
Telecom companies operate under regulatory oversight and must continuously adapt to new technology.
Ang MH Fundamental Verdict
Based on the available financial statements through Q1 2026, TEL remains fundamentally qualified for its role as a Low Volatility Dividend Harvester.
The reasons are:
- recurring service revenues;
- stable EBITDA;
- resilient telco core income;
- improving cash conversion;
- declining capex from peak levels;
- and a regular dividend that appears supportable under the current operating profile.
But this qualification is not unconditional.
TEL’s high debt and financing burden prevent us from treating it as a low-risk stock in the absolute sense.
The correct classification is closer to:
A mature, cash-generative, dividend-paying infrastructure company with improving capex economics—but with material leverage that must remain under continuous governance.
For MH, that means:
- dividends remain the primary harvest;
- rotation is secondary;
- additions should require valuation and technical permission;
- and capital allocation should remain disciplined because the existing position is already large.
Fundamentally, TEL passes.
But it passes with a debt warning.
Pangwakas na Kaisipan
The TEL fundamentals tell a balanced story.
The business is not deteriorating.
Revenue and EBITDA remain resilient. Broadband continues to grow. Capex has declined from the peak investment cycle. Telco core income remains strong enough to support regular dividends. Digital infrastructure businesses provide future optionality.
But the company also carries significant debt, rising financing costs, and continuing capital requirements.
So the fundamental conclusion is not:
TEL is unquestionably cheap and safe.
The better conclusion is:
TEL remains a strong operating and dividend platform, but its value to common shareholders depends on continued cash-flow discipline, capex normalization, and control of leverage.
This is why fundamental analysis cannot stand alone.
The next step is technical analysis.
Fundamentals tell us whether TEL deserves a place in the portfolio.
Technical analysis will help determine whether the present price location gives us permission to act.
The PSE has confirmed that its Shariah screening program is currently paused, with no new lists to be released until their internal review is completed. Although news outlets reported quarterly updates up to mid-2025, these later lists are no longer accessible on the PSE website.
For now, the PSE’s Shariah-Compliant Securities page and all past lists have been removed from the public website. The December 24, 2024 list is the last official version in Micro Stock Trader’s possession, downloaded before the page was taken down, although other investors may still hold later copies such as the reported July 4, 2025 release.
All halal-focused strategies under Micro Stock Trader will use a conservative, self-screened approach until official guidance resumes, in shā’ Allāh.
This post is for educational and documentation purposes only. It is not investment advice. Perform your own due diligence and consult qualified financial professionals before making investment decisions. All strategies, frameworks, and examples described here reflect the personal methodologies of Micro Stock Trader and are not guarantees of future performance.
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