Converge ICT Solutions Inc. sustained the growth in its residential subscriber base while maintaining robust growth for its enterprise business, especially for small and medium enterprises (SMEs), to achieve an 8% revenue growth to P17.4 billion in the first half of the year.
Total net subscriber additions for residential customers reached 92,000 during the first six months, growing by 5% compared to last year. For the second quarter alone, there were 49,000 residential net additions. The prepaid fiber internet subscribers reached more than 54,000 as of end-June, nearly doubling compared to end-March 2023 level. This brings the total residential subscriber base of Converge to 1.97 million.
“Converge continues to reap impressive results in our effort to bolster the availability and affordability of our fiber internet solutions. We anticipate more opportunities to grow our subscriber base as we innovate products to cater to the demand from specific socioeconomic segments. This is evident in the second quarter subscriber growth – with the prepaid market gaining significant traction,” said Converge CEO and Co-Founder Dennis Anthony Uy.
The fiber broadband provider recently introduced its prepaid fiber offering Surf2Sawa to serve households looking for more affordable connectivity, providing flexible top-up options from as low as P50 per day to P700 for 30-day unlimited connectivity. This is good for six devices with an average speed of 25 Mbps.
Converge also introduced a more affordable postpaid broadband called Bida Fiber which was tailored for budget-conscious households with a more consistent income. Priced at P888 per month, subscribers can connect up to six devices with an average speed of 35 Mbps, and experience quality and unlimited connection.
“The market for Surf2Sawa prepaid fiber internet and Bida Fiber represents around 70% of the total population, representing vast opportunities for us and we are in the best position in the industry to take advantage of this. This opens another blue ocean for Converge,” Uy added.
Converge SEVP and COO Jesus Romero said that having Bida Fiber and Surf2Sawa arms Converge with a full portfolio of products that can cater to almost all economic class households. “The targets for these products are value-conscious customers who are not yet connected by fiber broadband but likely to be using mobile or fixed wireless connectivity at home which can be burdensome,” he adds.
“Our goal with the full product portfolio is to ensure that all subscribers are connected with the most appropriate plan that they can afford in the long-term,” noted Converge President and Co-Founder Grace Uy.
Meanwhile, Converge Business continued to deliver outstanding growth in 1H2023 across all segments. The SME segment continued to lead growth with year-on-year (YoY) revenues increasing by 41.5%, followed by the wholesale segment increasing by 28.6% in the same period. Revenues from large enterprise customers, making up the largest sub-segment, grew by 18.5% YoY.
Net income after tax climbed to P 4.3 billion in the first six months of the year from P3.95 billion in the first half of 2022, representing a net income margin of 24.7 percent.
Converge also increased its EBITDA (earnings before interests, taxes, depreciation, and amortization) by 9.5% to P10.1 billion in the January to June period, thereby improving its consolidated EBITDA margin to 57.9%.
Meanwhile, Converge remains industry-leading in terms of latest available reports on Return on Invested Capital (ROIC) which improved to 15.4% as of end-June with capital expenditures mostly attributable to the 800,000 new fiber ports deployed. This industry-leading performance is a result of the Company’s disciplined approach in deploying capital to expand its fiber network and improve its overall services.
