America Movil Q1 Profit Jumps 25% on Strong Earnings

Key Financial Highlights

Mexican telecom giant America Movil announced a 25.1% increase in its first-quarter net profit, reaching 23.40 billion pesos or $1.31 billion. This growth was primarily fueled by improved operating earnings and reduced financing costs.

The company's revenues for the quarter rose 2.1% to 236.84 billion pesos, surpassing analyst forecasts. EBITDA also exceeded expectations, reaching 95 billion pesos against a predicted $5.28 billion.

Operational Performance Overview

America Movil demonstrated strong subscriber growth by adding 3.0 million postpaid mobile clients, with Brazil leading the expansion with 1.3 million new customers. The company also expanded its fixed-line services, adding 594,000 new broadband accesses.

This postpaid growth offset a minor loss of 90,000 prepaid subscribers during the same period.

Economic and Strategic Context

The company's financial results were impacted by the strengthening Mexican peso, which appreciated approximately 12% through March. This currency movement diluted the value of overseas earnings when converted back to pesos.

Strategically, America Movil continued its expansion in key markets, agreeing to acquire Brazilian internet provider Desktop for $753 million in March.

Summary and Outlook

Despite currency headwinds, America Movil's robust Q1 results underscore strong operational performance and successful subscriber acquisition. The company's focus on strategic acquisitions signals a continued commitment to growth in Latin America.

FAQ

Q: What was America Movil's net profit in Q1?
A: The company reported a net profit of 23.40 billion pesos, a 25.1% increase from the previous year.

Q: Which country led subscriber growth?
A: Brazil was the main driver of postpaid growth, adding 1.3 million new clients.

Source: Investing.com