Few people realize it, but outside of China and India, América Móvil, S.A.B de C.V. (NYSE: AMX) is one of the largest wireless operators in the world.
Headquartered in Mexico City, América Móvil serves almost 298 million postpaid and prepaid wireless subscribers and nearly 81 million fixed line connections in 25 countries in Central and South America, the U.S., the Caribbean, and in parts of Central and Eastern Europe.
América Móvil offers its customers a portfolio of value-added services and enhanced communications solutions from a high-caliber integrated telecommunications platform. The company’s infrastructure assets comprise roughly 196,000 base stations, over 290,000 fiber route-miles, eight satellites, 28 data centers and 11,000 route-miles of submarine cables.
AMX reported 2Q21 consolidated revenues of US$ 12.6 billion* (MxP 253 billion), essentially flat on a year-over-year basis with 2Q20. Consolidated EBITDA came in at nearly $4.3 billion, a 2.8 percent YoY increase. The company reported 2Q21 total capital expenditures of $2.9 billion across all its operations. AMX’s full-year 2021 capex budget is $7.5 billion.
Of that aggregate revenue, service revenues were $10.5 million, or 83 percent of the consolidated 2Q21 total. AMX derives its revenues from both wireless and wireline operations in roughly a two-thirds/one-third split.
Prepaid revenues grew roughly 10 percent YoY and four percent sequentially and contributed 36 percent of total 2Q21 service revenues. The company attributed the steady quarter-to-quarter increase in prepaid revenue to economic recovery currently underway in Mexico and the U.S., but also in Central America and the Caribbean, and in Eastern Europe, areas where prepaid services are affordable and easy to obtain.
Post-paid services expanded over 4 percent compared to 2Q20 and accounted for 31 percent of total service revenues in the quarter.
In its wireline business, the company promotes Fixed Bundles that include broadband, pay-TV and voice in double- or triple play bundles. Fixed Bundles accounted for 31 percent of services revenues while Fixed Voice made up the two percent balance.
Broadband is the wireline growth business while pay-TV and wireline voice declined 5-6 percent on a YoY basis.
Mexico, Brazil, and Colombia are AMX’s three biggest markets for both wireless and wireless services. The three countries together account for 61 percent of wireless subscribers and 78 percent of total fixed line connections.
AMX operates under different brands in these countries. In Mexico, the company goes back to its origins under the Telmex (Telefonos de Mexico) brand for wireline and Telcel name for wireless. In both Brazil and Colombia, AMX operates as Claro for both wireless and wireline operations.
AMX is the leading provider of integrated telecommunications services throughout Latin America under the Claro brand. The company has nearly 75 million wireless subscribers in Central and South America, and in the Dominican Republican and Puerto Rico in the Caribbean. In most of these countries, prepaid wireless service is the most attractive economic option.
AMX’s European presence is a little far afield but interesting, nonetheless. The company owns 51 percent of Telekom Austria, based in Austria, and holds a 21 percent share of KPN in the Netherlands, both of which offer wireless and wireline services under their own brands.
Telekom Austria operates over 22 million postpaid and prepaid wireless and more than 6 million fixed line customers in Austria situated in Central Europe and in six eastern European countries including Slovenia, Croatia, Serbia, Bulgaria, Macedonia, and Belarus.
AMX’s presence in the U.S. is strictly a prepaid play under the Tracfone name. A year ago, Verizon (NYSE: VZ) made a bid for Tracfone’s then almost 21 million prepaid subscribers. (See, Puzzling Over Verizon’s Tracfone Deal). Of the total Tracfone subscriber pool, Verizon Wireless provides the underlying network service to roughly 13 million customers.
In the year since, and through the pandemic, the Tracfone subscriber count declined to 20.3 million in 2Q21, down nearly three percent from when the deal was announced. Tracfone generated $2.1 billion in revenues in 2Q21, up about one percent compared to 2Q20. The deal is expected to close in the latter half of 2021.
* all figures in U.S.$
By John Celentano, Inside Towers Business Editor
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