Megacable Holdings (MEGACPO) Q2 2026 earnings summary

Executive summary

• Achieved continued growth in a challenging environment, surpassing 6 million internet subscribers and expanding the fiber network to cover 19.8 million homes passed, with 88% of subscribers now on GPON technology.

• Achieved double-digit net income growth and maintained a healthy financial profile despite dividend payments.

• Focus shifted from network expansion to extracting value from existing assets, improving penetration, and operational efficiency, supported by digitalization and AI initiatives.

• Transitioned to a phase focused on capitalizing investments and generating free cash flow.

• Subscriber growth remained within the communicated range, with disciplined capital allocation and a conservative balance sheet.

Financial highlights

• Consolidated revenue for Q2 reached MXN 9.3 billion, up 7.2% year-over-year; mass market revenue grew nearly 8%, and corporate revenue rose 4%.

• EBITDA was MXN 4.2 billion, up 5.9% year-over-year, with a margin of 44.9% (down from 45.4% last year due to a one-time promotion impact).

• Net income was MXN 852 million, up 11% year-over-year, supported by lower financing costs.

• Gross profit reached MXN 6.79 billion, up 8% from Q2 last year.

• Market capitalization increased 19.3% year-over-year to MXN 53.99 billion.

Outlook and guidance

• CapEx for 2026 is expected in the 23%-25% of revenue range, with a further reduction to 22%-24% for 2027.

• Margin expansion is targeted, aiming to return to 47%-48% EBITDA margin in the coming years, supported by efficiency and AI initiatives.

• Net subscriber additions are expected to remain in the 100,000-150,000 per quarter range, with a focus on quality growth and retention.

• Focus on capitalizing prior investments and strengthening free cash flow generation.

• Expectation of stabilized revenues in the Enterprise segment.