Home Forex Converge targets up to P26-B revenue this year

Converge targets up to P26-B revenue this year

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By Arjay L. Balinbin, Senior Reporter

LISTED fiber broadband provider Converge ICT Solutions, Inc. is expecting to hit P25 billion to P26 billion in gross revenue by the end of the year, up from P15.7 billion last year, as high demand continues.

“[In terms of] gross revenue, I think we might hit close to P25 to P26 billion,” Dennis Anthony H. Uy, chief executive officer and co-founder of Converge, told BusinessWorld at the fourth episode of its Crisis Insights from Philippine Tycoons series.

Mr. Uy said Converge has a “very strong” third quarter.

“Even this month, we are shocked that… individual homes need a minimum of 500 GB (gigabytes),” he noted.

“I think, other technologies can’t deliver that except for fiber at this moment… This month and even last month, we’ve encountered the biggest demand in terms of installations and applications.”

Converge saw its net income after tax for the first half of the year grow 78.6% to P2.25 billion from P1.26 billion, according to the company’s quarterly report.

“If you double that, easily we can get P6.5 to P7 billion this year,” Mr. Uy noted.

Converge recorded 32% nationwide household coverage as of June this year. Homes passed reached 8.3 million, more than double from June 2020.

The company is targeting 44% nationwide household coverage, or 15 million homes passed, by 2025.

“We have reached 400,000 areas (cities and municipalities) throughout the country,” Mr. Uy said.

“In the coming six months, we will partially open up little by little in the major cities of Visayas and Mindanao. But we will go deep in the next coming years, because you cannot do this overnight,” he noted.

“We are operating already in Cebu, and we are happy with the high [demand], which is a sign that people are really hungry for better [connectivity],” he continued.

“We already have some in Mindanao…, [especially] Davao.”

Converge had 1.4 million subscribers as of June this year. Mr. Uy expects this number to reach 1.7 million by the end of the year.

“In fact, you can see our customer base is not really big. But we are a high-growth company, with our customer base doubling every year,” Mr. Uy noted.

Converge does not expect its growth rate to normalize soon, as connectivity in the country still has so much room for improvement.

“The Philippines is still lagging behind its Asian neighbors such as Thailand and Vietnam. Thailand is close to 55% in terms of home penetration while Vietnam is close to 60%,” Mr. Uy said.

“We are not hitting 20% yet in terms of household penetration, so imagine it’s a very big market,” he added.

The company is preparing to serve remote communities through low-orbit satellites.

“We are hoping that by… 2022, we could deliver this satellite platform to [areas] not reachable by the infrastructure,” Mr. Uy said.

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