Business Context and Reporting Period
Company: Millicom International Cellular S.A. (Tigo)
Filing Type: Form 6-K (Unaudited Interim Condensed Consolidated Financial Statements and Earnings Release)
Reporting Period: Three months ended March 31, 2026 (Q1 2026)
Filing Date: May 12, 2026
Millicom is a leading provider of fixed and mobile telecommunications services in Latin America. The Q1 2026 results reflect significant strategic expansion, including the full consolidation of Colombia Telecomunicaciones S.A. E.S.P. ("Coltel") following the acquisition of a 67.5% stake from Telefónica on February 6, 2026, and the acquisition of the remaining 50% stake in Tigo UNE (Colombia) from EPM in January 2026. The company also consolidated operations in Uruguay and Ecuador acquired in late 2025.
Key Financial Metrics
| Metric ($ millions) | Q1 2026 | Q1 2025 | Change |
|---|---|---|---|
| Revenue | 1,985 | 1,368 | +45.1% |
| Service Revenue | 1,857 | 1,279 | +45.2% |
| Operating Profit | 416 | 421 | -1.2% |
| Adjusted EBITDA | 857 | 633 | +35.5% |
| Net Profit (Attributable to Owners) | 109 | 193 | -43.4% |
| Equity Free Cash Flow (EFCF) | 225 | 135 | +66.5% |
| Gross Debt | 8,624 | 5,772 | +49.4% |
| Net Debt | 7,609 | 5,275 | +44.2% |
| Leverage (Net Debt/EBITDA) | 2.76x | 2.47x | N/A |
Key Operational Metrics:
- Mobile Customers: 57.3 million (+37.8% YoY)
- Mobile ARPU: $6.7 (+13.4% YoY)
- Capital Expenditures (Capex): $193 million (+46.0% YoY)
Material Changes vs. Prior Period
- Revenue Growth: Reported revenue increased 45.1% YoY, driven primarily by the consolidation of Coltel, Ecuador, and Uruguay, as well as favorable foreign exchange movements (Colombian Peso, Paraguayan Guarani, Bolivian Boliviano). Organic service revenue growth was 4.9%.
- Profitability: Operating profit remained flat (-1.2%) despite revenue growth, impacted by $65 million in severance costs related to Coltel integration and increased depreciation/amortization from new assets. Adjusted EBITDA grew 35.5% to $857 million.
- Net Profit Decline: Net profit attributable to owners dropped 43.4% to $109 million. This was due to higher financial expenses ($248 million vs. $164 million), restructuring costs, and the absence of one-time gains from the Lati tower sale present in Q1 2025.
- Debt and Leverage: Gross debt increased by $1.74 billion to $8.62 billion, primarily due to the consolidation of Coltel's debt ($1.48 billion). Leverage rose to 2.76x from 2.17x at year-end 2025.
- Cash Flow: Equity Free Cash Flow (EFCF) improved significantly to $225 million, up 66.5% YoY when excluding the prior year's infrastructure sale proceeds.
Guidance, Outlook, and Risks
2026 Financial Targets:
- Equity Free Cash Flow (EFCF): At least $900 million.
- Year-end Leverage: Around 2.5x.
- These targets include restructuring costs associated with acquired businesses.
Management Commentary:
CEO Marcelo Benitez highlighted strong operational execution and strategic progress. Key initiatives include strengthening the position in Colombia, applying the Millicom playbook in Chile (acquired via joint venture with NJJ), and driving prepaid-to-postpaid migration to support ARPU growth. The company is focused on disciplined cash flow management and expanding convergence.
Risks and Contingencies:
- Integration Risks: Ongoing integration of Coltel, Uruguay, and Ecuador operations, including purchase price allocation uncertainties.
- Foreign Exchange: Significant exposure to local currency fluctuations in Latin American markets.
- Regulatory and Legal: Total claims against the group are $188 million (with $47 million provisioned). Tax risk exposure is estimated at $401 million (with $33 million provisioned).
- Market Conditions: Risks related to global economic activity, inflation, and competitive pricing pressures.
Investor Verification Checklist
- Acquisition Accounting: Verify the provisional fair value allocations for Coltel, Uruguay, and Ecuador, noting that measurement periods are open and adjustments may occur retrospectively.
- Restructuring Costs: Confirm the magnitude and timing of severance costs ($65 million in Q1 for Coltel; additional $26 million in Colombia and $21 million in Chile in April 2026) and their impact on future margins.
- Debt Maturity Profile: Review the debt maturity schedule, noting that 61% of gross debt is in local currency and the average maturity is 3.6 years.
- Organic Growth Sustainability: Assess the 4.9% organic service revenue growth and 9.6% organic Adjusted EBITDA growth to ensure they are not solely FX-driven.
- Subsequent Events: Note the completion of the La Nacion stake acquisition in Coltel (April 2026) and the sale of Tigo Sports content to FOX (April 2026).