Converge ICT Solutions reported a nearly 4% increase in revenue to P34.2 billion in the first nine months of 2026, driven by its enterprise business, as the broadband provider prepares to expand into artificial intelligence (AI) services, additional data centers, and lower-cost Internet offerings amid slower economic growth.
The company said enterprise revenue rose 22% year-on-year to P6.4 billion from January to September, while residential revenue reached P27.9 billion, with its subscriber base exceeding 3.1 million as of the end of September.
Net income reached P8.1 billion, representing a net income margin of 23.6%. Earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at P19.9 billion, translating to an EBITDA margin of 58%.
During its third-quarter financial and operational results briefing, Converge executives said the company was maintaining its full-year revenue outlook despite inflationary pressures and weaker consumer spending, while exploring new revenue streams beyond traditional broadband connectivity.
“Our Enterprise business is driving growth for Converge as we see the impact of our investments in digital infrastructure needed by both large corporates and wholesale operators. Our small and medium enterprise (SME) segment is also gaining traction as we focused on targeted programs for this sector,” said Converge CEO and co-founder Dennis Anthony Uy.
The company’s enterprise and large corporate subsegment recorded revenue growth of 29.3%, while its SME business grew 15.4%.
Converge chief operations officer Benjamin Azada said the company had secured customers among international carriers, technology firms, hotels, and local government units.
“Our Enterprise business is in full swing. We’ve secured major wins this year, including major international carriers, global tech firms, major hotels, and local government units. We’re also excited for opportunities in our wholesale segment with our two new international subsea cables — Bifrost and SEA-H2X — now online,” Azada said.
The company also reported a return on invested capital of 14.5% during the nine-month period.
AI and computing services
Beyond its existing broadband operations, Converge is evaluating investments in graphics processing units (GPUs), local large language models (LLMs), and AI computing infrastructure that could support new services for residential and enterprise customers.
Uy said the company must develop products beyond Internet connectivity to sustain growth as AI changes the requirements of businesses and consumers.
“We have traditional telecom before connectivity, but beyond connectivity, we need to put all these platforms on it,” Uy said during the briefing.
Among the opportunities being studied are GPU-as-a-service, computing resources hosted in data centers, and AI platforms that could be offered alongside the company’s connectivity products.
Converge is also examining a platform capable of routing AI requests to different models based on cost and technical requirements.
Uy cited Chinese and Western AI platforms as potential options, saying less expensive models could handle some tasks while more specialized systems could be used for software development and other applications.
The approach could allow customers to access different AI capabilities without relying exclusively on a single provider.
The company is also considering two additional data centers, with Cavite, Laguna, and Batangas among the potential locations.
Chief finance officer Robert Yu said the selection would depend on power availability, flood and typhoon risks, fiber connectivity, and the location preferences of prospective customers.
He said Converge would coordinate with potential clients before proceeding with the facilities rather than build capacity without confirmed market demand.
Exploring P500 broadband package
Converge is also studying a lower-cost broadband offering priced at around P500 per month, although executives emphasized that the proposal remains at an exploratory stage.
The company currently offers prepaid fiber packages costing P700 for 30 days and options priced as low as P50 for one day.
Executives said the proposed P500 package would support efforts to bring broadband costs closer to the United Nations affordability target of approximately 2% of gross national income per capita.
Converge acknowledged that inflation has affected demand for its prepaid broadband services more heavily than its flagship FiberX subscriptions.
Azada said the company continued to see strong demand for FiberX, but customer acquisition and retention in the prepaid segment had become more challenging because lower-income households were disproportionately affected by rising prices.
Despite these pressures, the company reported more than 3.1 million residential subscribers at the end of September.
Uy also discussed alternative technologies for extending connectivity to remote communities where conventional fiber deployment would not be financially viable.
He said satellite backhaul combined with community Wi-Fi could provide a more practical solution in areas with relatively few potential subscribers.
The Converge chief also called for government participation in financing infrastructure in underserved locations.
“Free cannot be sustainability,” Uy said, referring to the long-term viability of free public Internet programs.
He said public subsidies could help private operators provide lower-cost connectivity in communities where subscriber revenues alone would not justify infrastructure investments.
Submarine cables and network expansion
Converge is also looking to capitalize on its investments in domestic and international submarine cable infrastructure.
The company said its Bifrost and SEA-H2X international submarine cable systems are now operational, creating additional opportunities in wholesale bandwidth services and connectivity for enterprise customers.
Uy said demand for international bandwidth had increased, driven partly by the computing and data requirements associated with AI.
He said the company’s international cable capacity had been oversubscribed, reflecting demand from customers requiring connectivity between the Philippines and overseas markets.
Converge has also completed a 1,800-kilometer domestic submarine cable network designed to improve inter-island connectivity and provide alternative routes during cable disruptions.
Azada said the infrastructure had expanded the company’s addressable market, including new service areas in Samar and Leyte.
The network incorporates redundant routes to reduce the risk of communities being disconnected when a submarine cable is damaged.
Meanwhile, the company is directing much of its network rollout budget toward the Visayas and Mindanao, where executives said demand remains underserved.
In Davao City, Converge acknowledged complaints about rejected service applications caused by fully utilized network access points.
Executives said the board had approved funding for additional network capacity and that deployment was underway.
Converge reported having almost 8.8 million fiber ports nationwide.
AI-powered network maintenance
Converge is also using predictive maintenance systems to identify network problems before they result in service interruptions.
Azada said the technology allows the company to detect weakening fiber signals and schedule preventive maintenance.
The company reported a 33% improvement in the number of service tickets resolved within one day and a 7% reduction in average repair time.
However, executives acknowledged that AI-based monitoring cannot prevent all outages, particularly those involving physical damage to cables and other infrastructure.
They cited road construction, utility clearing operations, and poorly organized overhead cables as recurring causes of network disruptions.
Uy called for stronger regulations covering cable management, underground infrastructure, and coordination between telecommunications providers, contractors, and local governments.
“Technology is always ahead of the regulations,” Uy said.
He emphasized that predictive systems must be supported by physical maintenance and better infrastructure policies.
AI-related job displacement
Uy also addressed the potential impact of AI adoption on employment, including concerns about job displacement in the business process outsourcing (BPO) sector.
Responding to a question about Senate Bill No. 2563, which proposes safeguards for workers affected by AI-driven automation, he said government policies and employee training would be necessary as companies adopt the technology.
“So that’s why we need to push the government to come up with a lot of policies and regulations to safeguard our people. And the workforce itself,” Uy said.
“I don’t think this AI will replace humans, but you need to adapt it or else they will lose the job. They need to adapt early,” he added.
Converge executives acknowledged that changes in the BPO industry could affect demand for enterprise connectivity services.
However, they said the company was diversifying its corporate customer base through industry-specific solutions for retail, financial services, education, and SMEs.
These services could include cybersecurity, AI applications, and other digital platforms in addition to conventional broadband connectivity.
Cybersecurity and data protection
Converge also reported obtaining ISO/IEC 27001:2022 certification for its information security management system.
During the briefing, the company said its certification initiative was intended to align its cybersecurity practices with international risk management standards rather than respond to a specific security incident.
Executives identified continuous threat monitoring, tighter access controls, and audited privacy safeguards among the measures intended to protect customer information.
The company also highlighted its cybersecurity education initiatives and services designed to help businesses maintain operations during cyberattacks.
Converge corporate compliance and data protection officer Laurice Esteban-Tuason said corporate governance requirements were becoming increasingly important as companies adopted AI and other emerging technologies.
“In the face of changing regulatory landscape and shifting business environment, including the impact of AI on how corporations manage operations, Converge continues to exemplify that upholding the highest standards of corporate governance remains a constant,” she said.
Maintaining outlook amid economic pressures
Despite weaker economic conditions, Converge said it was not revising its 2026 revenue guidance.
Yu said the company was monitoring inflation, fuel and food prices, consumer spending, and the potential effects of higher operating costs on household budgets.
He cited improvements in consumer expectations reflected in Bangko Sentral ng Pilipinas surveys as one reason for maintaining the company’s outlook.
“We’re not adjusting yet,” Yu said. “So we are cautiously optimistic.”
The company said it was also watching the impact of economic conditions on prepaid broadband demand, which is more sensitive to changes in household purchasing power.
For 2027, Converge has begun preparing its capital expenditure budget, although the proposed amount remains subject to board approval.
Yu said the company expected to provide further details by mid-December.
In the meantime, Converge is positioning its international cable systems, data center investments, and emerging AI services as potential sources of growth beyond its existing residential broadband business.
The company has yet to disclose how much of its future capital expenditure will be allocated to AI computing infrastructure and additional data centers, or when these investments are expected to generate meaningful revenue.
