Operating Segment Information

12 Months Ended

Dec. 31, 2023

Disclosure of operating segments [abstract]

Operating segments are components of the PLDT Group that engage in business activities from which they may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of PLDT Group). The operating results of these operating segments are regularly reviewed by the Management Committee to make decisions about how resources are to be allocated to each of the segments and to assess their performances, and for which discrete financial information is available.

For management purposes, we are organized into business units based on our products and services. We have three reportable operating segments as follows:

•

Wireless – mobile telecommunications services provided by Smart and DMPI, our mobile service providers; SBI and PDSI, our wireless broadband service providers; and certain subsidiaries of PLDT Global;

•

Fixed Line – fixed line telecommunications services primarily provided by PLDT. We also provide fixed line services through PLDT’s subsidiaries, namely, ClarkTel, BCC and PLDT Global and certain subsidiaries; data center, cloud, cyber security services, managed information technology services and resellership through ePLDT and its subsidiaries; distribution of Filipino channels and content through PGNL and its subsidiaries; and software development and IT solutions provided by Multisys; and

•

Others – PCEV, PGIH, PLDT Digital and its subsidiaries, our investment companies.

See Note 2 – Summary of Material Accounting Policies for further discussion.

Segment revenues, segment expenses and segment results include transfers between business segments. These transfers are eliminated in full upon consolidation.

The amounts of segment assets and liabilities and segment profit or loss are based on measurement principles that are similar to those used in measuring the assets and liabilities and profit or loss in our consolidated financial statements, which is in accordance with IFRS. The segment revenues, net income, and other segment information of our reportable operating segments for the years ended December 31, 2023, 2022 and 2021, and as at December 31, 2023 and 2022 are as follows:


	Wireless		Fixed Line			Others			Inter- segment Transactions			Consolidated
	(in million pesos, except for EBITDA margin)
December 31, 2023
Revenues
External customers		103,718		107,235			—			—			210,953
Service revenues		94,994		106,838			—			—			201,832
Non-service revenues		8,724		397			—			—			9,121
Inter-segment transactions		683		13,499			—			(14,182	)		—
Service revenues		683		13,498			—			(14,181	)		—
Non-service revenues		—		1			—			(1	)		—
Total revenues		104,401		120,734			—			(14,182	)		210,953
Results
Depreciation and amortization		31,498		36,855			—			(9,912	)		58,441
Asset impairment		648		3,784			—			—			4,432
Interest income		720		324			7			(35	)		1,016
Equity share in net losses of associates and joint ventures		—		(595	)		(2,211	)		—			(2,806	)
Financing costs – net		9,034		6,824			—			(2,103	)		13,755
Provision for income tax		5,537		4,015			1			59			9,612
Net income (loss) / Segment profit (loss)		17,522		26,473			(2,270	)		(14,901	)		26,824
Continuing operations		17,522		26,514			(2,270	)		(14,901	)		26,865
Discontinued operations (Notes 2 and 8)		—		(41	)		—			—			(41	)
Assets and liabilities
Operating assets		291,140		260,220			13,415			(23,736	)		541,039
Investments in associates and joint ventures		41		42,709			7,558			—			50,308
Deferred income tax assets – net		5,356		11,270			53			1,493			18,172
Total assets		296,537		314,199			21,026			(22,243	)		609,519
Operating liabilities		233,237		279,660			1,883			(15,812	)		498,968
Deferred income tax liabilities		—		165			—			—			165
Total liabilities		233,237		279,825			1,883			(15,812	)		499,133
Other segment information
Capital expenditures, including capitalized interest (Note 9)(1)		36,797		48,286			—			—			85,083

(1) Net of additions subject to sale and leaseback from tower companies.


	Wireless		Fixed Line			Others			Inter- segment Transactions			Consolidated
	(in million pesos, except for EBITDA margin)
December 31, 2022
Revenues
External customers		103,482		100,880			—			—			204,362
Service revenues		95,060		100,284			—			—			195,344
Non-service revenues		8,422		596			—			—			9,018
Inter-segment transactions		792		26,930			—			(27,722	)		—
Service revenues		792		26,930			—			(27,722	)		—
Non-service revenues		—		—			—			—			—
Total revenues		104,274		127,810			—			(27,722	)		204,362

Results
Depreciation and amortization		52,660		55,707			—			(9,736	)		98,631
Asset impairment		1,173		4,870			1			—			6,044
Interest income		451		202			14			(14	)		653
Equity share in net losses of associates and joint ventures		—		(253	)		(3,051	)		—			(3,304	)
Financing costs – net		8,349		6,100			—			(2,690	)		11,759
Provision for (benefit from) income tax		3,793		(1,102	)		(134	)		140			2,697
Net income (loss) / Segment profit (loss)		15,104		16,166			(2,669	)		(17,866	)		10,735
Continuing operations		15,104		16,766			(2,669	)		(17,866	)		11,335
Discontinued operations (Notes 2 and 8)		—		(600	)		—			—			(600	)

Assets and liabilities
Operating assets		310,549		257,976			10,768			(24,313	)		554,980
Investments in associates and joint ventures		40		43,304			8,202			—			51,546
Deferred income tax assets – net		6,871		9,280			53			1,432			17,636
Total assets		317,460		310,560			19,023			(22,881	)		624,162
Operating liabilities		246,170		272,489			1,630			(10,292	)		509,997
Deferred income tax liabilities		—		204			—			—			204
Total liabilities		246,170		272,693			1,630			(10,292	)		510,201

Other segment information
Capital expenditures, including capitalized interest (Note 9)(1)		46,636		50,174			—			—			96,810

(1) Net of additions subject to sale and leaseback from tower companies.


	Wireless			Fixed Line			Others			Inter- segment Transactions			Consolidated
	(in million pesos, except for EBITDA margin)

December 31, 2021
Revenues
External customers		105,492			86,694			—			—			192,186
Service revenues		98,512			86,168			—			—			184,680
Non-service revenues		6,980			526			—			—			7,506
Inter-segment transactions		1,127			29,298			—			(30,425	)		—
Service revenues		1,127			29,290			—			(30,417	)		—
Non-service revenues		—			8			—			(8	)		—
Total revenues		106,619			115,992			—			(30,425	)		192,186

Results
Depreciation and amortization		40,459			22,042			—			(10,429	)		52,072
Asset impairment		1,241			3,700			1			—			4,942
Interest income		355			274			26			—			655
Equity share in net gains (losses) of associates and joint ventures		-			103			(1,204	)		—			(1,101	)
Financing costs – net		(7,551	)		(6,017	)		-			3,166			(10,402	)
Provision for (benefit from) income tax		3,366			4,084			(270	)		279			7,459
Net income (loss) / Segment profit (loss)		9,434			26,146			384			(9,288	)		26,676
Continuing operations		9,434			26,267			384			(9,288	)		26,797
Discontinued operations (Notes 2 and 8)		—			(121	)		—			—			(121	)

Assets and liabilities
Operating assets		299,513			285,083			7,351			(32,368	)		559,579
Investments in associates and joint ventures		39			43,519			9,806			—			53,364
Deferred income tax assets – net		4,695			8,433			(81	)		338			13,385
Total assets		304,247			337,035			17,076			(32,030	)		626,328
Operating liabilities		213,219			293,162			1,023			(8,710	)		498,694
Deferred income tax liabilities		—			169			—			—			169
Total liabilities		213,219			293,331			1,023			(8,710	)		498,863

Other segment information
Capital expenditures, including capitalized interest (Note 9)		36,898			52,085			—			—			88,983

The following table presents our revenues from external customers by category of products and services for the years ended December 31, 2023, 2022 and 2021:


	2023			2022		2021
			(in million pesos)
Wireless services
Service revenues:
Mobile		93,365			93,029		95,619
Home broadband		1,629			2,028		2,889
MVNO and others		—			3		4
		94,994			95,060		98,512
Non-service revenues:
Sale of mobile handsets and broadband data modems		8,724			8,422		6,980
Total wireless revenues		103,718			103,482		105,492
Fixed line services
Service revenues:
Voice		25,160			22,249		20,222
Data		81,509			77,889		65,796
Miscellaneous		169			146		150
		106,838			100,284		86,168
Non-service revenues:
Sale of computers, phone units and SIM cards		395			495		454
Point-product-sales		2			101		72
		397			596		526
Total fixed line revenues		107,235			100,880		86,694
Total revenues		210,953			204,362		192,186

Disclosure of the geographical distribution of our revenues from external customers and the geographical location of our total assets are not provided since majority of our consolidated revenues are derived from our operations within the Philippines.

There is no revenue transaction with a single external customer that accounted for 10% or more of our consolidated revenues from external customers for the years ended December 31, 2023, 2022 and 2021.