América Móvil Disconnects 1.7 Million Users in Mexico in 2Q20

Due to mobility restrictions and lack of income due to the crisis brought by COVID-19, América Móvil, owner of Telcel, disconnected 5 million mobile phone lines in 2Q20, of which 4.6 million were prepaid customers. Disconnected customers include 1.7 million in Mexico, 1 million in Peru, 1 million in Central America, and 476,000 in Ecuador. As a result, the multinational company of the Mexican businessman Carlos Slim, suffered a slowdown in revenues from mobile phone services in both the prepaid and postpaid segments.

“Lockdown measures primarily caused a slowdown in mobile revenue growth, which was similar in the prepaid and postpaid segments. The impact on prepaid revenues was proportionally stronger in those countries and regions where prepaid services are more frequent, including Mexico and the Dominican Republic,” said the company in its quarterly report.

However, as lockdown measures began to ease, there was an improvement trend in all operations, the company explained. “During 2Q20, nearly our entire region of operations was under lockdown to control the spread of COVID-19, which disrupted business activities due to the closing of stores and customer service centers, as well as mobility restrictions forour clients”, added the telecommunications company.

Still, it was not all bad news for the company. Despite the contraction in various segments, the company’s net profit grew 39.6 percent to MX$20.1 billion (US$899 million) compared to the same period a year earlier. Consolidated revenues in the 2Q20 totaled MX$251.6 billion (US$11.3 billion), 0.6 percent more than in the same quarter of the previous year, despite the fact that equipment revenues fell 27.2 percent.

América Móvil’s EBITDA in 2Q20 was MX$82.6 billion (US$3.7 billion) and increased 5.9 percent compared to the previous year. Meanwhile, service revenues increased 6.5 percent due to the depreciation of the peso (15 percent) against the dollar and the euro overthis year.