Jakarta, Indonesia – In a highly anticipated earnings call on Tuesday, August 5th, Telkom Indonesia (TLKM) management provided critical insights into their second-quarter 2025 performance and forward-looking strategy. The telecommunications giant, facing a challenging market, outlined significant revisions to its full-year guidance and unveiled an ambitious roadmap for its fiber infrastructure business, signaling a pivotal moment for the company’s trajectory.

Revised 2025 Guidance Reflects Shifting Tides

Following a softer performance in the first half of 2025, Telkom Indonesia has recalibrated its financial expectations for the year. Management announced a revision to its 2025 revenue growth guidance, moving from a low-single digit projection to a flat growth forecast. This prudent adjustment reflects current market dynamics and a more realistic outlook for the top line.

The ripple effect of this revenue revision extends to profitability targets. The initial EBITDA margin target, set at 50-52%, has been narrowed to a firm 50%, a slight uptick from the 49.5% achieved in 1H25. To hit this revised target, Telkom must generate approximately IDR 77 trillion in revenue during 2H25. This represents a robust 5.4% increase from the IDR 73 trillion recorded in 1H25 and a 3% climb over 2H24’s IDR 74.7 trillion. Analysts largely deem this revised target achievable, underpinned by several anticipated positive catalysts for TLKM’s future performance.

Mobile ARPU Stabilizes: Strategic Reforms Bear Fruit

A significant highlight from the earnings call was Telkom’s confidence in the mobile segment. Management expressed optimism that the decline in Average Revenue Per User (ARPU) has bottomed out at IDR 41.2 thousand. This projected stabilization and potential rebound are attributed to several strategic initiatives:

• Product Rationalization: The introduction of a new starter pack at IDR 35,000 for 3GB of data, a deliberate move up from the previous IDR 24,000 for 6GB. Concurrently, the company is phasing out legacy programs like Telkomsel Lite and certain Telkomsel prepaid offerings.
• SKU Simplification: A massive consolidation effort has seen the number of product SKUs dramatically reduced from 6,000 to a more manageable 400. This streamlines offerings and enhances clarity for consumers.
• Inventory Clearance: Management anticipates the remaining inventory of aggressively priced starter packs, a hangover from intense competition between 3Q24 and 1Q25, will be fully depleted by the end of August 2025.

Looking ahead, Telkom anticipates an uptick in consumer purchasing power. This economic tailwind, coupled with the strategic adjustments, is expected to drive increased data consumption, as indicated by payload data, even as pricing gradually improves. This signals a healthier competitive environment and a stronger revenue per user outlook.

Unlocking Value: The FiberCo Spin-Off and Future of Infrastructure

Perhaps the most forward-looking announcement centered on Telkom’s ambitious fiber strategy. Following the establishment of Infranexia (PT Telkom Infrastruktur Indonesia) as a dedicated fiber infrastructure entity, the company plans a first-stage spin-off in 4Q25. This move aims to transfer over 50% of Telkom’s total selected fiber assets and business to Infranexia.

Crucially, management is exploring opportunities to open up currently internal-only fiber assets to external parties, significantly boosting utilization and creating new revenue streams. However, Telkom is carefully evaluating the potential impact of such moves on its popular fixed broadband service, IndiHome. While this strategy promises enhanced asset monetization and potentially a more efficient infrastructure ecosystem, it also portends an increase in competition across the fixed broadband segment, affecting both service providers and infrastructure players alike. Telkom’s proactive approach here could redefine the landscape, turning its extensive fiber network into a powerful engine for future growth and market leadership.