Service revenue declined 5.4% y-o-y to $555.8 million, about 6% below consensus expectations of $592.2 million. Mobile revenue fell 10.1% y-o-y, reflecting weaker high-value roaming, IDD, and value-added services, while the broadband and entertainment segments also declined. Service ebitda dropped 24.7% y-o-y to $85.8 million, with margin compressing to 15.4% from 19.4% a year earlier.
Blended mobile ARPU held steady at $22 in 4QFY2025, even though fixed broadband ARPU declined to $34 from $36 a year earlier.
DBS Group Research’s Sachin Mittal highlights ongoing pressure in the mobile market, with value players offering plans in the $10–$12 range and senior discounts as low as $5, alongside continued promotional activity. While StarHub has signalled a shift toward improving customer lifetime value rather than pursuing volume growth, he suggests earnings visibility remains challenged in the near term.
FY2026 outlook disappoints
See also: IFAST share price dips despite strong earnings 4QFY2025 announcement; DBS maintains ‘buy’ at $12
More concerning for Mittal is management’s FY2026 guidance. StarHub expects ebitda to come in at 75% to 80% of FY2025 levels, well below market expectations of about 9% growth in FY2026.
Management said it will prioritise profitable consumer growth over aggressive subscriber acquisition, while retaining flexibility amid intense competition. Capex is guided at 13% to 15% of revenue to support 5G rollout and IT investments. The telco reiterates its commitment to a stable dividend of at least 6 cents per share annually.
Given the weaker earnings trajectory, Mittal says his target price and recommendation for StarHub are currently under review.
See also: DBS, BofA and UOB retain ‘buy’ on Singtel as 3QFY2026 tops expectations
Morningstar’s Baker has also turned more cautious. He cut his StarHub forecasts by 22% for 2026 and 11% for 2027, citing weaker operating trends and sustained competitive intensity.
“Our fair value estimate for no-moat-rated StarHub reduces to $1 from $1.20 previously. The stock looks overvalued at these levels,” he writes in a Feb 13 note.
His forecasts assume StarHub can lift operating profit at a five-year compound annual growth rate (CAGR) of 5%, largely driven by continued cost reductions. “Any significant reduction in mobile competition would provide upside to these forecasts and our fair value,” he adds.
As at 3.44 pm, shares in StarHub are trading at 1 cent lower, or 0.88% down, at $1.13.
