Millicom Q2 2026 Earnings: Equity Free Cash Flow Hits a Record $327 Million

Millicom (NASDAQ: TIGO) reported Q2 2026 revenue of $2.179 billion, up 59.4% year over year, while net profit attributable to company owners fell 83.9% to $109 million from $676 million. Adjusted EBITDA exceeded $1 billion for the first time, and equity free cash flow reached a quarterly record of $327 million, prompting the company to raise its full-year cash flow guidance.

Core Earnings Data

The large gap between reported revenue growth of 59.4% and organic growth of 4.3% reflects the effect of Millicom’s expanded portfolio. Service revenue increased 60.1% as reported and 5.4% organically, while adjusted EBITDA grew 58.0% as reported and 9.1% organically.

Operating profit increased, but it grew more slowly than revenue. Attributable net profit moved sharply lower despite the operating improvement, and the supplied release did not provide a bridge explaining that divergence.

Service revenue, adjusted EBITDA, capital expenditure, operating cash flow, and equity free cash flow are company-defined non-IFRS measures. Equity free cash flow excludes disposal proceeds.

Business and Regional Performance

Management said the operating model is producing improvements across recently acquired businesses. Ecuador and Uruguay recorded better margins and equity free cash flow and are now performing broadly in line with Millicom’s average.

In Colombia and Chile, integration and turnaround efforts remained in progress. Management reported early improvements in profitability and cash generation, although the release did not provide regional financial figures that would quantify their contribution to consolidated results.

Profitability, Cash Flow, and Balance Sheet

Operating profit rose 30.4%, well below the 59.4% increase in revenue. Based on the reported figures, operating margin declined to approximately 21.2% from 25.9% a year earlier. Adjusted EBITDA margin was more stable at approximately 46.3%, compared with 46.7% in Q2 2025.

On an organic basis, adjusted EBITDA growth of 9.1% outpaced both revenue growth of 4.3% and service revenue growth of 5.4%. That indicates stronger underlying EBITDA development even though the reported margin was affected by the expanded portfolio.

Cash generation was a central feature of the quarter. Equity free cash flow increased 50.1% to a record $327 million despite capital expenditure rising 51.2% to $234 million. Leverage declined to 2.73x, including the acquisitions in Colombia, Ecuador, and Uruguay, but remained above the company’s revised year-end target.

Millicom also expanded its shareholder distributions. In addition to the $3.00-per-share dividend declared in May, the board approved an interim dividend of $1.50 per share on August 5. The additional dividend will be paid in two installments of $0.75 per share on January 15 and April 15, 2027.

After quarter-end, the Bolivia operation entered local bank loans totaling approximately $44 million. Colombia’s Coltel separately repaid approximately $102 million of credit facilities in July.

Operating Gains and Record Cash Flow Contrast With Lower Net Profit

The quarter presents a clear difference between operating and bottom-line performance. Revenue, operating profit, adjusted EBITDA, and equity free cash flow all increased, while attributable net profit declined from $676 million to $109 million. Because the release did not explain the factors below operating profit, the supplied information is insufficient to determine how financing, taxes, or other items contributed to the decline.

2026 Guidance

Millicom raised its equity free cash flow outlook after its first-half performance, integration progress, and improved visibility across the portfolio. It also lowered its leverage target, signaling an expectation of further balance-sheet improvement during the second half. Both targets include restructuring costs associated with acquired businesses.

Risks Investors Need to Watch

• Reliance on portfolio expansion: Reported revenue growth of 59.4% substantially exceeded organic growth of 4.3%, making continued integration and underlying organic growth important to sustaining performance.
• Net profit divergence: Attributable net profit fell 83.9% even as operating profit increased. The absence of a detailed bridge in the release leaves the cause of this divergence unresolved.
• Deleveraging execution: Leverage stood at 2.73x, above the revised target of below 2.5x. Millicom must continue reducing leverage while funding restructuring, capital expenditure, and declared dividends.
• Early-stage turnarounds: Improvements in Colombia and Chile were described as early, meaning further execution is required before those operations reach a steadier state.

Summary

Millicom’s Q2 2026 results were shaped by its expanded Latin American portfolio, with acquisitions driving much of the reported growth while organic revenue and EBITDA also advanced. Record equity free cash flow supported higher full-year guidance and additional dividends, but the decline in attributable net profit, lower operating margin, and the remaining work needed to reach the leverage target are the main issues to monitor.