Liberty Latin America Q3 2026 Margin Expands on OIBDA Growth

Liberty Latin America Ltd. (LILA) reported higher third-quarter Adjusted OIBDA and a wider margin despite lower revenue on a rebased basis, as cost-efficiency measures and improved performance in Costa Rica and Puerto Rico supported profitability. Year-to-date cash flow also improved substantially, although the company recorded a cash outflow in the quarter and expects most of its annual Adjusted Free Cash Flow generation to occur in the fourth quarter.

Revenue for the quarter ended September 30, 2026, was $1.117 billion, compared with $1.113 billion a year earlier. On a rebased basis, which adjusts the prior period for foreign-currency effects, revenue declined 2%.

Adjusted OIBDA increased to $454 million from $433 million and grew 3% on a rebased basis. The corresponding margin expanded by about 160 basis points to 40.6% from 39.0%. U.S. GAAP operating income was $181.1 million, down from $187.5 million.

For the first nine months of 2026, revenue rose on a reported basis to $3.303 billion from $3.283 billion but declined 1% on a rebased basis. Adjusted OIBDA increased to $1.295 billion from $1.255 billion, representing 2% rebased growth, while the margin widened to 39.2% from 38.2%.

Subscriber growth led by Panama

Liberty Latin America recorded approximately 56,000 combined postpaid mobile and broadband net additions in the third quarter, an improvement from the levels reported in both the first and second quarters. C&W Panama was the largest contributor, adding 16,000 postpaid mobile subscribers and 25,000 internet revenue-generating units.

Panama’s residential revenue grew 4% year over year, supported by fixed and mobile service revenue. The company launched its +Mas-Starlink direct-to-cell offering and implemented selective price increases across broadband, postpaid and prepaid services. Business-to-business revenue increased sequentially but was lower from a year earlier because of the timing of project revenue in the prior-year period.

Liberty Costa Rica added 14,000 postpaid mobile subscribers and 7,000 internet RGUs. Management attributed postpaid revenue growth to continued expansion of the subscriber base, supported by the Liberty-Starlink direct-to-cell launch and the company’s 5G rollout. Broadband remained stable in what the presentation described as a competitive market. Costa Rica’s revenue was $173 million, down 3% on a rebased basis, while Adjusted OIBDA rose 8% to $69 million as cost-efficiency initiatives progressed.

Liberty Puerto Rico posted its fourth consecutive quarter of postpaid additions, adding 6,000 subscribers, while internet RGUs declined by 2,000. The company said adoption of its SIM-only Liberty SIMple plans supported sequential postpaid revenue growth and that the broadband base continued to stabilize. It also implemented broadband and mobile pricing initiatives following video price actions in the second quarter. Puerto Rico revenue was unchanged on a rebased basis at $289 million, while Adjusted OIBDA increased 8% to $103 million.

Liberty Caribbean reported modest positive additions in both mobile postpaid and internet services. The business introduced its Unbeatable Internet offering and redesigned the Flow Mobile App in most markets to increase fixed-mobile convergence. Revenue declined 1% on a rebased basis to $366 million, while Adjusted OIBDA was flat at $172 million.

Network results reflect project timing

Liberty Networks generated $122 million of third-quarter revenue. Enterprise revenue rose 6% on a rebased basis, driven by IT-as-a-Service demand, while wholesale revenue fell 3% as indefeasible-right-of-use revenue accelerations declined.

The segment recorded no revenue from its El Salvador project during the quarter because of project phasing, although related direct costs were recognized. That timing contributed to a 16% rebased decline in Liberty Networks’ Adjusted OIBDA to $56 million. The company also reported continued progress on its Manta subsea cable build.

Cash flow improves year to date despite Q3 outflow

Adjusted Free Cash Flow before distributions to noncontrolling interests was negative $9.1 million in the third quarter, compared with positive $16.4 million a year earlier. After distributions, Adjusted FCF was negative $9.8 million, versus positive $16.4 million.

For the first nine months, Adjusted FCF before distributions improved by about $138 million to positive $10 million from negative $128.3 million. Adjusted FCF after distributions improved to negative $15.5 million from negative $157.4 million. The 2026 result included $32 million of Adjusted FCF losses at Liberty Puerto Rico, compared with $123 million in the prior-year period.

Property and equipment additions increased to $170 million, or 15% of revenue, from $149 million, or 13%, in the third quarter. Year-to-date additions were $459 million, compared with $420 million.

Management said the bulk of annual Adjusted FCF is expected to be generated in the fourth quarter, consistent with the company’s usual seasonal pattern. Its priorities for the period include commercial activity, the traditional fourth-quarter weighting of B2B results and continued execution of cost-efficiency programs.

Capital returns and balance sheet

Liberty Latin America had repurchased $152 million of shares in 2026 through October 31, including $91 million during the third quarter and $33 million in October. The company said it accelerated common-stock repurchases after making a preferred distribution.

At September 30, the company reported $8.5 billion of total debt, $579 million of cash and cash equivalents including restricted cash related to debt, and $900 million of unused revolving-credit-facility capacity. Its non-GAAP consolidated net leverage ratio was 4.5 times.

The company’s outlook remains subject to the execution of its efficiency and commercial initiatives, competition, project timing, currency and interest-rate movements, and its ability to achieve operating and cash-flow targets. Natural disasters and the pace of recovery in Puerto Rico and Jamaica were also among the uncertainties identified in the presentation.