FPT Flash note – OUTPERFORM

FPT CORPORATION (FPT VN)

The company continued to report vivid EBT growth of 18.5% YoY, to VND6,166bn, notwithstanding slower net revenue rise of 11.4% YoY in 1H2025 (including a 9% upturn in 2Q, lower than our expectation). We maintain our projection for EBT growth at 16%, reaching VND12,840bn, in spite of a downward revision of 2.7% for net revenue in 2025.  Moving target price to 1H2026 at VND125,900/share, equivalent to a 15.1% total return. Rating OUTPERFORM. 

FPT announced net revenue at VND16,625bn (+9.1% YoY) and EBT at VND3,141bn (+17.7% YoY) in 2Q2025. On a cumulative basis, net revenue climbed by 11.4% YoY, to VND32,683bn, and EBT rose by 18.5% YoY, to VND6,166bn, in 1H2025.

The dim revenue growth in 2Q was largely driven by a slowdown of 12% YoY in the Global IT services segment as a result of weak performance in the US (+8.6% YoY) and APAC (-11% YoY) markets, which together accounted for 50% of the segmented revenue. Details about these markets would be updated later. Meanwhile, other markets including Japan – the largest contributor – and Europe each continued to perform well with healthy growth of 26% YoY in 2Q. Cumulative 1H2025, revenue form the Global IT services segment grew by 14.4% YoY, to VND16,669bn.

Contributing to buttress the company’s 1H2025 results was the telecom services segment – FPT’s second largest pillar – as it generated a revenue upturn of 13.4% YoY, to VND9,030bn, primarily on the back of an encouraging 15.8% in broadband services.

The company’s EBT was underpinned by growth of 173% YoY in financial profit (to VND968bn, thanks to interest income, exchange rate gain and dividend) and 83% YoY in profits from affiliates (to VND243bn).

SCIC’s ownership (50.2%) in FPT Telecom (Upcom: FOX; a subsidiary of FPT despite a 45.7% stake) was already transferred to Ministry of Public Security (MoPS). However, we have yet found any alteration in FPT’s power to govern FOX’s financial and operating policies, which means no change in consolidation of FOX’s financial statements into FPT as well as FPT’s revenue and EAT structure so far. Regarding the case that MoPS holds the power to govern FOX’s financial and operating policies, FOX is no longer listed as a subsidiary but an affiliate of FPT. Accordingly, FPT’s revenue will record the absence of FOX contribution; however, there is no impact on FPT’s NPATMI because FPT’s current NPATMI also excludes minority interest at FOX.