FPT Update – BUY

FPT CORPORATION (FPT VN)

The moderate revenue growth in 2Q was largely driven by a slowdown in global IT services, while the telecom segment continued to underpin EBT. We maintained our EBT growth projection for the company at 15.7% YoY in 2025. Our target price for the stock is VND122,000/share by 1H2026. BUY.

Net revenue rose 9.1% YoY and EBT increased 17.7% YoY in 2Q2025, bringing FPT’s 1H2025 figures to VND32,683bn (+11.4% YoY) and VND6,166bn (+18.5% YoY), respectively. A jump of 173% YoY in financial profit (to VND968bn, thanks to interest income, exchange rate gains and dividend) along with 83% YoY in profits from affiliates (to VND243bn) propelled the EBT. The global IT and telecom services remain the company’s two pillars.

The global IT services segment, which posted 12% YoY revenue growth in 2Q (and 14.4% YoY to VND16,669bn in 1H), was weighed down by delays in IT spending and investments in AI in light of uncertainties over tariffs and the global economic landscape. Rebalancing of redundant human resources was made to be aligned with growth in signed revenue. The company found initial signs of recovery with signed revenue rising by 27% YoY July (1H: +4.7% YoY) and expect better results in 2H2025. Digital transformation services (DX) are still crucial drivers capturing 47% of the segmented revenue.

Delayed investments in AI also explain AI Factories’ underperformance against FPT’s expectations in terms of revenue and utilization rate. The factories are likely to fall short of the USD30-40m revenue target for 2025 – representing around 1–2% of the company’s revenue and EBT in our estimates – while some impacts on the overall margins, mostly due to depreciation, could be recognized.

The telecom services segment emerged as the bright spot propping up the overall results, generating an upturn of 13.4% YoY in revenue, to VND9,030bn, and 18.9% YoY in EBT, to VND2,017bn. The revenue growth was bolstered by an encouraging 15.8% YoY surge in broadband services on the back of subscriber growth and stronger pricing to new customers.

We project net revenue and EBT for FPT at VND70,953bn (+12.9% YoY) and VND12,804bn (+15.7% YoY) in 2025. Using SOTP approach, our target price for the stock by the 1H2026 is VND122,000/share.