Globe Telecom’s Leadership Transition: Can New CEO Carl Cruz Steer Through Financial Headwinds?
The Philippine telecom landscape just got its own version of a high-stakes corporate thriller. Globe Telecom Inc., the archipelago’s telecom heavyweight, is swapping its veteran CEO Ernest Cu—the architect behind its 15-year growth spurt—for Carl Raymond R. Cruz, a fintech-savvy strategist with a résumé spanning Lagos to Mumbai. The timing? Far from ideal. Globe’s Q1 2025 earnings report reads like a detective’s case file: core net income down 22%, revenue growth crawling slower than Manila traffic, and interest expenses biting chunks out of profits. But Cruz isn’t here to mourn spilled pesos. Backed by parent conglomerate Ayala Group, he’s betting on 5G rollouts, GCash’s billion-dollar IPO, and a customer obsession to turn the tide. The question isn’t just about succession—it’s whether Cruz can dodge the fiscal bullets long enough to keep Globe’s throne in the telecom kingdom.
The Inheritance: A Mixed Bag of Triumphs and Troubles
Ernest Cu leaves Cruz a legacy both glittering and tarnished. Under Cu, Globe became synonymous with digital disruption—launching GCash (now handling 90% of Philippine e-wallet transactions) and blanketing islands with 4G towers. But 2025’s rocky start exposes cracks: interest rate hikes ballooned debt servicing costs, while prepaid SIM registration laws throttled subscriber growth. Analysts whisper about Globe’s “middle-child syndrome”—sandwiched between PLDT’s fiber dominance and DITO Telecommunity’s cutthroat pricing.
Cruz’s playbook? Double down on what works. GCash, contributing 5% to Globe’s pre-tax income, is his ace. Its impending IPO (targeting $1–1.5 billion) could inject liquidity to pare down debt. Meanwhile, Mynt (GCash’s parent) is eyeing Vietnam and Indonesia—a potential hedge against domestic saturation. “Fintech isn’t just a side hustle; it’s Globe’s lifeboat,” says a Manila-based analyst.
5G or Bust: The Infrastructure Gambit
If fintech is Cruz’s shield, 5G is his sword. Globe has poured $1.3 billion into 5G infrastructure since 2023, but coverage remains spotty outside Metro Manila. Critics argue the ROI is nebulous—especially when 80% of Filipinos still use budget 4G phones. Cruz counters with enterprise solutions: smart factories, telehealth, and even drone-powered agriculture partnerships. “5G isn’t about faster TikTok streams,” he quipped at a recent investor call. “It’s about rewriting how businesses operate.”
The catch? Capital intensity. Globe’s net debt-to-EBITDA ratio hovers at 2.4x—a red flag for rating agencies. Cruz must balance infrastructure spend with austerity measures, like renegotiating vendor contracts and sharing tower assets with rivals. One insider revealed plans to monetize idle fiber optics by leasing them to hyperscalers like AWS. “We’re turning liabilities into revenue streams,” the source said.
Customer Centricity: From Churn to Charm
Globe’s Achilles’ heel? Customer satisfaction scores trailing PLDT by 12 points. Cruz’s remedy is a “Globe 3.0” overhaul—part tech upgrade, part cultural revolution. Initiatives include AI-driven complaint resolution (slashing call-center wait times by 40%) and bundling GCash perks with postpaid plans. A pilot “digital barangay” program offers free WiFi in exchange for GCash transactions—a Trojan horse for financial inclusion.
But Cruz’s boldest move might be structural. Insiders hint at splitting Globe into two units: one for legacy telecom, another for digital ventures. The goal? To let fintech and 5G divisions innovate without being weighed down by traditional telecom’s low margins. “It’s like letting a startup loose inside a Fortune 500 company,” remarked a board member.
The Verdict: A High-Wire Act in Monsoon Season
Carl Cruz isn’t just stepping into Ernest Cu’s shoes—he’s stepping onto a tightrope. Globe’s challenges are legion: debt drag, 5G’s uncertain payoff, and a price war with DITO. Yet Cruz’s cross-border experience (he turned around Airtel Nigeria’s operations) suggests he thrives in chaos.
The Ayala Group’s bet hinges on Cruz’s agility. If GCash’s IPO flies and 5B gains traction with enterprises, Globe could pivot from defensive to dominant. But missteps—like overleveraging or botching the digital divide—might leave Cruz as another cautionary tale in telecom’s graveyard. One thing’s certain: In the Philippines’ cutthroat connectivity race, Cruz isn’t just changing the guard. He’s rewriting the rules. Case closed—for now.
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