Jakarta, INTI - PT Telkom Indonesia (Persero) Tbk (TLKM) recorded significant pressure on its net profit performance in the fourth quarter of 2025 due to accelerated depreciation and amortization (D&A) expenses as well as ERP system implementation costs.
Based on the company’s financial report, Telkom’s net profit during the period fell sharply to Rp2 trillion, declining 57.8% quarter-on-quarter and 57.1% year-on-year.
The decline was primarily driven by changes in the classification of asset useful lives, particularly drop cables whose depreciation period was shortened to five years, along with approximately Rp937 billion in second-phase ERP implementation costs.
On a full-year basis, Telkom’s net profit throughout 2025 reached Rp17.8 trillion, down 20.5% compared to the previous year.
Analyst at Mirae Asset Sekuritas Indonesia, Daniel Widjaja, stated that the results were below both Mirae Asset’s and market consensus expectations, reaching only 79.5% and 82.9% of projections respectively.
Mobile Segment Continues to Support Revenue Growth
Despite the earnings pressure, Telkom’s revenue in the fourth quarter of 2025 still reached Rp37.1 trillion, rising 1.4% quarter-on-quarter although declining 1.7% year-on-year.
The cellular segment remained the main growth driver, with revenue increasing 11.6% year-on-year, supported by higher average revenue per user (ARPU), which rose to Rp45,000. By the end of the period, exit ARPU reached Rp47,000.
In addition, data yield increased to Rp3.8 per MB, representing 6% annual growth. However, the number of mobile subscribers declined to 156 million, down 2.1%, due to higher churn among lower-value customers amid increased starter card prices.
Data consumption growth also remained relatively limited at 34.7 GB per subscriber, up only 1% year-on-year.
Daniel noted that pressure from the company’s “kitchen sinking” policy is expected to continue through 2028. The strategy involves accelerated depreciation of non-network assets, particularly drop cables and other network-related assets.
The accounting policy has been implemented retrospectively through the restatement of the company’s 2023 and 2024 financial statements.
TLKM 30 Strategy Targets Long-Term Digital Transformation
Nevertheless, Mirae Asset believes the accelerated depreciation policy will not affect the company’s cash flow or dividend distribution. The accelerated depreciation value is estimated to reach Rp2.3 trillion by 2028.
Meanwhile, the spin-off process for Telkom’s fiber business is projected to be completed in the third quarter of 2026.
Mirae Asset also revised downward its EBITDA and net profit forecasts for Telkom in 2026 and 2027. EBITDA projections were reduced by 2.8% and 0.6%, while net profit attributable to parent entity owners (NPATMI) was cut by 14.7% and 17.9%, respectively.
The adjustments were made by considering the impact of accelerated depreciation and the potential continuation of ERP programs in 2026, which are estimated to cost around Rp1 trillion.
Despite these pressures, Mirae Asset maintained its dividend assumptions while awaiting the outcome of Telkom’s Extraordinary General Meeting of Shareholders scheduled for June 8, 2026. The target price for Telkom shares was also lowered to Rp3,200 per share, based on a 2026 EV/EBITDA valuation of 4.4 times.
Amid these performance challenges, Telkom has started implementing its TLKM 30 transformation strategy. The program is designed as the company’s strategic response to strengthen its position as Indonesia’s leading digital telecommunications company and as an enabler of the national digital ecosystem.
Through TLKM 30, Telkom aims to carry out a comprehensive transformation covering business models, corporate governance, and workplace culture. The strategy is focused on creating sustainable value and maintaining the company’s relevance amid accelerating digital industry disruption.
Conclusion
PT Telkom Indonesia (Persero) Tbk is facing short-term profitability pressure driven by accelerated depreciation policies and ERP implementation costs. However, through the TLKM 30 transformation strategy, the company aims to strengthen its long-term position as a leading digital telecommunications and ecosystem enabler in Indonesia by focusing on business transformation, operational sustainability, and adaptation to the rapidly evolving digital industry.
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