Welcome to earningsHub PRO, the premium edition for TMT professionals seeking clear and independent analysis of the financial moves shaping the digital economy.
In this issue:
The region's biggest borrower runs one of its safest balance sheets.
Leverage, not size, decides who can return capital and who cannot.
Grupo Televisa lost investment grade at two agencies in twelve months.
Leverage License separates the operators that can act from those that cannot.
In case you missed it:
América Móvil $AMX ( ▲ 0.43% ) carries roughly $24.3 billion in net debt, about three times the next-largest borrower in the Latin American telco landscape.
The figure invites a conclusion about risk that the balance sheet does not support. At 1.41x net debt to EBITDA, América Móvil runs one of the most conservative books in the region, and management is steering toward 1.3x before it accelerates anything. The operator with the largest debt load is not the operator under the most strain.
Liberty Latin America $LILA ( ▼ 3.79% ) proves the point from the other side. It carries roughly $7.7 billion in net debt, a fraction of América Móvil's load, yet sits at 4.5x leverage, the only name among the region's ten largest operators past the 3.0x credit-comfort line that lenders treat as a rule of thumb.
Q1 2026 sorted Latin America's top ten into operators that can spend balance-sheet capacity and operators that must defend it. Ranking the sector by the size of the debt hides that divide. Ranking it by leverage exposes it.
LATAM’s ten largest telecom operators by Q1 2026 net debt, in USD billions. Bubble size reflects the absolute debt load. Source: company filings.
Absolute debt ranks the wrong thing.
The net-debt table and the leverage table describe two different sectors. By absolute net debt, América Móvil leads at $24.3 billion, followed by Liberty at $7.7 billion and Millicom $TIGO ( ▲ 3.61% ) at $7.6 billion, with Telecom Argentina $TEO ( ▼ 0.95% ), Total Play, and Grupo Televisa $TV ( ▼ 1.49% ) clustered near $3 billion, and Vivo $TEF ( ▲ 4.62% ) and Megacable anchoring the bottom near $2 billion and $1 billion. By leverage, the order inverts. Vivo sits at 0.4x, net cash once leases are stripped out. TIM Brasil $TIMB ( ▲ 1.78% ) sits at 0.82x on the same basis. Megacable reports 1.25x. América Móvil's 1.41x places the region's largest borrower in the conservative half of the table.
Q1 2026 net debt to EBITDA. The dashed line marks the ~3.0x credit-comfort threshold, a sector rule of thumb, not a covenant. Source: company filings.
The stretched names carry far less debt in absolute terms. Liberty at 4.5x, Millicom at 2.76x, and Total Play at 2.62x top the leverage ladder while ranking mid-pack or lower on absolute debt. The number that sets refinancing cost, rating headroom, and the freedom to return capital is the ratio of net debt to cash generation, not the height of the debt stack.
América Móvil cut net debt by roughly Ps.20 billion in December 2025 and holds investment-grade access at all three agencies. Total Play, carrying less than an eighth of that debt, had to swap US$600 million of 2028 notes into 11.125% secured paper due 2032 to push its maturities out. Same sector, opposite balance-sheet reality.
Identical payouts, opposite permissions.
The clearest test of a balance sheet is what it lets an operator hand back. Two 2026 distributions look comparable on paper and mean opposite things underneath.
Vivo committed R$6,990.0 million of shareholder remuneration for 2026, about US$1.35 billion at current exchange rates, combining a R$4,000 million capital reduction and R$2,990 million of interest on capital, alongside a buyback of up to R$1.0 billion and a pledge to distribute at least 100% of 2026 net income. At 0.4x leverage, that is textbook cash-machine behavior.
Liberty Latin America declared a special distribution of 9.0% preferred shares worth roughly US$500 million and resumed buybacks in March 2026, its first since the first half of 2024. Liberty returned that capital at 4.5x. The same telco playbook ran at very different balance-sheet permission.
Leverage License is the set of corporate actions a balance sheet permits, set by net debt to EBITDA rather than by the absolute size of the debt.
América Móvil shows the discipline the concept implies. The board lifted its buyback fund to roughly Ps.21 billion, then signaled it would not meaningfully accelerate repurchases until leverage moves toward 1.3x. Vivo's license is wide because its leverage is low. Liberty is exercising a license its leverage does not comfortably support. The dollar amounts returned say little on their own. The ratios behind them say almost everything.
Televisa shows the license can be revoked.
The sharpest development of 2026 is an operator losing its Leverage License in real time. Grupo Televisa entered the cycle as an investment-grade anchor and left it a high-yield name.
Moody's cut it to Ba1 from Baa3 in July 2025. Fitch followed to BB+ from BBB- in December 2025. S&P moved it to the bottom investment-grade rung with a negative outlook, disclosed in Televisa's 8 May 2026 filing. Moody's cut again to Ba2 in June 2026. The cause was structural. The decline of its Sky satellite business and weak izzi broadband momentum eroded the EBITDA that anchors every leverage ratio. Net debt barely moved, near Ps.49.75 billion. The license narrowed anyway, because the cash generation beneath it weakened.
Televisa's response confirms the logic. It suspended its 2026 dividend, then in June 2026 raised MXN 6.9 billion, about US$400 million, through zero-coupon mandatory convertible debentures placed privately with its controlling shareholders, equal to roughly 19% of its capital, earmarked for potential Mexican telecom deals, capital spending, and debt prepayment. It is reportedly weighing AT&T's Mexican unit. A name with a strong license borrows to expand. A name that has lost one dilutes its owners instead.
The leveraged consolidators spend their license on purpose. Millicom re-levered from 2.17x at the end of 2025 to 2.76x to absorb Colombia's Coltel, which added roughly US$1.5 billion of net debt on consolidation, and guides back toward 2.5x by year-end. It is holding its US$3 per share dividend until leverage returns to target, with room for additional dividends or buybacks of up to 10% of equity once it drops below that mark.
Telecom Argentina took on dollar debt to absorb Telefónica Móviles Argentina, a US$1,245 million deal funded with US$1,170 million of loans, now under a conditional ruling from Argentina's competition authority. Both bought scale from Telefónica's "Transform and Grow" retreat from Spanish America. Spending the license is a strategy. Losing it is not.
What the divide means for the next print.
The rate backdrop widens the gap rather than closing it. Banxico cut to 6.50% on 7 May 2026 and held unanimously on 25 June, formally ending its easing cycle and lowering future refinancing costs for peso-funded operators such as Megacable, which carries 100% peso debt, and América Móvil.
Brazil's Selic eased to 14.50% in late April off a near-20-year high, with the year-end consensus near 12.25%, which helps Vivo's 99% local-currency, fully hedged book and TIM. Dollar-heavy borrowers gain less. Telecom Argentina's new notes price between 8.50% and 9.25%, and Total Play's secured notes carry an 11.125% coupon. Falling local rates reward the operators that were already conservative and do little for the ones that are stretched.
The read-across is entirely regional this week. The divide is internal to Latin America, not borrowed from a global comparable.
What to watch into the next print:
Millicom reaching 2.5x or below by year-end, the test of whether the Colombia bet paid for itself.
Banxico holding 6.50% and Selic falling below roughly 13%, the refinancing tailwind for peso and real borrowers.
Any further Televisa downgrade, since the S&P negative outlook would drop it below investment grade at all three agencies.
A Liberty Puerto Rico distressed exchange, which Fitch has already flagged at CCC.
The competition authority's final ruling on the Telecom Argentina and Telefónica Móviles deal.
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