Singtel, Southeast Asia's largest telecom operator, is set to raise its capital expenditure to approximately S$3 billion, up from S$2.5 billion the previous year, with a significant portion allocated to artificial intelligence and data center development.
CEO Yuen Kuan Moon highlighted that S$1.2 billion will specifically target growth in AI services, particularly GPU as a service for the region and sovereign AI services for Singapore. Despite reporting a 40% increase in net profit to S$5.61 billion for the year ending in March, bolstered by a one-off gain of S$2.84 billion from selling a stake in Bharti Airtel, Singtel's shares fell over 4%.
The company retains a 27.5% stake in Airtel and sees substantial growth potential in the Indian market, emphasizing the need for digital services. While Singtel anticipates limited direct impact from the ongoing Middle East conflict, it acknowledges potential secondary effects such as inflationary pressures that could lead to higher operating costs and reduced consumer spending.
The firm expects its core capital expenditure to stabilize at around S$1.8 billion, which includes S$1.5 billion for its Australian associate Optus and S$0.5 billion for the rest of the group