Far EasTone Telecommunications Co Ltd
TWSE:4904
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Far EasTone Telecommunications Co Ltd
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Welcome, everyone, to Far EasTone's 2022 Second Quarter Earnings Conference Call. [Operator Instructions] For your information, a webcast replay will be available within an hour after the conference is finished. Please visit www.fareastone.com.tw under the Investor Relations section.
Now I would like to introduce Mr. Gary Lai, the IR Officer. Gary, please proceed.
Good afternoon, everyone. Thank you for attending Far EasTone Second Quarter 2022 Results Conference Call. Today, our President, Chee and CFO, Sharon, both join the call with us. Before Chee's presentation, please pay attention to our first page safe harbor statement. Let me pass to Chee. Thank you.
Okay. Thank you, Gary. Good afternoon, everyone. Thank you for attending our second quarter IR call. So to give you some update, we start with the financial performance that we have. So we actually had another very good quarter. So as you can tell that we are beating the guidance across all lines. And for example, our total revenue, and it is now 6.3% Y-o-Y. So if you look at not only we beat our target BOD target in terms of Y-o-Y growth, and it is also a very good quarter. So our EBITDA is 9.4% year-over-year. And then also net income and EPS is both still are in the double digits, 17.2%.
And in terms of cumulative for the first half, we are looking at NT$ 42.63 billion and then for the revenue, and it is almost 6% Y-o-Y growth compared to the same time last year. And then of course, we achieved the rate, the BOD rate, just about 100.6%. And our year-over-year guidance for revenue is NT$ 88.79 billion. So we are on target to meet that if not exceed it. In terms of the EBITDA, the first half, we have accumulated NT$ 15.21 billion. And compared to the same time last year, it is a 10% year-over-year growth. Net income and EPS are also both in double digits, and it's more than 20%. As you can see, 22.5% growth year-over-year. And then in terms of target rate achievement, it's also 103.6%.
And then look at our fundamentals. So we have been continuously to improve our net debt and net debt-to-EBITDA ratio. So if you look at -- we were at NT$ 52.59 billion debt, net debt for the first quarter and then we have now come down to NT$ 49.97 billion. And then the net debt-to-EBITDA multiple is from 1.82x to decrease to 1.69x. And in terms of the cash flow, the free cash flow, it is sound -- remains to be sound and healthy. So we have increased that from the NT$ 5.15 to NT$ 8.95 year-to-date. And our cash-based CapEx, we are on target. As of the first quarter, it was NT$ 2.34, and now we have spent up to NT$ 4.7. And our CapEx target for this year is NT$ 11.1 billion. That is still the case, okay?
Next slide, okay. And some more financial highlights. For example, the revenue -- for our revenue since fourth quarter 2020, we are on the growth momentum. And then so this is a seventh straight quarter that we have Y-o-Y positive and then it's a 6.3% Y-o-Y for this quarter. And in terms of EBITDA, we actually scored a record high for NT$ 7.6 billion since 2018 fourth quarter, okay. This is the 9.4% year-over-year growth was mainly contributed by our better service revenue margins and also the ongoing cooperation with APT, okay.
And in terms of the EPS for the second quarter net income reached NT$ 2.3 billion. And our EPS is another quarter of NT$ 0.71. It actually grew 17.2% Y-o-Y, it's highest in the industry, okay. And look at our Mobile Service, it is a continuing growth to grow and then very -- with very solid growth. So if you look at several quarters in a row, and then this, of course, has a lot to do with the 5G uplift and then we look -- we are looking at 2.5% Y-o-Y for this quarter. And then also in terms of the postpaid ARPU, we continue to be leading the industry and then it's now at $719 per month, okay.
And for our 5G postpaid penetration, it's steadily growing. So it is growing at a pace that we are very comfortable with. And of course, we would anticipate in September iPhone usually would boost even more conversion with the bundled offers and also all that nice some goodies that we add on top of it. But then so far, the penetration has been steady as we expected and as we preferred. And then for the postpaid churn rate, it continues to come down, and we actually hit a record low and below 1% to 0.98% in this quarter -- in this past quarter, okay.
All right. And our new economy continues to be our growth engine. So we actually grew 22.7% year-over-year, for the first half together and accounted for 18.9% of our total first half of new economy revenue. And this is also our goal for this year. So if you can tell from the chart on the left-hand side, so in 2016, the new economy revenue accounted for 5% of the total FET revenue that it has been growing since. So last year, we scored 17% for the new economy over our total revenue and this year's goal is to be 18.9%.
And for the first half, we actually already achieved that. And our enterprise is doing particularly well. So you can see in the past, it's about half-half, right? 50% of new economy revenue came from enterprise and it became 51%. And then for the first half, it is now showing a 56%. So we are doing very well in the ICT revenue, in the ICT area as a whole, Smart ICT.
And then it's worth mentioning the cloud service is growing very well, and we are seeing a strong growth at 60% year-over-year. And also our IoT solutions, which is some -- a lot of those are our home -- based on our homegrown solutions. So we got pretty good margin out of those as well. And it's also showing very strong growth year-over-year, like 70%. And for the consumer part, our friDay video service, the paying user subscribers, we are seeing up 18% year-over-year growth.
And our e-commerce even though this year, the pandemic kind of came back with Omicron but then compared to last year, a lot of folks when the pandemic first hit Taiwan, so there was a lot of e-shopping, right? And people were accumulating food and groceries and all that, don't know if the CDs will be shut down and all that. But this year, people are a lot calmer. But even with that, we are still scoring a double-digit growth and to add 10% for our e-commerce, okay.
And then so we also have some network highlights. For example, we had -- as some of you may recall, our 5G spectrum sharing deal with APT, that included a second phase, a prerequisite for a second phase to start would be if the authority has authorized the 4G spectrum sharing, or we would swap our 2,600 TDD spectrum with APT 700 LTE spectrum because they had 15 megahertz and then we would swap for 5 megahertz out of it. So we went ahead did that and this is to improve our network overall because the 4G is really congested at times and then with 700, the low band, it is very powerful. So this would -- and this actually improves our outdoor coverage by more than 10%, especially for those previously underperformed areas.
And then also for the indoor performance, it improved by 22% because of strong penetration by the low band. And then also, it helped release the peak hours congestion that we see by the data traffic. And then the relief is as high as like a 15%. So it was a very good launch and then it didn't take us long to get it launched everywhere island-wide, nationwide. And also, we were the first company and the Ericsson and then Far EasTone, we were the first to demonstrate successfully how to do the 5G as a -- using 5G as a slicing technology that globally.
And then in Taiwan, we are also the first to actually use this technology and then demonstrated it in Kaohsiung and so we work with the police department there in their smart patrol cars. So this is a successful POC, they actually also get some recognition for that. And then we are working with them to further expand this service.
And we also signed MOUs with 3 universities here to build the 5G smart campus for them. So this will be using 5G technology. So -- and also on top of it, we will do the monitoring, the call monitoring, the patrol and use big data analytics. So this is a very typical, like we said, big data, AI and IoT kind of application on top of our robust 5G network, okay.
And also from the -- for the ESG, which is something have been doing. And so we are very happy to join as the first carrier in Taiwan that joined Ericsson's Global Product Take-Back Program. This is going to recycle up to 98% of the waste electrical and electronics equipment materials. And then that is much higher than what was recommended by EU's WEEE Directive. And then so only 2% of all that waste will be buried. So this is really good news because from the environmental perspective that is a very good program.
And then -- and we actually are expecting by the end of this year, we will have retired more than 10,000 3G and 4G radio stations for recycle. So this is a big step, and we are very happy that Ericsson has this program, and then we are happy to be part of it, okay.
All right. And then as I mentioned earlier, our enterprise actually drove very good growth for our new economy in the Smart ICT area. So some highlights included, we look at the contracts that we have signed during the first half. It is 38% growth year-over-year. And then we have some big wins, major wins. They are all bigger than NT$ 100 million kind of insight. So there are several of them. And then so for example, drivers included this digital transformation that is happening or demanded in the public sector and government agencies and also in some big brand name kind of enterprise as well.
So the first one that is a new generation fixed mobile convergence project for brand name store chain or convenience store chain in Taiwan that we have got the contract with them to do the digital transformation project with them and then start with some infrastructure upgrades or free planning. And then on top of it, there will be some smart applications on top of it as some different phases go on.
And then the second actually is a bunch. We have several smart surveillance solution related, the IoT related for multiple government agencies and affiliates. And these, as I touched on earlier, the smart IoT solutions used our homegrown solutions, so this is the type of project, we actually prefer because we are able to reuse our homegrown solutions and continue to expand services and all that.
And then for EMS, this is our Energy Management System or we have a platform that we homegrown we built. And then we did that for the -- for every classroom has a air condition program previously. So more than 1,300 schools that we have as EMS deployed to manage their electricity usage after they all have the air conditions installed. And the same EMS platform that we are using different functions on it that we are going to support Taipower because we are building a Microgrid System Project in Penghu Island. And this is in collaboration with our subsidiary, EcoPower is building the solar plant, okay.
And also, we have expanded our telemedicine platform for On-Line Clinic, this is -- this was really urgently needed during the peak of the Omicron crisis in Taiwan. So we were actually working with our affiliated hospitals in our group and then work with them to help to CDs here, Taipei, new Taipei.
So this will support the residents because they were advised to stay home and not to go to the hospital if their symptoms are not strong or not severe, they can just stay home. But then for them to stay connected with the health care personnel. So how to do that, how to assist that. From an online perspective, they need a platform that is secure and that is also convenient. And then they can just do that from their mobile. So we did that. And then the daily users grew 20x more than during the peak of the Omicron.
And then -- and this is built based on the same telemedicine platform that we have previously launched with the 5G, and that we are working with Ministry of Health and Welfare that we are advancing these telemedicine services to all the rural health care centers. And so far, we have already covered 33 of them that are across 12 different counties. And this effort is a multiyear project. So next year, and this number will continue to grow, and this is a multiyear project we have been doing with the government, okay.
All right. And then we have got some awards and recognitions for the second quarter, kind of feel from our CSR or ESG related. So the first one is from the local famous business magazine and then we had the Overall ESG Performance Role Model Award. And then from Institutional Investors, myself and my IR team have been awarded the best in 2 years in a row. So we are very honored and then very humble by that. And our telemedicine service platform has received the certification from the HIPAA in the state. And this is the first platform of this kind that have received the certificate, which will be required to do the kind of telemedicine service according to our regulatory requirement here.
During pandemic, there were exceptions. So people were using different OTT to do that because of the pandemic. But then once that is back to normal in order to provide that kind of service, this HIPAA certification is a must. So we are the first one to receive that, and we are ready for that already, okay. And then we have also got the Industrial Safety and Health Association Award, the Golden Award. And our service is really well known. And then for 11 years in a row, we have got The Best Service in Taiwan. This is across all verticals. So this is not just about telecom, it's a service industry period. So we were the best. We have been the best 11 years in a row, it's a Golden Award, and this award actually started 11 years ago. So we are the only one that has been receiving the award nonstop. So 11 years in a row, okay.
So for the second half priorities, we will continue to promote because we see the demand on the Digital Transformation. And we have joined forces with our -- we have our IT department to join forces with our enterprise BU to promote the Digital Transformation Consulting Services because still many companies, they are looking for help in this area, and they don't know necessarily exactly what needs to be done, so we need to start with consulting service like a presell. So we have this all set up, and then we will promote it more. So there are more companies or enterprise aware of this service.
And also seeing the need and the demand in the ESG solutions, we are expanding our current EMS platform to support the growing demand that we see in this Green ICT area. And also, of course, in September, the new iPhone will be launched, and then we are getting ready for that. And then as I mentioned earlier, this will definitely boost more bundled 5G services. And also, our Mobile Circle, which is a digital platform, and this is where we will promote our digital services and strengthen our loyalty program. And then this is to improve our customer experience and then we want to treat our users like members. So this -- and then this Mobile Circle will be our digital reach program that we will continue to enhance.
And then last but not least, we will pursue this regulatory approval for FET/APT, which is actually moving along. So far, both Fair Trade Committee and also NCC has held a form separately. FET held it in May, back in May, and NCC just had it like last week. So this is with like scholars and then some officials and with the telcos. So we had a closed door discussion and presentation. So both have done that. And for NCC, the next -- that they will have a hearing that will be in September. But as far as we can tell, things are moving along. The feedback we from the scholars, they all kind of in support of this merger for both cases, actually, okay.
All right. Okay. So with that, I will conclude my presentation for you all, and then we will welcome your questions now.
[Operator Instructions] Our first question is coming from Neale Anderson, HSBC.
I have three questions, please. The first one is on mobile postpaid ARPU. So $719 in the quarter, and that's quite a bit higher than the previous 5 quarters. So were there any one-offs in the quarter that drove that rise? And do you expect that to continue at these levels?
The second question relates to the APT cooperation. So you mentioned the EBITDA, that record high is due to in part to APT cooperation. Again, was there anything that changed particularly in the quarter? Is it just more volume that's driving that EBITDA growth?
And then the final query relates to 5G. And I know you started the network slicing with the police. 5G has obviously been rolled out for a while, and this is one of the first types of sort of live trial, if you like, or live service that we're seeing. Do you expect that pace to pick up now. Now you've got a proof of concept that's live and working? Or is it still pretty slow and persuading government and enterprise customers with the benefits of 5G?
Okay. All right. Thank you, Neale, for your three questions. So I'll answer them one by one. So the first one is for mobile, right? So this will be -- this is contributed by as we convert more 5G customers, right? So you look at how we calculate ARPU. So the numerator is becoming bigger, right? And the denominator is the same in terms of the number of subscribers. So this number will continue to grow, and that's what I would expect, okay. That's to your first question.
And then the second question is on the APT cooperation. So this is the amortized expense or the cost that they pay us, right? So for both the spectrums and then also other depreciation, CapEx, depreciation, OpEx sharing and all that, and then we amortize it accordingly. So this will just add up. And then this is also steady. And then also another is we have -- there's still MVNO service that we granted them and then that will continue to generate revenue as well. So those are what I was referring to as the APT cooperation, okay.
And then for the third one, 5G slicing. You are right. So that one is actually although it's a police department. It is still, to us, it's not consumer type of application yet. I still would see, for example, like the telemedicine, right? Although right now, we -- the Ministry of Healthcare and Welfare, their focus is how we make the rural areas to -- those are like less advantaged areas. They can get as good medical services as the urban area. So the focus has been there and then it is not through the individual consumers anywhere yet. However, they have since relapsed on the scenario where telemedicine can be applied and also be reimbursed the insurance, which is important for the adoption of this service.
So we are seeing more scenarios that will be applied. And then that's why during pandemic, even to we did that for free during that time to make this online app available and then people can download it on their mobile. But that is kind of like the prelude to such consumer-driven -- consumer-facing applications. And that's what I would consider when that becomes more prevalent or as the regulation on this health policy is more relaxed, there will be more adoption. And that's when people will definitely see the difference between having a 4G service versus the 5G service because you do want your doctors to see you and then your symptoms and then your charts and all that with no lag and with good resolution.
So there, the 5G versus 4G will make a difference and people see that and people will take it seriously. Thus, if you ask me what would be a core application. And I'll say it is not about independent, it is about your health. And then sometimes it could be life-threatening. So that will be something like that.
And then the other area that I would say, for 5G, we have heard enough about members AR/VR. But that's all kind of like, it's not critical demand. Maybe there are some people kind of like that, want that, but it's not something they need. So that won't take time to take off. However, for AR and VR type of applications, there's still a lot of the applications we already have today, like watch the videos, right, with the 3D and all that.
We have the technology advancement can already make them a more acceptable solution and make it more prevalent. We don't really need to have metaverse or kind of handed out to see the benefit. So that is where I see the 5G kind of application for users will take up more.
And then also another driver would be kind of from the not-so-positive side, that is as more people using more data, which is the data usage we see from our statistics or from our data just continues to grow. Every month, it's growing. It's growing. So 4G is getting congested.
Eventually, you can say, well, yes, 4G is great when nobody is traveling on it, right? Like you have a great highway you built just a few years ago. But then when you are -- we don't have many cars on it, it's great. And then say, why do I need another highway. But when there's full of cars and people couldn't really move fast enough on this highway, you will think about if there is another one that you can -- the congestion could be released and then 5G will be the solution.
So I think it's from both of the new applications and also from the fact people users or with the consumers, in general, their demand for data is growing daily. And then our 4G capacity is fixed. So 5G is a solution to that. So sooner or later, they just have to be moved to 5G, so they can use both 4G and 5G. So there is enough driver, as I can see. That's why we see a steady conversion, right from the user base we have. Okay, I hope that answered your question, Neale.
It did. It's very interesting to get your thoughts on the 5G side and particularly the health element. If I could just follow-up on the postpaid ARPU side, so I understand that it's greater volume of 5G customers.
In other markets, as you sort of move towards 30% adoption, the uplift has dropped, which is kind of what you'd expect, I guess, because the high-spending users, the high-value users move first. But it sounds like that what you're seeing is, you're seeing a fairly consistent uplift. As you say in the slide, it's above 20%. And is that volume that's driving the increase in ARPU, have I got that right?
Right. Because it's kind of ironic, right? So for those that were already at a high rate for the 4G plan, those were the ones that we feel they are the likely early adopters kind, right? So we approach them first. But then if you think about it because their rates already was higher, so the delta from their current rate or the 4G rate to the 5G rate, actually, the delta will be smaller.
But then if I were able to move a lower rate customer in 4G to 5G, the delta could be larger, bigger. So that's why you get this mix, right? So -- and also because in 5G, so when we move the 4G lower rate planned user to 5G, of course, we wouldn't -- they wouldn't want to move all the way to NT$ 1,399. That's why we have NT$ 999, NT$ 799 kind of offers. But then in terms of the delta, they could be just as big, if not bigger, then those high rates customers that we lose at the earlier stage. So I do expect this to be pretty much about the same or still, yes. Did that help?
That's great. Appreciate it. Yes.
[Operator Instructions] Next, we'll have Peter Milliken of Deutsche Bank.
Great results. My question is really about the congestion that you mentioned. I understand that it will be an issue for all operators. And I'm wondering you -- whether you think the industry may consider lifting the pricing of the unlimited 4G plans as part of the solution?
I wish we could. So I think sooner or later, but then I have to say, I think our consumers have been pampered, if not spoiled, very well. So it's really hard to raise the plan on 4G, right? But then, I would say, at least maybe our focus is more on 5G. So we will put more of our marketing resources on the 5G. So the promotions or campaigns or promotions I'd say. So promotion, sometimes we give some extra goodies and now that will put more on the 5G side. But then for the 4G, we wouldn't entice them with more such goodies.
So that's where we will shift our resources a little bit. But if you want to change your rate plan. And you know we can have -- we are independent operator. So everybody has different strategy. We cannot all do that at the same time and the government say, well, you guys are -- what are you guys trying to do? You're colluding, right? So we cannot do that, and we won't do that.
But then the fact is, if I'm the one to raise the price first, and right away my right, I was waiting to get those customers from me, unhappy customers. So I think people are already used to it. And then our only chance was because 5G is a new technology. It did bring you a lot more capacity, so the rate increase and also not to mention the NT$ 1 billion that we paid on the spectrum. So it's well justified and people can understand they may not like it, but they understand, right? That's only reasonable to raise the rate plan for 5G is higher than what they have now in 4G. Otherwise, who can survive this telecom business, who want to do the telecom business, right? That just wouldn't make any sense.
It was getting frustrating for many of us for a long time, but it's good to see you come out the other side.
And I told them whoever has started with unlimited data program is like a gosh, they don't know what they were doing, right? How can you survive with any business -- with a business model like that, right? So you need to continue to invest in your capacity. But then the more they use, you don't get more money. So what kind of business can survive with that kind of model. But anyway, so -- but then we have technology change. So that gives us like a refresh, right? So they are not everybody will just refresh at once. So that's why we need to do this migration.
But then thank you for bringing up that topic, and they thought raising price on 4G. I don't really think that's going to happen. It's very hard. We will be happy if they are willing to upgrade to 5G, and then that I will be very happy.
So it's a good trend anyway. I have a couple of other quick -- quicker questions. One of them is on the merger and the regulatory approval for that. Has there been any discussions of concessions being demanded for this? I wouldn't think you would need it. You're just going to 5 operators to 4, but sometimes regulators try to push in that direction.
No. Actually, as I shared with you, from what I know, the scholars actually if not all of them, I think the majority of them definitely an absolute majority of them, see the need. And then because, see, this is not the case where we have all companies that are doing well and then just want to get bigger, so to consolidate together or want to merge together. In this case, we are talking about two small telcos that just cannot survive. They've been losing money for so long, right?
And then if this is really a free telecom industry, you let people come in, you need to let people exit, right? So this is not like I want to take over APT or Taiwan Mobile want to take over Taiwan Star. This is the small ones, they cannot really survive. So this is mutually -- the mutual agreement and then they see the benefit, the mutual benefit of doing it. So actually...
Yes. Look it's the best case scenario...
Right. And then the government would know, right, if the big companies like us, that we are paying to kind of clean up the industry, right? Because otherwise, they go bankrupt, it's going to be the cause to therefore to the government to every tax payer.
Sure. I agree. I'm glad that they feel the same way.
So far, yes. Yes. They do see that. Yes.
And just final question for me. The 5G network slicing for the police. What type of services are they getting out of that network slicing?
Okay. So if you are familiar with what's in the state, so -- because that was for AT&T, right? So they have a network called FirstNet and that is for kind of like a dedicated bandwidth for first refunding. So doing disaster, right? So the firefighters, the rescuers, police and all that. They need to make sure their mobile communications will not be affected by all the majority of the users because during pandemic, everybody is calling, right? So they need dedicated bandwidth or spectrums to support their communication doing that.
So this is actually -- this is -- so I use that same idea, and I told my team, I said this is something you could do with our police department, right. So the idea is that so they would have their dedicated spectrum. So if this is going to be rolled out, it wouldn't be just for one city. This will be a nationwide kind of thing. And then we start with Kaohsiung City. So the application gets changed a little bit. So they tried -- they said before, kind of have it totally dedicated, they want to see if they can have dedicated, there they have a receiver in their cars.
So they want to make sure the patrol cars, right, the policing patrol cars have all that dedicated capacity on the 5G with no lag and all that. So in real time, when they are chasing the criminals, they get their information, their communication and all that without any interruption or any possible congestion. So this is kind of a modified smaller scope of application to the FirstNet that AT&T deployed in the state, although that was based on 4G, and we are doing this with 5G. But I stole the idea from my mother company specifically for that.
Next question is from Sara Wang, UBS.
So I have a question regarding new economy business. So how much percent of the enterprise-facing ICT revenue is recurring. And then so far, it seems the growth momentum of the overall new economy segment is quite robust. Do you have any view or any plan of how much of the segment could contribute to total revenue maybe mid to long term?
Okay. So first question, you are asking about the recurring. So for ICT actually, a big part of it is like myself, head would tell me, she every year and Chairman first, he felt most depressed because all his revenue from last year were try to reset, right? They start from 0 again. That's what they were telling me in a dramatic way. So that tells you, although, of course, we always have a pipeline. You have carryover from the year before. You have contracts signed.
But then, the point is, ICT business is like every single project, you've got the project, you get it done, you get a onetime revenue and all that. However, more and more that's also part of our strategy. We don't want this ICT to be only a onetime effort because a lot of times after we have done what the customer asked for, they will still need ongoing maintenance or management.
So then we will offer those like maintenance service. So that will be an ongoing subscription kind of a recurring revenue. But then compared to the size of -- like I said, many of them were like over $100 million kind of a contract but then the recurring piece, of course, will be smaller ones. Then those do add up, they are recurring ones they add up. So they become the base, right?
So every year starting January 1, we know they are not really starting from 0 because they already have that base. Every year, there's just so much that will come in, the income, the revenue. So -- but still, we are still at the early stage of building the ICT revenue. So most part of it, they are like -- they are not recurring because they are one-time and then they are each of those new projects or second phase to the same project. But we do see the base for these recurring is increasing, and that's why we actually encourage our team to do, and that's what we should do. So we will see more there for the recurring target.
Okay. And then your second question is about now we are about 18.9%, right? And how much higher it will grow to in the mid- to long range? Right, that's your question? Okay. So I think in 2 to 3 years, I would like to see them 25% into -- my CFO is like, I'm not supposed to get that, right. This is not a forecast, right? I'm okay. Well, just what I would like to, right? So just -- if you show the chart, show the chart from the 5%, if you look at that, we have, yes.
So if you look at that, it's almost like every 2% growth from the previous, right? So if you look at that, so I think in 2, 3 years, for 25% that is a good mid-range target, okay? Because we are -- we started with the telco, right? And then that is still very consumer based. And the consumer base is big. We are talking about millions, right, 7 million worth of subscribers. And after the merger is completed, we are talking about 9 million, right. And then so we want to grow our consumer business, not just with the telecom, but then also with other digital services, with more value-added services. So that's how we continue to grow the ARPU with such a big base like that. I would still think the consumer part of the services will still be the majority of our total revenue.
So 25% if at one point before I retire. So I don't think it will be some 40% or so. For the long term, we -- the time will be very big when the ICT becomes 40%, I think. So I think 25% to 30% will be good. 40% will be -- we will have some major breakthrough or expansion or maybe some M&A in the enterprise area. So right now, I think for the mid-range -- for the mid-term 25%, if you add another 2 years or a stretch, 5 years, maybe 30% would be the top that we'll be looking for.
[Operator Instructions].
I think there were about 10 questions I already answered in total. So maybe that was enough and later on, they can always contact our IR team for further details.
Sure. Thank you for presenting. And I think there are currently no questions, and I'll pass the call back to Mr. Gary Lai. And Gary, please proceed.
Okay. Thank you, everyone, to attend our second quarter 2022 results conference call. See you next quarter.
Yes. And we welcome your feedback anytime, so you don't need to wait until IR team to contact us. Please feel free.
Thank you very much.
Thank you. Take care.
Thank you for presenting. Thank you, Gary. Ladies and gentlemen, we thank you for your participation in Far EasTone's conference. There will be a webcast replay within an hour. Please visit www.fareastone.com.tw under the Investor Relations section. You may now disconnect. Goodbye.