KYIV

• Strategic Overview & Core Telecom Performance

  • The company operates a two-engine model: a resilient cash-generating telecom core paired with a scaling profitable digital ecosystem, with a focus on high-quality customer base growth rather than raw subscriber volume.
  • Mobile subscriber base declined 3% YoY to 21.8 million, driven by churn of inactive low-ARPU secondary SIM cards (a market-wide trend) and demographic shifts from the ongoing war; market share remains stable at ~47%. Key quality metrics improved: annualized churn fell 1 full percentage point to ~14%, ARPU grew 11% to $3.90, 4G penetration passed 70%, and monthly data consumption grew 18% to ~15GB per customer.
  • Fixed broadband customer base grew 11% YoY to 1.3 million households, with nearly 50% of fixed subscribers also subscribing to Kyivstar TV, creating strong cross-ecosystem synergies.
  • Multiplay (bundled mobile + data + digital services) customers reached 8.1 million, up 24% YoY, representing ~40% of monthly active customers. Multiplay customers have a 50% higher ARPU ($5.80 vs. $3.90 for mobile-only customers) and lower churn, driving improved retention and revenue.
  • Starlink partnership: Over 6 million customers have used direct-to-device satellite service, which now offers SMS (free for all customers as a humanitarian service) and low-speed light data (bundled with premium subscriptions or available as a paid add-on). Keapstar is also the first official Starlink reseller for fixed services to businesses and public institutions in Ukraine.

• Digital Ecosystem Expansion

  • Uklon mobility: Active customers grew 8% to 5.2 million, rides grew 4% to 43 million, and deliveries grew 26% to 1.4 million. The company agreed to acquire E-Wings to add electric scooters in 11 Ukrainian cities, completed the first autonomous vehicle testing in Ukraine, and launched a small pilot of Uklon Store adjacent-commerce delivery in Kyiv. Uklon continues to scale in Uzbekistan.
  • Digital healthcare: Healthy health tech served 5 million customers in the quarter, with premium subscriptions nearly doubling to over 109,000 year-to-date, and is deeply integrated into Ukraine's state e-health system. Tablet, the acquired pharma marketplace, served 6.3 million customers in its first full quarter of consolidation, with strong 80% EBITDA margins. Management is working on integrating Healthy and Tablet to create an end-to-end patient journey from appointment to medicine delivery, in line with regulatory requirements.
  • Digital Enterprise & Sovereign AI: Active B2B contracts grew 29% to 2,400, with growth driven by big data/AI services and cloud. The company's 4B parameter Ukrainian large language model Cyber entered beta testing and scored well in local competitive testing. Keapstar signed a memorandum with Ukraine's Ministry of Economy to explore phased development of sovereign AI infrastructure, with all investment planned within existing disciplined CAPEX frameworks.

• Operational & Strategic Developments

  • Completed acquisition of six solar power plants in the Lviv region (105 megawatts total capacity) for ~$81 million in May 2026, bringing total owned solar capacity to 118 megawatts, enough to meet roughly 30% of the company's internal electricity demand. The acquisition improves energy independence, hedges against volatile electricity costs, and reduces exposure to wartime energy instability.
  • The company will host its first Capital Markets Day on November 16, 2026 in New York City, to present medium-term strategy, ecosystem unit economics, and capital allocation frameworks.

• Management raised full-year 2026 guidance for the second time in 2026, citing stronger-than-expected first half performance.
• In hryvnia terms, full-year revenue is now expected to grow 21-23% and EBITDA is expected to grow 17-19% year-over-year. In US dollar reporting terms, this translates to 14-16% revenue growth and 9-12% EBITDA growth year-over-year.
• Full-year CAPEX intensity is maintained at 21-24% of total revenue, with the company noting it has passed the peak of its elevated investment cycle and all new investment remains within a disciplined capital allocation framework.
• Recent acquisitions including Tablet and the solar energy portfolio will add incremental inorganic growth through the first half of 2027.

Total company revenue for 2Q26 was $399 million, up more than 90% year-over-year. Total EBITDA grew nearly 14% to $188 million, and net profit declined 6% year-over-year to $77 million ($0.33 per share), dragged down by a $21 million non-cash fair value charge on listed warrants.

1. Telecom and Infrastructure Segment: Revenue grew nearly 9% year-over-year to $265 million, representing 66.4% of total company revenue. Segment EBITDA was $157 million, with a 59% margin. Mobile revenue posted 7.3% reported year-over-year growth in US dollars, with underlying organic growth of ~5% after adjusting for the May energy acquisition contribution. Fixed broadband revenue grew 11% year-over-year.
2. Digital Ecosystem Segment: Total segment revenue reached $74 million, up 83% year-over-year, representing 18.5% of total company revenue. Segment EBITDA was $31 million, with a 42% margin (a slight 2 percentage point decline from a year ago due to new service investment). Breakdown of digital verticals: Uklon (mobility platform) generated $33 million in revenue (up 50% YoY) and $12 million in EBITDA (up 35% YoY); Healthy (health tech platform) generated $2.4 million in revenue (up 36% YoY); Tablet (pharma online marketplace) generated $7.8 million in revenue and $6.2 million in EBITDA (with an ~80% margin); Kyivstar TV (entertainment) generated nearly $14 million in revenue (up 48% YoY, partially due to a September 2025 switch to gross revenue recognition); Digital Enterprise (B2B services) generated $16.9 million in revenue (up 16% YoY).
3. Energy Segment: The newly acquired 105 megawatt solar portfolio contributed ~$4-5 million in revenue to the quarter, following the May 2026 acquisition closing.

• Geopolitical risk tied to the ongoing war in Ukraine, including potential energy supply instability and exchange rate volatility, both of which are outside management's direct control.
• High competition in digital financial services and fintech in Ukraine, dominated by large established domestic players.
• Regulatory uncertainty for new digital financial services in Ukraine, with new rules not taking full effect until 2027.
• Demographic risks from the large Ukrainian diaspora and population decline, which impacts overall telecom market size.
• All forward-looking initiatives, including sovereign AI infrastructure and fiber backbone consolidation, are subject to wartime operational constraints and post-war market conditions.

Q: What is Keapstar's strategy for sovereign AI and data center investment? Is the national LLM valuable on its own, or is proprietary data the real advantage, and is the data center initiative just a feasibility study? / A: Management believes sovereign AI infrastructure will be a critical national priority for Ukraine after the war, with growing demand from the government. Keapstar's large existing customer base and national telecom network give it a unique competitive advantage to develop and distribute AI services at low incremental cost. Management expects most local AI queries will run on domestic infrastructure, with only the most complex requests sent to global models. All AI and data center investment will be kept within the existing 21-24% CAPEX intensity guidance, and the company is still evaluating options. Kaan Terzioglu added that Keapstar's large existing customer base across all segments gives it unmatched low-cost distribution for any new AI service. (398 characters)

Q: How does the Starlink partnership work, and what is the long-term plan for integrating Healthy and Tablet? / A: Keapstar has two cooperation pillars with SpaceX. First, Starlink Mobile: free SMS for all customers (part of the company's humanitarian mission during the war), and low-speed light data that is bundled with premium multiplay subscriptions or available as a paid add-on for other customers. Second, Keapstar is the official reseller of fixed Starlink hardware and services for businesses and public institutions in Ukraine, a straightforward resale business. For digital healthcare, Healthy and Tablet operate as separate businesses today, but management's long-term goal is to create an integrated end-to-end patient journey from appointment to medicine delivery, leveraging natural synergies between the two platforms. Management is moving deliberately to ensure integration creates shareholder value and complies with regulation. (452 characters)

Q: What is the outlook for digital financial services in Ukraine amid open banking regulation, and could Keapstar become a financial services provider in the next few years? / A: Management has identified digital financial services as a core long-term priority for the ecosystem, building on Keapstar's large existing customer base and large gross merchandise volume (GMV) across its digital platforms. The company is currently in the feasibility stage, due to new untested regulation, high competition from large established players like Monobank, and ongoing regulatory uncertainty. The company is piloting small-scale adjacent commerce in the Uklon app first, and new legislation in 2027 will clarify rules for Uklon's GMV, which will shape further expansion. Management confirmed that holding customer capital and acting as a financial intermediary is a possible long-term outcome, and the company is actively evaluating potential scenarios. (410 characters)

Q: What are the earnings and hedging benefits of the expanded solar portfolio? / A: The solar portfolio provides a strong hedge against rising energy costs, which are Keapstar's largest single operating expense. The company's solar production covers roughly 30% of its internal electricity demand at a fixed average price of ~20 euro cents per kilowatt-hour, insulating the business from energy price inflation and wartime supply volatility. Management expects to potentially expand renewable energy investment further, and could eventually develop a trading role in the Ukrainian energy market for additional incremental profit. The solar portfolio already delivers healthy incremental margins for the company. (321 characters)