Tele2 (TEL2) Q4 2025 earnings summary

Executive summary

• Achieved or exceeded all 2025 guidance KPIs, including 42% equity free cash flow growth and 11.4% underlying EBITDAaL growth, supported by disciplined cost control, revenue growth, and a 15% workforce reduction.

• Completed major operational milestones such as the 2G/3G shutdown and fastest 5G rollout in Sweden, reaching 99% population coverage.

• Recognized for sustainability leadership, ranking #1 in Europe for child rights integration and receiving an 'A' score from CDP for climate change efforts.

• Board proposed a dividend of SEK 10.50 per share for 2025, up 65% and equivalent to 118% of equity free cash flow, to be paid in two tranches.

Financial highlights

• Q4 end-user service revenue grew 4% year-over-year; underlying EBITDAaL up 13% organically to SEK 3.0 billion; full-year underlying EBITDAaL up 11.4% to SEK 11.7 billion.

• Full-year equity free cash flow increased 42% to SEK 6.2 billion; net profit for 2025 was SEK 4.6 billion.

• CapEx to sales ratio at 11% for both Q4 and full year; 2025 capex to sales at 10.8%.

• Net debt reduced by SEK 1.9 billion to SEK 24.3 billion by year-end; leverage at 2.1x underlying EBITDAaL, within investment grade range.

• Earnings per share for 2025 was SEK 6.62, up from SEK 5.59 in 2024.

Outlook and guidance

• 2026 guidance: low single-digit organic growth in end-user service revenue, low to mid-single-digit organic growth in underlying EBITDAaL, and capex to sales of 10-11%.

• Guidance excludes impact from the Baltic tower transaction, expected to close in Q1 2026.

• Dividend policy updated to distribute at least 80% of equity free cash flow, maintaining investment-grade credit rating.

• Cautious outlook due to macroeconomic and geopolitical uncertainties, with continued focus on cost discipline and agility.