Tele2 (TEL2) Q4 2025 earnings summary

Executive summary

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

• Completed 2G/3G network shutdown and expanded 1,800 MHz spectrum in Sweden, enabling 99% 5G coverage.

• Reduced workforce by 650 positions (15%), renegotiated 350 supplier contracts, and transformed to a leaner operating model.

• Recognized for sustainability leadership, including an 'A' score from CDP and top European rankings for climate and children's rights.

• Board proposes a dividend of SEK 10.50 per share for 2025, up 65% and equivalent to 118% of equity free cash flow.

Financial highlights

• Q4 end-user service revenue grew 4% year-over-year; underlying EBITDAaL up 13% organically.

• Full-year underlying EBITDAaL increased 11.4% to SEK 11.7 billion; net profit rose to SEK 4.6 billion.

• Equity free cash flow reached SEK 6.2 billion, up 42% year-over-year.

• CapEx to sales ratio at 11% for Q4 and full year; capex paid decreased due to investment prioritization.

• Economic net debt at year-end was SEK 24.3 billion, leverage at 2.1x underlying EBITDAaL.

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 of 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; cost discipline and prioritization to continue.