Telia (TELIA) Q4 2025 earnings summary

Executive summary

• Achieved first dividend fully covered by free cash flow in five years, with no vendor financing, and delivered on EBITDA and free cash flow ambitions despite challenges in Norway and Finland.

• Implemented a country-led operating model, resulting in improved efficiency and a net reduction of 450 positions, with further restructuring reducing 600 positions and creating 150 new roles.

• Advanced portfolio management with the sale of TV and Media, agreement to divest Latvian operations, and acquisition of Bredband2.

• Customer satisfaction (NPS) improved across most markets, with best mobile network awards in Sweden and Estonia.

• Sustainability progress included 65% of supplier emissions covered by science-based targets and digital inclusion initiatives reaching 3.6 million people.

Financial highlights

• Service revenue grew 2.1% in Q4 and 1.5% for FY 2025 like for like, driven by strong Swedish and Baltic performance, but offset by declines in Finland and Norway.

• Adjusted EBITDA increased 3.7% in Q4 and 5.2% for FY 2025 like for like, with margin improving to 39.4%.

• Free cash flow reached SEK 9.6 billion (normalized), significantly above the SEK 8 billion outlook, and comfortably covered dividends.

• CapEx for 2025 was SEK 12.8 billion, below the improved guidance of SEK 13 billion.

• Leverage improved to 1.93x from 2.28x, with net debt reduced by SEK 9.8 billion.

Outlook and guidance

• 2026 guidance: service revenue growth around 2% like for like, adjusted EBITDA growth around 3%, CapEx below SEK 13 billion, and free cash flow around SEK 9 billion.

• Mid-term ambition: service revenue CAGR 2%, adjusted EBITDA CAGR 4% for 2025-2027, and free cash flow above SEK 10 billion by 2027.

• Dividend proposed to increase from SEK 2.00 to SEK 2.05 per share, to be paid in four tranches.

• Free cash flow in 2026 expected to be back-end loaded, with a soft Q1 due to working capital reversal and high interest payments.