Telefonica Earnings: Stable Profits and Launches Takeover of O2D; 2026 Guidance Achievable

We maintain our no moat rating and EUR 4.90 fair value estimate after Telefonica’s third-quarter results and capital markets day. It achieved 2.5% organic revenue growth, which translated into 3% EBITDA growth, helped by cost controls. The strongest organic revenue growth was recorded in Germany and Brazil at 2.2% and 7.5%, respectively. In Spain, the EBITDA growth trend keeps improving with negative 0.5% in the third quarter after four quarters at negative 1%-3%.