Company Reports

In the early 2000s, Telia overextended its operations, owning majority or minority stakes in telecom firms in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although Telia now remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to perform better, although Telia has launched several cost plans that have borne fruit.

Telia reported a more consistent second quarter than peers Tele2 and Telenor, showing low-single-digit and mid-single-digit service revenue growth across all divisions except Finland, which was flat.

Telia numbers were satisfactory in the first quarter, with service revenue up 2.1% year on year and adjusted EBITDA up 4.0% versus guidance of 2% and 3% growth for 2026, respectively.

In the early 2000s, Telia overextended its operations, owning majority or minority stakes in telecom companies in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although now Telia remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to perform better, although Telia has launched several cost plans that have borne fruit.

Despite solid execution on the cost side, Telia did not meet its service revenue growth ambitions in 2025, something that disappointed investors, sending shares lower by 3%. Service revenue growth came in at 1.5% for 2025 versus guidance of 2%.

The Morningstar Developed Markets Europe Communication Services Index has returned 23.7% year to date, thanks to renewed hopes for consolidation and modestly improving conditions in markets like Italy.

Telia reported 4.4% year-on-year EBITDA growth in the third quarter. The 5% EBITDA growth target for 2025 now seems virtually secured.

During the early 2000s Telia overextended its operations, owning majority or minority stakes in telecom companies in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although now Telia remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to performer better.

Like its Nordic peers Tele2 and Telenor, Telia reported solid second-quarter results, with adjusted EBITDA growth of 6.2% year on year, similar to the first quarter and ahead of 2025 guidance that aims for a 5% EBITDA growth.

We are updating our moat ratings for eight European telecom stocks. European telecom companies lack the scale and pricing of international peers. Network redundancies and little cross-border synergies are common, and the regulatory landscape is not supportive of competitive advantages.

During the early 2000s Telia overextended its operations, owning majority or minority stakes in telecom companies in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although now Telia remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to performer better.

During the early 2000s Telia overextended its operations, owning majority or minority stakes in telecom companies in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. We believe Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although now Telia remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to performer better.

Telia’s group revenue came in slightly above company-compiled consensus. Service revenue grew 1.8% organically year on year, while adjusted EBITDA increased 6.7%, outgrowing revenue thanks to broad-based cost reductions.

Narrow-moat Telia reported slightly weaker than expected fourth-quarter 2024 results, with the key Nordic markets of Sweden, Finland, and Norway growing like-for-like service revenue by 0.5%, negative 0.3%, and negative 0.6%, respectively. Strong results in the Baltic region left group-level service revenue growth at 1.5% for the period. Improved profitability in TV and media, as well as in Finland contributed to 5.8% adjusted EBITDA growth. Management made no changes to their 2025 outlook for service revenue growth of around 2% and adjusted EBITDA growth of at least 5%. We plan to incorporate these results into our model, but don't expect to change our SEK 29 fair value estimate.

During the early 2000s Telia overextended its operations, owning majority or minority stakes in telecommunication companies in countries like Nepal, Turkey, Russia, Uzbekistan, Kazakhstan, and Georgia, among many others. We believe Telia’s management realized the lack of competitive advantages far away from home and began to shrink its operations, divesting most of these businesses in the past five years. Although now Telia remains focused on the Nordics and Baltics, it is still present in seven countries, something we believe creates inefficiencies. Telecom operators that remain narrow and focused on their home markets tend to performer better.

Narrow-moat Telia reported a third-quarter revenue decline of 1%, driven by slightly weaker service revenue growth. EBITDA growth was slightly stronger, roughly flat year on year. These results come in the wake of Telia's recent capital markets day, when management presented new midterm guidance for a 2% service revenue compound annual growth rate and 4% adjusted EBITDA CAGR through 2027. Our forecasts remain more conservative than management owing to the structural challenges we feel the telecom industry faces and the unabating competitive dynamics in Telia’s core markets. These results are broadly in line with our expectations. With no changes to our forecasts, we maintain our SEK 29 fair value estimate. Shares are slightly overvalued.

Telia's second-quarter revenue grew by 2.3% with service revenue growing ahead of company-compiled consensus estimates at 3.3%. Similarly, EBITDA was ahead with 6.4% growth, boosted by ongoing cost restructuring and, more surprisingly, on the back of TV and media returning to growth and positive EBITDA. However, we caution investors not to extrapolate any trends in the TV business as its performance has been lumpy for many years. Overall, these are a good set of results and shares were up over 4% in early trading. Management made no changes to guidance and we continue to believe Telia is on track to meet its outlook for low- to mid-single-digit growth in EBITDA and low-single-digit growth in revenue. We maintain our SEK 29 fair value estimate.

Telia’s first-quarter revenue declined by 2%, with 2.2% growth in service revenue offset by lower equipment sales. EBITDA performance was stronger, up 4.6%, boosted by a 5% decline in personnel and other operating expenses in reported terms. Telia has started the year on track to meet its full-year guidance and expects low- to mid-single-digit growth in EBITDA and low-single-digit growth in revenue. We maintain our EUR 29 fair value estimate.

One highlight in narrow-moat Telia's fourth-quarter 2023 results was a SEK 4.1 billion noncash impairment charge that had already been announced on Jan. 24. The charge corresponded to the Finland (SEK 2.8 billion) and TV and media (SEK 0.9 billion) divisions. The TV and media business has been a continuous headache for Telia since 2020 and was a poor capital allocation decision in our view. Affärsvärlden, a Swedish business magazine, has reported Telia could be considering a sale of its TV and media business, a decision we consider to be favorable, given it is in structural decline. We maintain our SEK 29 fair value estimate as the poor performance of TV and media was offset by strong revenue and EBITDA performance in almost all geographies.

During the early 2000s Telia overextended its operations, owning majority or minority