Telecom Italia SpA – 2025 Financial Results and 2026 Outlook
Telecom Italia SpA (Milano), a diversified telecommunications provider listed on the Borsa Italiana, announced its 2025 financial results during a press briefing on 27 February 2026. The company’s performance was broadly consistent with market expectations, and its guidance for the forthcoming year provided a clearer view of capital allocation priorities amid a volatile European equity landscape.
2025 Financial Highlights
| Metric | 2025 Value | 2024 Value | YoY Change |
|---|---|---|---|
| Revenue | €12.8 bn | €12.3 bn | +4 % |
| EBITDA | €3.1 bn | €2.9 bn | +7 % |
| Adjusted EBITDA | €3.0 bn | €2.8 bn | +7 % |
| Net Income | €1.9 bn | €1.7 bn | +12 % |
- Revenue grew modestly at 4 %, driven mainly by incremental traffic and incremental service‑bundling revenue.
- EBITDA and Adjusted EBITDA met analyst forecasts of €3.0 bn, reflecting disciplined cost management and a continued emphasis on network optimization.
- Net income rose by 12 % owing largely to the one‑off tax benefit from the sale of non‑core assets.
Capital Allocation and Share‑Price Strategy
Management disclosed a potential share‑buy‑back program that would be activated after two conditions are satisfied:
- Completion of the Sparkle asset sale – the divestiture of the company’s wholesale fiber‑optical infrastructure unit, expected to generate €1.5 bn in proceeds.
- Reverse share split – a planned 2‑for‑1 reverse split to align the share price with European peers and reduce volatility.
The company emphasized that the buy‑back would be “conditional and not mandatory”; it would be triggered only if the company’s liquidity position allows for it without compromising strategic investments.
2026 Guidance
- Capital Expenditures (CAPEX): Telecom Italia will cap CAPEX at 2.5 % of revenue for 2026, a slight increase from 2.2 % in 2025, aimed at supporting the rollout of 5G in key urban corridors while keeping debt servicing manageable.
- Free Cash Flow After Leasing: The company projects €1.8 bn in free cash flow after leasing, representing 18 % of revenue. This figure is an improvement over 2025’s 16 % and underscores a shift toward more efficient use of existing infrastructure assets.
- Debt Profile: Net debt is expected to remain below €6 bn (approximately 48 % of EBITDA), reflecting a modest increase in debt used to fund strategic acquisitions in the mid‑term.
Market Reaction
The Milan market showed a muted response to the announcement. Late trading recorded a modest gain of 0.2 %, largely driven by the SPIVA benchmark showing a 1.5 % return for the Milan Mid Cap Index. Investor sentiment remains cautious due to broader European market volatility, particularly in the banking and industrial sectors, which are sensitive to policy changes and inflation expectations.
Sectoral Context
Telecommunications, like many infrastructure‑heavy sectors, is experiencing a convergence of digital transformation and regulatory shifts. The rise of 5G, the push for net neutrality, and increased scrutiny over data privacy all influence the competitive positioning of incumbents such as Telecom Italia. Comparatively, the energy sector’s transition to renewables and the automotive sector’s electrification create analogous capital‑intensive landscapes, where disciplined CAPEX and efficient cash‑flow generation are common success drivers.
Conclusion
Telecom Italia’s 2025 results and 2026 outlook illustrate a firm that is balancing incremental growth with rigorous capital discipline. The conditional share‑buy‑back proposal, contingent on the Sparkle asset sale and a reverse split, reflects a strategic approach to shareholder value creation that is mindful of macro‑economic uncertainties. For investors and analysts, the company’s performance underscores the importance of evaluating core operational metrics and capital allocation frameworks across seemingly disparate industries to gauge long‑term resilience.
