Release Date: July 23, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Telekom Austria AG (WBO:TKA) reported a solid total revenue growth of 4.1% in Q2 2025, driven by strong performance in international operations, particularly in Belarus, Croatia, and Bulgaria.

The company achieved a significant increase in free cash flow, reaching 333 million, nearly 100% more than the previous year, due to lower capital execution and optimized working capital utilization.

Telekom Austria AG (WBO:TKA) added 330,000 new postpaid mobile customers, with 30,000 in Austria, demonstrating strong customer acquisition efforts.

The IoT business saw substantial growth, with over 2 million new subscribers added across the group.

The company confirmed its guidance for 2025, expecting total revenue growth of 2-3% and maintaining a capital expenditure target of around 800 million, excluding spectrum costs.

The Austrian market remains challenging due to a weak economy and high competition, particularly from MVNOs, impacting service revenue growth.

EBITDA declined by close to 1% in Q2 2025, partly due to increased investments in advertising, commissions, and subsidies in Austria.

The fixed broadband customer base in Austria declined by 37,000, reflecting difficulties in the fixed-line segment.

The company faces regulatory challenges in Austria, with high fiber rollout costs and low take-up rates, hindering further fiber investments.

Telekom Austria AG (WBO:TKA) is experiencing a decline in Austrian mobile ARPU, exacerbated by lower indexation rates compared to the previous year.

Q: When you introduced the full-year guidance, you mentioned that the 2 to 3% growth would be mostly from service revenues. Given the high equipment growth in the first half, is service revenue still the main driver? A: We see a balanced growth between hardware and service revenues. In Austria, as we push more customer acquisition, we generate more hardware and service revenues. In other countries, ICT hardware is also pushing total revenues. So, while last year’s guidance focused more on service revenues, now it’s more balanced, about fifty-fifty. – Alejandro Blatter, CEO

Q: Can you discuss the competition in Austria and any expectations for changes in the competitive landscape? A: The market is tough, and while we are in discussions with regulators about market dysfunctions, changes take time. The current regulation favors mobile substitution, which is beneficial for us as it offers better returns than fiber investments. We expect the market to clean up as conditions remain challenging, and we are focused on building our customer base and optimizing costs. – Alejandro Blatter, CEO

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