The TPG Telecom Ltd (ASX: TPG) share price is in focus after the company provided a first half 2026 trading update at its Investor Day, highlighting continued growth in mobile service revenue and a strong operating free cash flow outlook.
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What did TPG Telecom report?
- FY25 pro forma EBITDA: $1,637 million; FY26 guidance: $1,665m–$1,735m
- FY25 capex (additions basis): $771 million; FY26 guidance: approx. $750 million
- Operating free cash flow (FY25): $1,137 million
- Return on invested capital (FY25): 5.42%
- Dividend per share (FY25): 18 cents; intention to increase as profits grow
- Mobile service revenue growth in FY25: +4.2%
What else do investors need to know?
TPG Telecom continues its transition to a leaner, mobile‑first business, following the merger with Vodafone and peak network investment. The company is delivering solid subscriber growth, especially across its digital‑first and value segments, with around 70,000–80,000 new mobile subscribers forecast for the first half of FY26, led by strong demand for digital brands and MVNOs.
Cost control remains a priority, with TPG targeting $100 million in operating cost savings by FY29. Capex is forecast to decline as major investment projects wind down, with further reductions anticipated from FY27. Management reiterated its intention to maintain an investment grade credit rating while funding future spectrum renewals from strong cash flow and borrowing headroom.
What's next for TPG Telecom?
Looking ahead, TPG Telecom expects EBITDA growth to outpace revenue growth, supported by ongoing cost reductions and a greater customer shift toward digital-first brands. The business is well positioned to benefit from its simplified brand portfolio and improved network capabilities, targeting further market share gains in both consumer and business mobile.
Dividend growth is expected to continue in line with sustainable profit and cash flow growth. The company is also keeping a close eye on regulatory and technological changes, particularly spectrum renewal costs from 2028, and is leveraging digital and artificial intelligence to enhance customer experience and operating efficiency.
TPG Telecom share price snapshot
Over the past 12 months, TPG Telecom shares have declined 23%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 4% over the same period.
