UBS cuts Elisa to 'neutral' on mobile services slowdown, risks to growth

Elisa Oyj

06/06/2025 14:14

** UBS downgrades Finnish telecom operator Elisa ELISA.HE to "neutral" from "buy," citing slowdown in mobile services and uncertainties regarding overall growth

** The broker sees fewer levers for mobile revenue expansion, says that Elisa cannot meet its growth targets without an acceleration in mobile

** UBS points out that Elisa's mobile service revenue growth has slowed from around 5% in 2021/2022 to about 4% in 2023 to an underlying about 3% in 2024

** It also notes other key risks to growth such as: increasing churn, decreasing rate of data mobile consumption growth, and more competition in Fiber to the Home (FTTH)

** While the above challenges might collectively still allow Elisa to grow at well above European industry levels, the growth could be slightly below the company's guidance, it says

** UBS expects upgrades to consensus potentially only if and when some of the aforementioned issues improve and mobile service revenue accelerates, currently seeing risk to 2027 guidance by a small margin

** Out of 21 analysts that cover the Elisa stock, eight rate it "buy", nine rate "hold", and four rate "sell"/"strong sell"

 (Reporting by Marta Frąckowiak)

 ((marta.frackowiak@thomsonreuters.com))