Telia beats forecasts, sees stabilising Nordic markets (updated)
UPDATE 1-Telia beats forecasts, sees stabilising Nordic markets Rewrites the story, adds details from conference call in paragraphs 4, 5-7
July 17 (Reuters) - Swedish telecom operator Telia on Friday reported second-quarter core earnings that beat market expectations, helped by solid service revenue growth, continued cost reductions and strong demand for its secure connectivity services.
Adjusted EBITDA rose to 8.38 billion Swedish crowns ($866.95 million) from 7.97 billion a year earlier, compared with analysts' average forecast of 8.34 billion.
Service revenue grew 2.8%, highest level in four years, driven mainly by strong performance in Sweden, Norway and the Baltics, while Finland returned to modest growth amid customer wins and cost improvements.
Conditions in Finland had stabilised after several difficult quarters, helped by lower churn, a higher share of fixed-term contracts and improved execution, CEO Patrik Hofbauer said in a conference call.
The company results come a day after Nordic peer Telenor cut its 2026 outlook following a weaker-than-expected second quarter, citing slower revenue growth in Norway and Finland.
Asked about Telenor's comments on increasing competition in Norway, Hofbauer said Telia had not observed a significant change in market conditions and viewed competition as broadly similar to recent quarters.
Executives added they still see pricing power in Sweden, particularly in mobile and television services, and pointed to additional growth opportunities from its acquisition of broadband customers through the Bredband2 transaction .
Telia reiterated its full-year outlook, with CFO Eric Hageman saying management had "full confidence" in its expectation that EBITDA growth would accelerate in the fourth quarter after a softer third quarter due to project timing effects.
Telia's profitability has improved in recent quarters as savings from its 2024 restructuring programme helped lift margins and support earnings growth.
($1 = 9.6661 Swedish crowns)
(Reporting by Agnieszka Olenska; Editing by Matt Scuffham)