Telenor made important strategic progress in the second quarter, strengthening its Nordic position, expanding its broadband footprint and securing important contracts within defence and mission-critical communications. The financial performance was affected by particularly tough year-on-year comparables, the timing of commercial initiatives, robustification and transformation costs, and a continued challenging macroeconomic environment in Bangladesh.

“2026 is a transition year for Telenor on several fronts as we deliver on our strategy. While the quarter was affected by several short-term factors, we are executing initiatives that will improve efficiency, strengthen customer value and increase returns over time,” says CEO Benedicte Schilbred Fasmer.

Second quarter highlights:

• Service revenues of NOK 14.679 billion.

• Adjusted EBITDA of NOK 7.987 billion.

• Free cash flow before M&A of NOK 1.815 billion.

• Total free cash flow of NOK 2.0 billion.

Service revenues declined by 0.7 per cent, while EBITDA declined by 4.8 per cent, both organically. Free cash flow before M&A was NOK 1.8 billion. The results reflect particularly tough year-on-year comparables, timing of commercial initiatives, phasing and step-up of robustification and transformation costs, softer market conditions in Norway, modest improvements in Finland, and challenging macro conditions in Bangladesh. Telenor also made a provision in Norway for the dispute on VAT for TV news channels, negatively affecting service revenues and adjusted EBITDA by NOK 135 million and NOK 162 million, respectively.

A transition year to deliver on strategy

Telenor is currently supporting dual IT cost structures and high implementation costs related to the IT transformation, which are expected to start rolling off towards year-end and through 2027. These efforts are expected to bring substantial improvements in customer experience and efficiencies over time. From August, Telenor’s new organisational structure will take effect, supporting a more focused portfolio and a leaner operating model. Over time, the changes are expected to create a Telenor with greater flexibility, higher efficiency, improved customer value and increased return on capital.

Nordic markets remain challenging, with signs of improvement

In the Norwegian mobile market, there has been a gradual increase in competition for mobile subscribers, with more promotional activity in recent quarters. Compared with a particularly strong second quarter last year, B2C growth slowed this quarter. At the same time, Telenor grew well in B2B and saw encouraging developments in the Norwegian market last month. In Finland, market conditions remained competitive, while Sweden, Denmark and Amp delivered good financial progress during the quarter.

Security and defence remain a strategic focus

In the Norwegian mobile market, there has been a gradual increase in competition for mobile subscribers, with more promotional activity in recent quarters. Compared with a particularly strong second quarter last year, B2C growth slowed this quarter. At the same time, Telenor grew well in B2B and saw encouraging developments in the Norwegian market last month. In Finland, market conditions remained competitive, while Sweden, Denmark and Amp delivered good financial progress during the quarter.

Building a stronger and more focused Telenor

Telenor also made important progress in strengthening its portfolio and Nordic position during the quarter. The partnership with Verdane with 50/50 ownership in Telenor Connexion unlocks significant value while supporting the next phase of growth in IoT.

In broadband, the approval of the GlobalConnect consumer transaction and the acquisition of Enivest strengthen Telenor’s position in Norway, while the acquisition of Bahnhof expands scale and breadth in the Swedish broadband market. The three broadband transactions are expected to generate sizeable cash flow synergies from 2030.

Telenor remains in a very strong financial position and is well under way with the first year of its three-year share buyback programme, which will reduce share count over time and support growth in earnings and dividends per share.

“Our focus is firmly on execution – improving commercial momentum, delivering transformation benefits and translating this year’s strategic actions and M&A into stronger cash flow and returns over time. Our long-term ambitions remain unchanged, and we remain confident in our strategic direction,” says Schilbred Fasmer.

Financial outlook for 2026:

The outlook for the 2026 is moderated on the back of market conditions in addition a few technical factors.

• Flat to low-single-digit organic growth in Nordic service revenues (changed from low-single-digit).

• Flat to low-single-digit organic growth in adjusted EBITDA in the Nordics (changed from low-to-mid-single-single-digit).

• Around 14% capex to sales, excluding leases, for the Nordic business.

• Flat to slightly negative organic growth in adjusted EBITDA for the Group (changed from flat-to-low-single-digit).

• Free cash flow before M&A excluding dividends from associated companies and incremental spectrum of around NOK 10 billion (changed from NOK 10-11 billion).

Items related to prior years’ periods, including the mentioned TV VAT charge for 2020-2022, remain excluded from the outlook.