Telefónica’s CEO targets global tech role for Europe

• Telefónica’s CEO Marc Murta is on a mission to position the telco at the heart of Europe’s digital ambitions
• He believes Europe can match the US and China as a technology powerhouse
• But there’s a long way to go before such targets can even come into realistic focus

Telefónica has achieved its 2025 goals, is tackling legacy issues that need to be fixed, is embracing risk, and is determined to help put Europe on an equal competitive footing with the US and China, the telco’s chairman and CEO Marc Murta told investors at the company’s annual general meeting (AGM) of shareholders on 26 March.

Murta, who has been in the hot seat for almost 15 months, spent most of 2025 getting to grips with the current state of the Telefónica empire and devising the operator’s new five-year strategy, Transform & Grow, which was unveiled last November. The new plan made it clear that Telefónica is focused primarily on strengthening its four key markets: Spain; Germany; the UK, where the company is active through Virgin Media O2 (VMO2), its joint venture with Liberty Global, and Nexfibre, the wholesale fibre access network operator that is closely aligned with VMO2 and in which Telefónica holds a 25% stake; and Brazil (Vivo). At the same time, the operator is exiting the rest of the Latin American markets where it has been active – in the past year it has sold its operations in Peru, Uruguay, Ecuador, Colombia and Chile. 

So the transformation is underway, but achieving organic growth will be tough. The size of Murta’s task was made apparent a month ago when the telco reported its 2025 full year results, which were less than spectacular – group revenues increased by just 1.5% and adjusted EBITDA by 2%. For 2026, the company has forecast year-on-year revenue growth of 1.5% to 2.5% and adjusted EBITDA growth of 1.5% to 2.5%.

But, as you’d expect, Murta is putting on a brave face. He told the AGM that the Telefónica team is “building a stronger, more efficient, more profitable, more disciplined company, better prepared to compete globally… Spain, Europe and the world are undergoing a profound transformation. Telefónica wants to make a decisive contribution to that change. Telefónica has met its 2025 targets. The transformation is already underway.” 

Murta’s passion has yet to stir investors, though. Telefónica’s share price didn’t move much during or after the AGM and, at €3.66 on the Madrid stock exchange, it is 15.6% lower than it was a year ago. 

So how can Murta and his team reverse that decline? By becoming more of a regional powerhouse, innovating, taking risks not normally associated with large telcos, and developing new services, it seems.  

“We are living through a period of unprecedented geopolitical and technological transformation. At Telefónica, we want to be at the forefront of this transformation,” stated the CEO, who noted that the company has an “advanced and robust infrastructure… with a human capital of immense value.” 

But it also has numerous ingrained issues that need to be fixed, such as “organisational complexity, slow execution, limited financial flexibility, structural cost pressures and an aversion to making difficult decisions,” stated Murta, who is determined to overcome those challenges and take tough decisions. “Transformation demands clarity. And clarity means making decisions. We decided to simplify. We decided to focus. We decided to strengthen the balance sheet. And to take calculated risks. Because transformation does not arise from comfort. It arises from determination and execution. Transformation requires taking risks and knowing how to identify when to take them with rigour.”

Some decisions have already been taken. 

There has been notable recent action in the UK, where Telefónica opened an office in London in early February so it can be “closer” to UK market developments and ensure the Virgin Media O2 team is “aligned” with Telefónica’s new strategy. Then, just a few weeks later, Nexfibre announced the £2bn acquisition of major UK fibre altnet Netomnia. 

That move is an example of how Murta is aiming to strengthen Telefónica through industry consolidation that will add scale and strengthen the telco’s position in Europe. “Europe needs strong operators, with investment capacity, sufficient scale and strategic vision,” noted the CEO, who is very keen on banging the sovereignty drum. “In the increasingly unstable geopolitical landscape in which we live, we firmly advocate the consolidation of the sector in Europe as a necessary condition for creating European technological sovereignty. The fragmentation of the European market limits scale, reduces investment and hinders innovation. The tech world is not a two-horse race but a three-horse race. It is not just China and the United States; it is also Europe – Telefónica wants to be part of this European response.” 

Murta also wants Telefónica to be more innovative and competitive, and here also the company has an example of what it is trying to achieve with the development of a “sovereign cloud with artificial intelligence capabilities and low-latency processing, including a pioneering deployment of 17 edge nodes in Spain” – see Telefónica ramps up its edge datacentre rollout in Spain.

The operator’s edge ambitions aren’t restricted to its domestic market: It is leading a consortium of more than 70 European companies, including other telcos, that has teamed up with the European Commission to unveil EURO-3C, which is described as “the first pan-European sovereign infrastructure, integrating telco, edge, cloud and AI capabilities under a federated, open and secure model”.  It has also hooked up with four of those European telcos – Deutsche Telekom, Orange, Telecom Italia and Vodafone – to federate their edge environments in a joint effort they are calling the European Edge Continuum. 

Murta’s task now is to more firmly establish Telefónica at the heart of Europe’s efforts to achieve digital sovereignty, something that other major telcos, such as Deutsche Telekom and Orange, are also keen to achieve – see CEOs of DT and Orange issue digital sovereignty call to action.

But he’ll have to turn the heads and hearts of a lot of decision-makers, especially those at the heart of the European Commission, if Telefónica is to achieve the domestic and regional consolidation goals that would give it the greater scale and regional sovereign clout the CEO is aiming for. 

In the meantime, he’s pressing ahead with positioning the Spanish telco giant as a lynchpin of Europe’s ambitions. “Telefónica is a company that manages critical technology, but we are also a strategic asset for Spain and for Europe. We are an economic driver, we foster social cohesion, and we provide critical infrastructure,” he told the AGM. “We are a company committed to more than just business. We assert our role as a driving force behind the Spanish economy and European technological sovereignty,” he stated.

- Ray Le Maistre, Editorial Director, TelecomTV