Telecom Italia Proposes €400M Buyback as Full-Year Revenue and Profitability Improve

Telecom Italia unveiled a €400 million share buyback plan alongside full-year results showing revenue of €13.7 billion and EBITDA after lease of €3.7 billion, up 6.5% year-over-year. The board also put forward a 1-for-10 reverse stock split for shareholder approval and approved 2026 guidance projecting 2-3% revenue growth and 5-6% EBITDA after lease growth from 2025 levels. Capital expenditure is forecast to remain below 14% of revenues in 2026, and roughly half of expected proceeds from the planned sale of Sparkle are earmarked for shareholder buybacks.

Key Points

Telecom Italia reported full-year revenues of €13.7 billion and EBITDA after lease of €3.7 billion, a 6.5% year-over-year increase in EBITDA after lease.
The board has proposed a €400 million buyback linked to the planned sale of Sparkle, and plans to return approximately 50% of expected Sparkle proceeds to shareholders via buybacks.
Management approved the 2026 budget and guided for group revenue growth of 2-3% and group EBITDA after lease growth of 5-6% from 2025, with capital expenditure forecast to remain below 14% of revenues.

Telecom Italia announced on Tuesday a corporate capital return plan and published full-year numbers that show both higher revenues and improved profitability. The company said it will carry out a €400 million share buyback, which the board links to the planned disposal of its subsidiary Sparkle.

For the full year, group revenues amounted to €13.7 billion. Telecom Italia reported EBITDA after lease of €3.7 billion, representing a 6.5% increase compared with the prior year. The board additionally proposed a reverse stock split at a ratio of 1 new ordinary share for every 10 existing ordinary shares, a measure that will proceed only if approved by shareholders.

2026 budget and guidance

The company approved its 2026 budget and issued guidance for the year. Management projects group revenues to rise between 2% and 3% from the €13.7 billion recorded in 2025. Group EBITDA after lease is expected to grow between 5% and 6% from the €3.7 billion reported in 2025. Capital expenditure is forecast to remain below 14% of revenues in 2026.

Shareholder remuneration and Sparkle

Telecom Italia said it plans to return approximately 50% of the expected proceeds from the sale of Sparkle to shareholders through buybacks. The announced €400 million buyback embodies this approach to shareholder remuneration and is explicitly tied to the Sparkle transaction.

Context and investor considerations

The measures announced combine direct shareholder returns with capital-structure adjustments. The reverse stock split will require shareholder approval, and the timing and scale of cash returns are linked to proceeds expected from the Sparkle sale. Management also set a capex expectation relative to revenue for 2026, with no further operational detail provided in the company's statement.

Telecom Italia's published figures and the board's proposals together outline the company's near-term financial framework: modest top-line and EBITDA expansion guidance for 2026, a buyback financed in part by divestment proceeds, and a capital expenditure profile expressed as a share of revenues.

Risks

The proposed reverse stock split is subject to shareholder approval, introducing uncertainty about whether that capital-structure change will be implemented.
Buyback plans are tied to expected proceeds from the sale of Sparkle; the timing and amount available for shareholder returns depend on realization of those proceeds.
Capital expenditure is forecast to remain below 14% of revenues in 2026, but the company provided no further detail on the exact capex level or how it will be allocated.

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