BT hit its FY25 guidance of a modest revenue decline coupled with modest EBITDA growth, and expects more of the same in FY26.

The highlight of the results was consumer broadband returning to subscriber growth despite the altnet onslaught; the lowlight was an increasing decline in Openreach broadband subscribers thanks to other Openreach customers (e.g. TalkTalk) not doing so well.

BT’s longer-term outlook and prospects for a dramatic cashflow turnaround remain strong, with Openreach net losses much more likely to improve than worsen over the next year, and further steps taken to divest/isolate erratic non-UK business segments.
 

Germany suffered a sizeable EBITDA decline in the 2H of FY25, and guidance for European EBITDA next year implies another tough year in FY26 with an underlying 5% decline for Europe as a whole excluding 1&1.

Elsewhere, the UK had a very solid FY25 and is a good news story for the Group with the merger with Three in prospect, but the Rest of World’s contribution is likely to diminish from here.

Various one-offs will support the outlook for next year, but operational execution is at the core of Vodafone’s raison d’être. Beyond some encouraging KPIs, investors continue to await meaningful evidence of such.

Gerry Cardinale of RedBird Capital is poised to take the reins of the Telegraph Media Group (TMG) after two years of unforeseen events that led to an unfortunate limbo at TMG.

We anticipate Gerry Cardinale will be vetted under the “public interest” regime for newspapers, which should be a smooth process and conclude by September 2025.

The saga of TMG provoked a new regime for foreign state-owned investors that is a new constraint on all media mergers.

Advertising has outgrown the UK's wider economy by 20 percentage points since 2000 thanks to online and advertisers in export markets, especially China, targeting sales in the import-dependent UK market.

If current trends held to 2030, advertising would reach 1.7% of UK GDP, over 50% higher than 2019—we believe this to be the least likely scenario as the UK already sustains higher ad intensity than major markets.

The next recession could be the moment when online ads growth corrects and then reverts to low single-digit growth in line with the economy. A 'soft landing' is also possible, while a surprise outperformance would require more drastic structural shifts.

2024 was a stabilising year after a troubling 2023— Channel 4's revenue was up 1% and it ended the year with a much smaller deficit, although aided by a drop in both overall and original content spend.

Facing slightly uncertain conditions, the broadcaster continues to be over-exposed to the advertising market —91% of revenues—meaning its thoughtful move into production and acquisition is necessary and should be supported.

Channel 4’s presence in streaming continues to grow but struggles to mask the continued drop of 16-34 viewing share. Online success owed much to the increasing influence of foreign library content—this commanded increased spend in 2024.

US tariffs and regulations are sparing no one in 2025—Microsoft, the ‘winner’ of the earnings quarter, is still making plans to protect its European business in a doomsday scenario.

Hyperscalers who have piled their eggs into cloud cannot afford a misstep—this is driving record capex to satisfy cloud demand. We expect to see lumpiness in Q2-Q3, feeding investors’ worries.

Revenue impacts have been felt first at US retail, softening ad demand, with the UK relatively protected for now. Despite relief at the 90-day ‘reset’ with China, economic and political uncertainty remains the story of the year.

The slowdown in telecoms traffic volume growth post-pandemic has persisted for far longer than a simple hangover effect would imply, and has spread from fixed broadband to mobile in many markets

The eventual emergence of the metaverse and/or AI-generated traffic may mitigate this trend, but it is hard to see growth ever returning to a sustained 30%+ per annum level, with around 10-15% likely to prove the new normal

While far from disastrous for telcos, it does have important implications, such as the need to structure pricing more carefully, focus on network quality over capacity, and be more wary of the threat (or opportunity) from MVNOs, FWA and satellite

ITV's total external revenue rose 4% year-on-year in Q1 (to £756 million), although a material drop in internal Studios sales (down by £41 million) meant a decline in total group revenue (-1% to £875 million). Ad revenue was down 2% and will face tough men's Euros comparisons for the next two quarters 

Even with continuing online growth, ITV's overall viewing continues to decline. However, ITVX usage is displaying favourable characteristics that could foretell greater resilience and volume

Further, although the levels of viewing on the ad-tiers of the major SVOD services is analogous to ITVX, the difference in how well that viewing is monetised is stark

VMO2 reported solid financials in Q1, with revenue and EBITDA growth both improving and both (just) ahead of full year guidance.

Subscriber momentum however was poor across fixed and mobile, despite customer service improving, with broadband in particular likely to get worse as network buildout slows.

Meeting full year guidance is still achievable, but will likely require a significant altnet slowdown sooner rather than later in the year.

Two-year-old Temu is mounting a serious challenge to Amazon's 20-year-old Prime value proposition. Temu's extreme low prices at the cost of speed threaten to erode consumer perceptions of Prime's value and convenience.

US tariffs and de minimis changes make the UK more attractive as a destination. Greater competition for sales and advertising will continue in the near term as the platforms adjust.

Temu and Amazon spent billions on ads in the UK in 2024 in the battle for buyers and sellers. Smaller brands and retailers may need to boost brand advertising to fend off the platforms.