Catenaa, Tuesday, February 03, 2026-European telecom operators are expected to see modest growth in 2026, with revenue projected to rise 2% and EBITDA by 2.5%, according to ING Credit Research.

Gains will come from new service bundles, selective price increases, and cost reductions driven by automation and network modernization.

Operators are increasingly leveraging AI-backed customer care, copper switch-offs, and network automation to reduce expenses.

Companies such as Telefonica and BT have already implemented transformation programs, showing how automation can support margins.

However, elevated costs from AI deployments, 5G service development, and subscriber acquisition will partially offset efficiency gains.

Competition remains a key challenge, particularly from new fibre and satellite operators, along with over-the-top services like Teams and WhatsApp.

Analysts note that European telcos will need to enhance offerings for small and medium enterprises and prioritize premium services such as higher-speed broadband, low-latency gaming, and network slicing to drive adoption.

Standalone 5G investments are expected to increase, marking a shift from earlier fibre-focused strategies. Price pressures in highly competitive markets such as Italy, Spain, and Belgium may limit ARPU growth.

Some operators, including Altice France, face profitability pressures amid potential asset sales and ongoing debt reduction efforts.

Regulators will play a balancing role as well, particularly in markets where consolidation or joint network ventures are under review.

Analysts suggest that while 2026 holds opportunities for earnings growth, the combination of competition, regulatory oversight, and investment needs will make execution a careful balancing act for European telcos.