Global Telco Market Tracker, 2Q26: Telcos Step Up Capex Without Denting Margins

This report delivers a detailed financial and operational snapshot of 145 telecommunications network operators (telcos) worldwide, tracking performance from 1Q11 through 2Q26. It captures revenue, labor, capex, opex, and profitability data with a focus on the most recent quarter (2Q26).

Key findings from our 2Q26 analysis follow:

Global telco revenues rose 2.5% year-over-year (YoY) in 2Q26 to reach $472.5 billion (B), a fifth consecutive quarterly gain. On an annualized basis, revenues rose 4.5% YoY to $1.89 trillion (T), building on the $1.85T full-year 2025 total. Focusing on the 20 largest telcos, the strongest annualized revenue growth by company came from Vodafone (17.4%), Etisalat (16.4%), America Movil (14.0%), Orange (10.5%), and Deutsche Telekom (9.7%). The weakest performance came from Telefonica (-4.3%), KT (-3.5%), and BT (-1.9%), while Charter (-1.5%), Comcast (-0.6%), KDDI (0.3%), and China Telecom (0.4%) were roughly flat. Consolidation activity including Swisscom-Vodafone Italia and Vodafone-Three UK continued to influence reported growth, though its effect is fading as year-ago comparisons catch up: Swisscom’s single-quarter growth, for instance, normalized to 2.5% in 2Q26 after a 48.5% spike in 4Q25.

Capex re-accelerated in 2Q26, rising 7.2% YoY to $72.9B as spending picked up across most of the largest operators rather than staying concentrated in a few. On an annualized basis, capex rose to $304.5B, back above the $300B threshold for the first time since 4Q24, and the first uptick in capital intensity (to 16.1%) after five straight quarters of decline. The strongest annualized capex growth rates were recorded by Etisalat (37.6%), Vodafone (22.7%), Swisscom (21.4%), Airtel (21.0%), and China Telecom (19.5%). The steepest capex declines came from China Mobile (-16.9%), Reliance Jio (-8.8%), Telefonica (-7.1%), KDDI (-4.2%), and SoftBank (-3.5%). Notably, China Telecom swung from one of 4Q25’s biggest decliners to one of 2Q26’s biggest gainers as AI and cloud infrastructure spending offset cuts to traditional network capex.

Global telco workforce declined 2.1% YoY to 4.29 million employees in 2Q26, as operators continued automation, outsourcing, and country-level exits. Despite lower headcount, annualized labor cost per employee rose to $62.5K, up from $60.0K in 4Q25, amid wage inflation, digital talent competition, and union-driven salary increases across several major markets. More details are available in our separately published “Telco Talent Tracker.

Profitability held steady in 2Q26 even as capex and opex both re-accelerated. Annualized EBIT margins stood at 15.8%, essentially flat with 1Q26 and 4Q25 (16.0%) and still below the 3Q25 peak of 16.4%, despite annualized opex (ex-D&A) growth nearly doubling to 4.2% YoY from 2.3% in 4Q25. Profitability trends diverged sharply across the largest operators: AT&T (+4.3pp to 20.6% helped by a weak year-ago quarter) and Airtel (+3.3pp) recorded the strongest annualized EBIT-margin expansion through 2Q26 vs. same period in the prior year, followed by BT (+1.7pp) and KT (+1.4pp). In contrast, Telefonica’s margin contracted 4.3pp to just 2.4%, dragged down by a large negative EBIT quarter in late 2025, while Deutsche Telekom (-3.7pp) and Vodafone (-2.9pp) also saw declines.

Three key country markets are moving in different directions. US capex is rising on home fiber builds, even as revenue stalls. China’s capex rose in 2Q26, but all three operators plan to spend less in 2026 operators as they are moving about a third of it into data centers under Beijing’s “East Data, West Computing” push. India’s capex decline has ended now that the bulk of BSNL’s 4G build is behind it, with Vodafone Idea’s 5G expansion and BSNL’s planned 5G launch the next factors to watch. Regionally, Asia and the Americas are now almost level on revenue (36.3% vs. 36.2% of the global total).