Telefonica stock faces lower revenue target after strong 9M profit

Telefónica reported its third-quarter and nine-month results on Thursday, November 12, 2026, with revenue, profitability and cash generation improving across the continuing business. In its results release, the company said nine-month revenue reached 24.825 billion euros, up 2.8% at real exchange rates and 1.0% at constant exchange rates.

Adjusted EBITDA increased 4.6% at real exchange rates to 8.846 billion euros, which Telefónica described as its strongest increase in a decade. Adjusted operating cash flow after leases rose 6.1% to 4.018 billion euros, while free cash flow from continuing operations advanced 10.7% to 1.963 billion euros.

Profit growth meets portfolio effects

Continuing operations produced net income of 1.333 billion euros in the first nine months, an increase of 21.6% from the prior-year period. The consolidated group reported net income of 464 million euros, compared with a loss of 1.080 billion euros a year earlier, as discontinued operations recorded a net loss of 870 million euros.

The third quarter showed the same operating direction. Revenue rose 4.8% at real exchange rates to 8.433 billion euros, adjusted EBITDA increased 6.2% to 3.078 billion euros and adjusted operating cash flow after leases gained 10.6% to 1.364 billion euros. Free cash flow from continuing operations reached 1.018 billion euros, while continuing operations generated quarterly net income of 860 million euros.

Spain and Brazil were the main operating supports cited by management. Telefónica España lifted quarterly revenue 2.6% to 3.316 billion euros, while Telefónica Brasil increased revenue 15.4% at real exchange rates and adjusted EBITDA 18% in the quarter. The group ended September with 302.1 million accesses, 5% more than a year earlier.

Guidance gains and a revenue cut

Telefónica raised its 2026 adjusted EBITDA growth target to slightly above 2.5%, from a previous range of 1.5% to 2.5%. It also lifted the adjusted operating cash flow after leases target to above 3.5% and increased its free cash flow target to approximately 3.1 billion euros from approximately 3.0 billion euros.

The upgrade was not broad-based. The company introduced a service-revenue growth target of approximately 1.5% and reduced its total-revenue growth range to 1% to 1.5%, from 1.5% to 2.5%. Capital expenditure is still expected to equal about 12% of revenue, while leverage is planned to move toward 2.5 times EBITDAaL by 2028.

Debt reduction provides another support for the equity story. Net financial debt stood at 25.186 billion euros at the end of September, down 10.8% from a year earlier after a 1.6 billion euro reduction during the first nine months. Telefónica also confirmed a cash dividend of 0.15 euros per share for 2026, subject to shareholder approval and payable in June 2027.

Shares trade lower before the close

Telefonica stock traded at 3.41 euros on Lang & Schwarz at 11:33 CET on Thursday, November 12, 2026, 2.57% below the Xetra close of 3.50 euros on Wednesday, November 11. The results improve the operating and cash-flow profile, but the lower revenue target leaves investors with a mixed outlook for the remaining year.

European equity investors can follow broader moves through IBEX 35 market coverage.

For more company-specific developments, see More news and analyses on Telefonica stock.