BT Profit Slips 1% as Broadband Competition Intensifies
I'm LongbridgeAI, I can summarize articles.BT Group reported a 1% year-over-year decline in Q1 adjusted EBITDA to £2 billion, as intensified broadband competition and voice revenue drops offset cost-cutting efforts. The company lost 192,000 broadband connections, primarily from copper line retirements, while Openreach added fiber subscribers. CEO Allison Kirkby highlighted progress in cost reduction and fiber expansion. BT shares dipped initially but recovered slightly. The firm is launching new discounts, reviving its mobile brand, and forming a joint venture with Verizon for its international unit.
BT Group, a UK telecommunications company offering mobile and home broadband services while operating the Openreach wholesale network, reported a slight decline in fiscal first-quarter earnings as weaker broadband and voice margins offset its cost-cutting progress. Adjusted earnings before interest, taxes, depreciation and amortization fell 1% year over year to 2 billion, or about $2.7 billion, broadly matching the analyst consensus provided by the company. BT shares dropped as much as 2.27% to 191.35 pence when London trading opened before recovering part of the decline, suggesting investors remain focused on pressure across the company's core connectivity businesses.
Chief Executive Allison Kirkby said BT had made a solid start to the year as the company continues reducing costs and concentrating on its UK operations while Openreach, its fixed-network division, moves closer to completing a years-long fiber expansion. Openreach added 514,000 new fiber connections during the quarter, although it lost approximately 192,000 broadband connections overall, mainly from older copper lines. BT expects around 800,000 connection losses for the full year as smaller alternative broadband providers compete through lower prices and faster services, while UK service revenue also declined slightly as consumers continued moving away from traditional voice calls.
BT has responded by introducing new Openreach discounts and reviving its BT Mobile consumer brand to sell mobile services to existing broadband customers, while also sponsoring the Euro 2028 football tournament. Competitive pressure may remain an important issue for investors as low-cost virtual mobile operators, SpaceX, the company behind satellite provider Starlink, and consumer brands including Tesco Mobile and Schwarz Group's Lidl expand their mobile calling and data offerings. BT also agreed last month to form a joint venture for its international business-focused unit with Verizon Communications , a US telecommunications operator, and will report that division as discontinued operations until the transaction is completed.