Eltel Q4'25 preview: Powering margins through the telecom chill

Eltel will publish its Q4’25 report on Friday, February 13, 2026, and the earnings presentation can be followed here at 10:00 CET. We expect the report to highlight continued margin resilience despite a mixed demand environment across different geographies. While the traditional telecommunication market remains soft, particularly in Norway and the Finnish fiber-to-the-home (FTTH) segment, we anticipate that growth in the Power segment and public infrastructure projects will support the top line. A key focus for the quarter will be the seasonal peak in cash flow, the sustainability of Norway's return to profitability, and order intake.

Revenue growth supported by Power and public infrastructure

We forecast Eltel’s Q4 revenue to be 230 MEUR, representing a year-on-year growth of approximately 2%. On a country-unit level, we expect Sweden to be the largest contributor to growth (4.5% y/y), steady performance supported by public infrastructure projects and solar PV. In Finland, we expect a 2% top-line growth, driven by continued strong momentum in the Power segment, especially within solar PV and data center projects, thereby partially offsetting the continued softness in Communication and Fiber-to-the-home FTTH. Furthermore, we expect the Denmark & Germany unit to benefit from growth in battery energy storage systems (BESS) and smart grid operations but anticipate that weaker volumes within Communication will hold back growth (Inderes estimate: 1% y/y). We also estimate Norway to remain a point of uncertainty. Although we expect the negative revenue trend to begin moderating due to easier comparables, the traditional telecom market in Norway is anticipated to have remained soft with low investment levels (Inderes est: -5% y/y). Additionally, we note that FX changes could provide tailwinds to reported growth within the Swedish country-unit following the year-on-year appreciation of the Swedish krona against the euro.

Margin resilience and seasonal cash flow peak in focus

We estimate an adjusted EBIT of 8.4 MEUR for the fourth quarter, corresponding to a margin of 3.6% (Q4’24: 5.6 MEUR, 2.5%). Profitability is expected to be supported by the company’s ongoing focus on commercial excellence, including stricter pricing discipline and the continued flow-through of improved contract terms, as well as an increasing share of new, higher-margin, business. A key factor for the Group's Q4 result will be the performance of the Norwegian unit, which successfully returned to black figures in Q3’25 with a 1.7% margin. Sustaining this profitability in Norway despite lower volumes remains critical for the overall turnaround story in our view. Furthermore, Q4 is seasonally the strongest quarter for cash flow as working capital is typically released when construction volumes slow down for the winter. After high working capital tie-ups earlier in the year, we expect a strong cash flow performance in Q4, which is also necessary to support the company's deleveraging targets.

Market outlook and margin trajectory remain areas of interest

Since Eltel does not issue numerical Group guidance, our attention remains on qualitative signals regarding the market outlook across its country units. While structural drivers, such as electrification and digitalization, support long-term demand in the Power segment, the near-term outlook for Communication remains clouded by the completion of major fiber rollouts in the Nordics. We will be looking for signs of a bottoming out in the Norwegian telecom market and monitoring the pace of expansion into "new" business areas like data centers, solar PV, and EV charging, which generally carry higher margin potential.

The company’s medium-term financial target of an EBITA margin exceeding 5% remains a key benchmark. While we expect gradual margin expansion toward 3.2% in 2026, reaching the 5% level will likely require further operational efficiency gains and a more significant shift in the business mix toward higher-margin growth segments. Additionally, we will monitor the leverage ratio (net debt/adj. EBITDA), which we expect to decrease over time as profitability improves and cash flow strengthens.