The Telstra Group Ltd (ASX: TLS) share price is under the spotlight today after the ASX telco share announced its FY26 result.
Telstra is Australia’s leading telecommunications business, providing mobile, broadband and other telco services. It’s also the owner of significant telco infrastructure.
FY26 result
Here are the highlights for the 12 months to 30 June 2026:
- Total income declined 0.9% to $23.4 billion
- EBITDAaL (EBITDA explained) rose 3% to $8.2 billion
- EBIT grew 1.7% to $4 billion
- Net profit grew 2.7% to $2.4 billion
- Earnings per share (EPS) climbed 5.3% to $0.199
- Cash EPS grew 13.8% to $0.255
- Final dividend per share up 10.5% to $0.105 (90.5% franked)
- Dividend per share hiked by 10.5% to $0.21
- Share buyback of $1 billion announced
What drove these numbers?
Telstra reported that mobile EBITDA was the biggest driver of the FY26 underlying EBITDA.
Mobile income increased 3% to $11.4 billion, with mobile service revenue rising 4.8%.
Mobile handheld users increased 274,000 in FY26, including 39,000 retail and 235,000 wholesale users. There was also a 3.7% rise of the average revenue per user (ARPU) to $45.33, with 8.8% growth for wholesale ad 7.2% for prepaid handheld.
All of the above led mobile EBITDA to increase 3% to $5.4 billion, adding $175 million to underlying EBITDA of Telstra’s total $297 million EBITDA increase.
Fixed (broadband) for customer and small business saw 13.5% growth of underlying EBITDA to $412 million thanks to cost discipline and the fixed wireless offering – that’s broadband powered by Telstra’s mobile network.
Fixed enterprise EBITDA declined 16.7% largely due to ‘data and connectivity’.
International EBITDA declined 3.5% to $654 million due to wholesale and enterprise, reflecting “strategic decisions and refocus initiatives.
InfraCo fixed EBITDA rose 2.9% to $1.8 billion. Growth from demand was partly offset by higher redundancy.
Amplitel EBITDA grew 9% to $391 million.
Other EBITDA improved 47.2% to negative $104 million. Other EBITDA grew because of the bond rate and foreign exchange benefit, equity loss in the prior period and energy generation gains.
Telstra noted that strong cost management supports operating leverage. Underlying operating expenses declined 3% to $14.47 billion, while overall cash EBIT costs declined 2.8% to $18.7 billion.
$1 billion Telstra share buyback
Today, the company announced a further on-market share buyback of up to $1 billon.
The company noted this shifts its capital structure towards more debt and less equity, which is enabled by earnings growth and the strength of the balance sheet.
The Telstra share buyback supports growth of earnings and dividend per share. The rising payout demonstrates the company’s confidence in its financial strength and outlook, according to management.
Outlook for the Telstra share price
The company gave guidance of underlying earnings growth in FY27 as it remains disciplined on costs and capital allocation.
Underlying EBITDAaL is expected to grow to between $8.5 billion to $8.8 billion, up from $8.34 billion in FY26. That implies growth of at least 1.9% and up to 5.5%.
Cash EBIT is expected to grow to between $4.75 billion to $4.95 billion, up from $4.66 billion. That suggests growth of at least 1.9% and up to 6.2%.
Business as usual capital expenditure could be similar as FY26’s $3.36 billion, or rise as much as 8.6%.
Telstra believes that Australia must position itself to drive and participate in the value created by AI and the digital infrastructure boom, “with sovereign capability and assets working in our national interest”.
I think Telstra is one of the best large ASX dividend shares to own for resilient and growing payouts, so I’d consider it as an investment.
