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Telecom Italia (BIT:TIT) Stock Faces Profit Revival And Rich P E Scrutiny

Simply Wall St · 1d ago

Telecom Italia stock closed at €7.353, roughly flat over the past week after a weaker 30 days, yet the latest quarter gives investors a very different story to work with. The headline is profitability. Q2 net income from ongoing operations swung back into the black at €104m and trailing twelve month earnings from continuing operations reached €509m.

That shift matters more than today’s share price flicker. It plugs directly into a still rich P/E of 55.1x and a balance sheet where interest costs remain a pressure point. The next sections unpack whether this earnings run-rate justifies that valuation strain.

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Q2 2026 Earnings Summary

  • Revenue (Q2 2026 vs. Q2 2025): €3,509m vs. €3,363m (up ~4.3%)
  • Net Income from Ongoing Operations (Q2 2026 vs. Q2 2025): €104m vs. €13m (up very strongly from a low prior base)
  • Basic EPS (Trailing 12 Months to Q2 2026 vs. Trailing 12 Months to Q2 2025): €0.175435 vs. €0.132638 (up ~32.3%)
  • Group Revenue (H1 2026 vs. H1 2025): €6.8b vs. the prior year H1 level (reported H1 up 2.0% and up 3.3% when excluding the mobile virtual network operator (MVNO) transition effect)

Prefer clean charts instead of another wall of Telecom Italia figures and footnotes? Get a full visual view of the company’s valuation picture in the company report for Telecom Italia.

BIT:TIT Trailing 12-Month Earnings & Revenue History as at Jul 2026
BIT:TIT Trailing 12-Month Earnings & Revenue History as at Jul 2026

Telecom Italia earnings lend support to cautious optimism

The latest quarter gives Telecom Italia bulls some real numbers to point to. Group revenue and EBITDA after lease are both moving in a positive direction, with underlying EBITDA after lease growing faster than reported once the MVNO transition is stripped out. Domestic profitability looks healthier, with domestic EBITDA after lease up 7.1% helped by pricing discipline and cost actions. Equity free cash flow of €0.7b in H1, aided by the concession fee collection, and leverage at 1.94x also fit a story of a more stable, infrastructure style profile.

Ongoing pressure points keep Telecom Italia risks in view

The more cautious narrative around Telecom Italia still has support. Group growth is modest and partly flattered by temporary items like the concession fee collection, while the MVNO transition created an €80m revenue and €84m EBITDA after lease headwind in H1. Court rejection of TIM’s request on FiberCop tariffs weakens its position on a key cost item. Equity free cash flow targets and planned shareholder distributions rely on continued execution, and the capital intensive nature of the networks and digital businesses remains a structural constraint.

Review whether Telecom Italia’s cash hungry model and recent tariff setbacks are early signals of deeper structural issues. Explore potential hidden threats in our risk analysis for Telecom Italia which shows 1 important warning sign.

Take Charge Of Your Telecom Italia Research

If Telecom Italia’s return to positive earnings and high P/E has your attention, register for free with Simply Wall St and add it to a Watchlist to track the share price against fair value and watch how the thesis develops. Once you hold the stock, use the Portfolio Command Center to cut through noise and focus on key updates to Telecom Italia’s earnings, cash flow and balance sheet. For a broader view on sentiment and potential catalysts, tap into thousands of investor perspectives through the Community. Spot potential catalysts and risks earlier, and give yourself more tools to stay informed about the market.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.