Telco earnings set for Q3 lift
KUALA LUMPUR: The telecommunications industry’s core earnings per share (EPS) are expected to improve quarter-on-quarter (QoQ) in the third quarter of 2026 (Q3 2026), according to CIMB Securities Sdn Bhd.
In the third quarter of 2026, telecommunications industry core earnings per share (EPS) are anticipated to rise, according to CIMB Securities Sdn Bhd. This improvement is expected to be driven by favorable seasonality, enhanced mobile monetisation, and strong demand for fibre connectivity. The review of the Mandatory Standard on Access Pricing (MSAP) may commence between September and October and conclude by December 2026 or January 2027.
The Finance Ministry's transfer of shares in Digital Nasional Bhd (DNB) to Maxis Bhd, CelcomDigi Bhd, and YTL Power International Bhd could also be finalized by the end of Q3 2026, providing more clarity on DNB's net loss and telcos' strategies to reduce their impact on profit and loss in the next two to three years.
Most telcos under CIMB Securities' coverage reported Q2 2026 core EPS in line with their forecasts, except for Axiata Group Bhd, which saw a 260% year-on-year increase in first-half 2026 core EPS. This surge was primarily due to strong contributions from XLS, Robi, and Dialog. Time dotCom Bhd and Maxis also performed strongly, with healthy revenue growth and improved EBITDA margins.
CIMB Securities did not alter stock ratings following Q2 2026 results but raised target prices for Time and Telekom Malaysia Bhd (TM) by 2% and 9%, respectively, while reducing Axiata's target price by 10%. The firm also lowered its FY26 to FY28 dividend per share forecasts for Time to 42 to 43 sen. Industry mobile service revenue increased by 0.3% YoY and 0.1% QoQ in Q2 2026, while postpaid revenue grew steadily by 1.8% YoY, and prepaid revenue declined by 1.9% YoY.
However, prepaid revenue decline was better than the previous three to seven% YoY contraction between Q3 2024 and Q3 2025.
Maxis' mobile revenue market share (RMS) grew by 0.2 percentage points QoQ to 43.6% in Q2 2026, while CelcomDigi's RMS decreased to 56.4%. Industry fixed services revenue grew by 7.2% YoY, led by TM, Time, and CelcomDigi. FBB subscriptions grew modestly by 0.7% QoQ and 3.6% YoY, indicating a maturing market with stabilising price competition.
Written by urgent.news from New Straits Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
