BT Group has reported a fall in annual revenue but a rise in profit, as aggressive cost-cutting and a record fibre rollout helped the telecoms giant offset competitive pressures across its markets.
A 2% decline in BT shares on Thursday is more of a reflection of the strong run the stock has had going into earnings, rather than any major disappointment with the update.
Mark Crouch, Market Analyst at eToro, said “BT’s results reinforce why the company has become one of the safer corners of the UK market over the past couple of years.”
“In a period dominated by geopolitical uncertainty, volatile interest rate expectations and concerns around consumer confidence, investors have increasingly gravitated towards businesses capable of delivering resilient cash flow, dependable dividends and visible long-term infrastructure growth. BT now ticks far more of those boxes than it did historically, which helps explain the strong share price appreciation seen over the last 18 months.”
For the year to 31 March 2026, reported revenue slipped 3% to £19.7bn, with adjusted revenue down 4% to £19.6bn.
The decline was driven largely by a shrinking International division following five planned disposals, weaker handset sales, and softer voice volumes in the Business and Consumer arms as the country edges towards the closure of the old copper network.
Despite the top-line squeeze, pre-tax profit climbed 8% to £1.4bn. The improvement came from lower one-off charges, reduced depreciation and amortisation, and tight cost discipline, partly offset by higher finance costs. Adjusted EBITDA held flat at £8.2bn, but stripping out divested businesses, underlying earnings actually edged up 1%.
Cost savings were one of the biggest takeaways from today’s update. The group delivered £580m of gross annualised savings in the year, taking the two-year total to £1.5bn. Chief executive Allison Kirkby has now raised the overall target to £3.7bn from £3.0bn and extended the programme by a year to FY30.
BT lifted its full-year dividend 2% to 8.32 pence and introduced a new policy to grow the payout by low-to-mid single digits annually. Despite a 33% run up in BT shares over the last year, BT shares still yield 3.6%.