Key Highlights

• It also serves home broadband customers, largely over the National Broadband Network (NBN), and retains a fixed-line presence after its 2025 divestment.

• At 30 June 2026 TPG reported 5.81 million mobile subscribers, with 64,000 net additions in the half compared with 100,000 a year earlier.

• Digital First reached 781,000 customers and MVNO customers 214,000.

• Home broadband subscribers fell by 42,000 to 1.94 million, which the company linked to NBN competition.

What do TPG Telecom's (ASX:TPG) first-half results say about a company that has been reshaping itself? In short, they show a Business that is growing mobile, cutting Investment and generating more cash on a like-for-like basis, while headline profit remains small and the fixed-line side keeps shrinking. The half-year to 30 June 2026 was reported on 21 August 2026, and the details matter because reported and pro forma figures tell somewhat different stories.

What TPG does

TPG Telecom is one of Australia's three mobile network operators, alongside Telstra and Optus. It sells mobile services under brands including Vodafone and a set of lower-cost "Digital First" labels, and it also supplies wholesale mobile customers (MVNOs). It also serves home broadband customers, largely over the National Broadband Network (NBN), and retains a fixed-line presence after its 2025 divestment.

Mobile is the main growth engine. At 30 June 2026 TPG reported 5.81 million mobile subscribers, with 64,000 net additions in the half compared with 100,000 a year earlier. Digital First reached 781,000 customers and MVNO customers 214,000. Home broadband subscribers fell by 42,000 to 1.94 million, which the company linked to NBN competition.

The first-half numbers

All figures are in Australian dollars and come from the company's ASX filing. Service Revenue was $2,071 million, up 0.5% on the prior period's $2,060 million, with mobile growth partly offset by lower fixed revenue. Total revenue was $2,425 million, down 1%.

EBITDA was $821 million, up 1.0% from $813 million. On the company's non-statutory pro forma basis, which adjusts for the 2025 sale of fibre assets, EBITDA rose 4.7% against a pro forma $784 million. Net profit after tax from continuing operations was $35 million, up 9.4% from $32 million. Statutory profit attributable to owners fell 43% from $61 million, because the earlier period included $29 million from discontinued operations.

Earnings per share were 1.8 cents, against 1.7 cents. Underlying Earnings Per Share were 3.6 cents, against 3.7 cents. Those figures illustrate how modest earnings remain relative to the size of the asset base, a consequence of heavy Depreciation and Amortisation on network and spectrum investment.

Cash flow and the balance sheet

Operating free Cash Flow was $199 million. That was down 34.8% on a reported basis, but up 16.4% on a pro forma basis from $171 million. Free cash flow to Equity was $93 million, compared with $119 million. Cash Capital Expenditure excluding spectrum fell 8.9% to $431 million.

Net borrowings were $1,380 million, up $91 million since 31 December 2025, which the company attributed mainly to capital expenditure being weighted towards the first half. Net Debt excluding leases was 0.8 times EBITDA, against a bank covenant limit of 3.75 times. Gross Lease liabilities were a further $2,747 million, which sits outside that ratio. During the half, the company cancelled $400 million of committed debt facilities.

Dividend, guidance and strategy

The board declared an interim Dividend of 10.0 cents per share, up 1.0 cent, franked at 25%. The Record Date was 28 August 2026 and payment was due on 29 September 2026. The stated policy is to increase dividends over time in line with sustainable growth in profit and cash flow.

FY26 guidance was unchanged. EBITDA is expected between $1,665 million and $1,735 million, excluding material one-offs, and capital expenditure on an additions basis is expected at about $750 million. Guidance assumes no material change in operating conditions. These are management expectations rather than reported outcomes, and they can change.

Management says peak investment years have passed and that lower capital spending should support cash flow growth. It also cites the multi-brand approach, network sharing, business simplification and a return to growth in fixed wireless in the second quarter of FY26, helped by standalone 5G services. It points to the $2.7 billion bank debt repayment in late 2025 as having reduced borrowing costs.

Background: the Vocus transaction

The half cannot be understood without the sale of TPG's fibre network infrastructure and enterprise, government and wholesale (EGW) fixed business to Vocus Group, completed on 31 July 2025. TPG then entered a transmission and wholesale fibre access agreement with Vocus in August 2025. The sale simplified the group, but it also changed the earnings base, which is why pro forma comparisons feature so prominently in the results.

Competitive position

Australian mobile is dominated by three network operators, and TPG competes with Telstra and Optus. Its strategy leans on lower-cost brands, wholesale partners and network sharing. Mobile service revenue grew 3.1% in the half, yet net additions slowed, which suggests that competition for customers remains intense.

Home broadband is a tougher environment. Competition around the NBN is intense, and TPG's subscriber losses show the pressure. Fixed wireless is a potential offset, though a single half of recovery is a thin basis for assuming a lasting trend.

Risks and what to watch

The key risks are visible in the numbers. Net mobile additions were lower than a year earlier, broadband losses continue, and earnings per share remain small. Pro forma measures can flatter underlying trends if the adjustments prove unrepresentative. Capital expenditure timing could also affect cash flow, and the Interim Dividend is only 25% franked.

Upcoming reference points include the full-year FY26 result, due after the December year end, and whether EBITDA lands inside the guided range. Investors will also watch mobile subscriber trends, fixed-wireless momentum and the pace of lower capital spending turning into free cash flow.

For now, the evidence supports a measured reading: a business with improving cash generation and a conservative debt position, but with modest profits and a competitive market that offers little room for error.