OECD study: investment and profit margins in telecoms sector are stable

The OECD has analysed the financial performance of 179 telecoms operators (including all of those with a market capitalisation of over $1 billion) and from this gleaned some interesting stats:

  • Dataset – 179 operators from 55 countries, market capitalisation of USD3 trillion, employ 5.1 million people
  • Profit margins are stable
  • Investment is strongly linked to sales and is in the range 15-17% of sales. The more revenues increase, the more investment increases. The average capex over the last 15 years has been 15.5%
  • Incumbents are maintaining a strong position – they invest more and deliver higher EBIT margins and ROIC levels
  • Total revenue for the operators studied was USD1.94 trillion in 2017, up 3.2% from USD1.88 trillion in 2016
  • EBITDA was 30.9% in 2017, compared to 30.5% in 2016 (up 0.4%). However it is still lower than it was in 2007
  • Cable & satellite operators have consistently delivered higher EBIT margins compared to telecoms firms between 2010 and 2016, however they were aligned in 2017.