Zegona Communications (LSE:ZEG) delivered a strong set of second-quarter results, reporting continued momentum in customer additions across both fixed broadband and mobile contracts—despite a 1.5% drop in the share price on the day.
Fixed broadband performance strengthened further, with 17,000 net additions in Q2. This extends the improvement seen over recent periods: 7,000 in Q1, 23,000 in Q4 2025, and 6,000 in Q3 2025. The rebound is especially notable compared to Q1 2025, when the company shed 26,000 subscribers.
Mobile contract growth also accelerated, reaching 54,000 net adds in Q2. That compares with 39,000 in Q1, 26,000 in Q4, and 12,000 in Q3, underscoring a clear commercial recovery supported by falling churn.
Quarterly revenues came in at €895 million, down 1.9% year-on-year but broadly in line with expectations and showing an improvement from the 2.3% decline recorded in Q1. EBITDAaL rose 11% to €349 million—beating forecasts by 5.5%—while margins expanded to 39%, an increase of four percentage points. Capital expenditure fell 4% to €139 million, representing 15.6% of sales versus 15.9% a year earlier.
Operating free cash flow climbed 20% to €210 million, lifting margins to 23%, also up four percentage points. Net debt was largely unchanged at €3.63 billion, with leverage easing to 2.73x from 2.88x in Q1.
In a separate disclosure, Zegona and Telefonica announced the sale of a combined 40% interest in Fiberpass to AXA. Telefonica sold 8% while Zegona divested 32%, resulting in a revised ownership split of 55% for Telefonica, 40% for AXA and 5% for Zegona. The deal values Fiberpass at €1.5 billion, equating to a 12x EV/EBITDA multiple—below the 14.4x applied to PremiumFiber, another fiber platform established by Zegona alongside MasOrange. Fiberpass currently carries no debt, and no dividend recapitalisation is anticipated.
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