CEO letter - Q1 2026

From a geopolitical perspective, the first quarter of 2026 has been both dramatic and turbulent. There is every reason to expect that the rest of the year will continue to be shaped by uncertainty, that may possibly impact customer sentiment and component prices.

Tele2 is relatively shielded from many of the more extreme swings caused by ongoing geopolitical tensions, and for many investors we represent a safe haven in uncertain times. When we initiated our transformation last year, we said that we wanted to strengthen our resilience and to remain in control of our own destiny. With a reduced cost base, increased flexibility and a simplified organisation and product portfolio, we are now much better equipped to handle external events without having to react out of urgency.

That is the foundation we are now building on in 2026, and it is reflected in our solid first-quarter results. We continue to apply strict discipline and constant optimisation of our organisation – in terms of size, focus and capabilities – while investing in customer experience. Compared to Q1 last year, we organically grow our end-user service revenue by 3%, our underlying EBITDAaL by 11% and deliver an equity free cash flow of SEK 2.2 billion in the quarter.

During the first quarter, we made significant progress in our ability to offer the right product at the right time through the right channel. This has been driven by what might seem like two extremes: physical retail and AI.

While continuously improving the usability and the attractiveness of our online stores, we opened five new stores in Sweden during the quarter, enabling us to improve service, deepen relationships and address growth potential. As with last year’s store openings, the new stores have proven both commercially successful and highly appreciated by new and existing customers. We plan to expand the network further with three additional stores in the second quarter.

While the expansion of our physical presence is visible to customers, many of the improvements in customer experience driven by AI and automation happen behind the scenes. During the quarter, we made substantial progress in automating processes and our ability to anticipate and resolve technical issues remotely – often before they are even noticed by the customer. This reduces frustration and eases pressure on customer service. At the same time, we have significantly strengthened our analytical capabilities and our understanding of customer needs. AI is evolving rapidly, and we are moving fast to capture the opportunities it creates for us.

Our B2B business has had a very strong start to the year, maintaining the excellent momentum from last year. Thanks to the major transformation carried out last year, we manage to keep our focus in a highly competitive market. Tele2 IoT continues to deliver particularly strong growth and is increasingly establishing itself as a global player. Its focus on innovation and on enabling customers’ businesses is attracting growing interest from some of the world’s leading brands, including the automotive industry.

Our Baltic operations also started the year strongly with solid profitability growth, surpassing last year’s spectacular performance. At the same time, a spectrum auction has already been announced and will take place in Lithuania in 2026. At the end of February, we concluded the sale of our Baltic tower assets, which translated into SEK 4.7 billion cash proceeds for Tele2. This is an important strategic transaction, and we are optimistic about the potential of this first pan-Baltic tower company, which started to impact our P&L as of March.

Another key development during the quarter is the Swedish Post and Telecom Authority’s (PTS) proposal to regulate the villa fibre market. PTS has done thorough and commendable work in developing a framework aimed at increasing consumer choice and reducing the risk of local fibre monopolies limiting competition. We are optimistic that the process will move faster from here, which would be very positive news for Swedish homeowners. In the meantime, we have upgraded our own coax network, now offering record speeds up to 2.5 Gbps in cities like Stockholm, Gothenburg, Malmö, Lund, Norrköping and Sundsvall.

Finally, I would like to highlight our proactive support for the government’s new proposal to block websites that facilitate sexual exploitation of children. Sustainability remains high on our agenda, and protecting children online is a cornerstone of our strategy. Last year alone, we blocked over seven million attempts to access child abuse material – a staggering number that attracted significant media attention in January and strong engagement from our customers and their families. Addressing this issue requires collaboration across many stakeholders, but we remain firmly committed to playing our part – and even more.