Despite a drop in profits, the group maintains its confidence in being on the right path.
BT Group Q1 Results: Profit Drops Amidst Challenges, Broadband Expansion Continues
BT Group, the UK's leading telecommunications company, has released its Q1 results for the quarter ended June 30, 2025. The report shows a 10% drop in profit before tax and a 3% decline in adjusted revenue, primarily due to several factors.
The increase in net finance costs and higher depreciation and amortisation expenses significantly impacted the profit before tax figures. Additionally, weaker handset sales in the Consumer division and persistent challenges in international trading offset the positive effects of growth in fibre-to-the-premises (FTTP) under Openreach and recent price increases.
Division-wise, the Consumer segment’s revenue fell 3%, Business segment revenue dropped 6%, while Openreach revenue increased 1%. The subdued corporate and public sector spending contributed to the Business segment’s decline.
Despite the overall revenue decline, BT Group has made significant strides in expanding its fibre network. The company connected 7.1m premises, increasing its market-leading take up rate to 37%. Moreover, there was a 46% year-on-year increase in Openreach fibre to the premises net adds, with a total of 566,000. As a result, BT's full fibre broadband now reaches over 19m homes and businesses.
The consumer broadband base of BT Group increased by 11,000, but the average revenue per user decreased by 2%. On the other hand, the postpaid mobile base of BT Group increased by 41,000, with the postpaid mobile average revenue per user remaining broadly flat.
BT Group posted pre-tax profits of £1.3bn in the year to end March, a 12% increase. The reported profit before tax for Q1 2026 was £468m.
In a positive note, BT's 5G network is now available to over 87% of the UK population. The company also announced a final dividend of 5.76p per share in May, bringing its full-year dividend to 8.16p, an increase of 2% on the previous year.
Chief Executive Allison Kirkby attributed the increased profits to "strong cost control and a step-up in focus and transformation". In a separate announcement, Group chief financial officer Simon Lowth announced his retirement from the business. Patricia Cobian, currently finance chief at Virgin Media O2, has been appointed to succeed him and is set to join BT in mid-2026.
However, the report also revealed a decrease in broadband lines due to losses to competitors and a weaker broadband market. Openreach's broadband lines decreased by 169,000.
In conclusion, while BT Group is expanding its fibre network and benefiting somewhat from price increases, these gains were more than offset in Q1 2026 by lower handset sales, tough international markets, and rising financial and depreciation costs, leading to the declines in profit before tax and revenues.
[1] BT Group Q1 Results 2026: Profit Before Tax Drops 10%, Adjusted Revenue Declines 3% - FT.com [3] BT Group Q1 Results 2026: Analysis - The Guardian
- Despite the increase in full fibre broadband coverage and price adjustments, the decline in handset sales, challenges in international trading, higher net finance costs, and increased depreciation expenses contributed to a 10% drop in profit before tax and a 3% decline in adjusted revenue for BT Group.
- Technology advancements in the form of a 5G network available to over 87% of the UK population and the appointment of Patricia Cobian as Group CFO to replace Simon Lowth indicate BT Group's focus on investing in technology and finance to bolster its business operations.
- The challenges faced by BT Group in Q1 2026, such as losses to competitors and a weaker broadband market, have resulted in a decrease in broadband lines, particularly for Openreach, despite the company's efforts in expanding its fibre network.
