BT returns to capital spending for full-fibre expansion

In May 2024, BT reported a financial year of flat revenues and a significant fall in profits, but generated enthusiasm in stock markets by announcing that it had reached a peak for its significant investments in full-fibre broadband – but now, having published its current end-of-year results, the comms giant has turned the capital spending taps back on and given the green light to its Openreach broadband provision to dig further and faster.

Based on what it deems a successful infrastructure build to date, and the maintenance of a pro-investment regulatory and public policy framework from UK communications regulator Ofcom and the UK government, BT has decided to fund additional capital spending. The investment will be made partly through efficiencies and some reprofiling of other spending.

Just 12 months ago, BT Group chief executive Allison Kirkby stated that the company had reached an inflection point in its long-term strategy, having passed peak capital expenditure on its full-fibre broadband roll-out and achieved a £3bn cost and service transformation programme a year ahead of schedule. Now, she believes BT’s full-fibre deployment is a “UK infrastructure success story” and that it makes sense for the company, and the UK in general, to “push on the accelerator pedal”.

“The more full-fibre we build, the more customers choose to connect. In a highly competitive market, and despite a challenging economic landscape, Openreach is building and connecting customers faster and at a lower cost than anyone,” she said.

BT’s fiscal results for the year to 31 March 2025 showed that Openreach has already built the new infrastructure to more than 18 million homes and businesses nationwide. This included more than four million in the past 12 months and 4.9 million premises in rural locations, a key recent target area for development.

BT Group now expects to accelerate towards its target of reaching 25 million premises by December 2026, upping its build rate by 20% to up to five million premises passed in the year to March 2026.

“The momentum in, and impact of, our full-fibre programme is such that we are now raising our build target by 20% to up to five million UK premises in FY26, keeping us comfortably on track to reach 25 million by the end of 2026, while maintaining our cash flow guidance,” Kirkby added. “We are now only one year away from our inflection to £2bn of normalised free cash flow, our target for FY27, and remain on track to deliver £3bn by the end of the decade.”

As it announced the results, Openreach noted that thanks to increased investment from BT Group, it was now committed to building the country’s most reliable broadband technology – full-fibre – even faster.

With 6.8 million customers already connected to the network – 37% of the total footprint – Openreach claims to have seen record demand for its network in the past 12 months. In 2024, it connected 1.8 million customers to full-fibre. It said it was now reporting quarterly net additions for full-fibre above the half-million mark for the first time.

Based on the assumption of a “supportive” economic environment, Openreach said it ultimately expects to make full-fibre available to as many as 30 million premises in the UK by 2030.

The BT Group results also showed that total reported and adjusted revenue for the year reached £20.4bn, down 2% on an annual basis, attributed mainly to “continued challenging trading conditions” in global and non-UK portfolio channels and weaker handset trading in the consumer division offsetting the benefit of fibre-to-the-premises growth at Openreach.

Reported profit before tax was £1.3bn, up 12% compared with the previous fiscal year, said to be primarily due to goodwill impairment in the prior year, offset by higher specific costs and net finance expense. Capital expenditure was £4.9bn, broadly in line with the prior year.