Capital Intensity to Reach 14 percent by 2027
REDWOOD CITY, Calif., April 10, 2025 -- According to a recently published report from Dell'Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, telecom operators scaled back wireless and wireline investments in 2024. The high-level relationship between carrier revenues, capex, and telecom equipment was mostly stable, as both telecom capex and telecom equipment revenues tanked in 2024. Preliminary findings show that worldwide telecom capex, the sum of wireless and wireline/other telecom carrier investments, declined 8 percent in 2024 (telecom equipment manufacturing revenues for the six programs tracked at the Dell'Oro Group declined 11 percent over the same period).
"With some of the larger fiber and 5G builds now in the past, the different risk profiles across the carrier spectrum become more pronounced," said Stefan Pongratz, Vice President of RAN and Telecom Capex research at Dell'Oro Group. "While some operators prefer a more growth-oriented approach and consider elevated capital intensity levels as essential to gain a competitive edge and be better prepared for the next technology transition, the majority of the operators believe the pie is mostly fixed and focusing on efficiency improvements is considered less risky to this group," continued Pongratz.
Additional highlights from the April 2025 Telecom Capex report:
- Investment conditions are expected to stabilize in 2025, though it will still be a challenging year from a capex and telecom equipment revenue perspective.
- The near-term investment outlook is less favorable - carrier capex is expected to decline at a 2 percent CAGR over the next 3 years.
- With carrier revenues on track to advance slightly (+1 percent CAGR), capex/revenue is projected to approach 14 percent in 2027, down from 16 percent in 2024.
- Wireless capital intensity is projected to approach 12 to 13 percent in 2027, down five to six percentage points since the 5G peak.
The Dell'Oro Group Telecom Capex Report provides in-depth coverage of more than 50 telecom operators highlighting carrier revenue, capital expenditure, and capital intensity trends. The report provides actual and 3-year forecast details by carrier, by region by country (United States, Canada, China, India, Japan, and South Korea), and by technology (wireless/wireline). To purchase this report, please contact by email at dgsales@delloro.com.
Dell'Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, security, enterprise networks, security, and data center infrastructure markets. Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions. For more information, please contact Dell'Oro Group at +1.650.622.9400 or visit www.delloro.com.
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