Global telecom capital expenditure increased about 5 percent year over year in the first half of 2026, signaling an improvement in network investment after several years of declining spending, according to Dell’Oro Group.
The recovery, however, does not indicate the beginning of another massive network construction cycle similar to the initial 5G rollout. Telecom operators have already established stronger network capacity through years of investment in 5G and fiber, and their priorities are increasingly shifting toward capacity expansion, modernization, automation and network efficiency.
This change is reshaping the global telecom equipment market and the opportunities available to Ericsson, Nokia, Huawei, Samsung, ZTE, Cisco, Ciena, Dell, HPE, and other network technology suppliers.
Telecom Capex Returns to 5 percent Growth
Worldwide telecom capex increased approximately 5 percent in H1 2026, performing better than Dell’Oro had expected at the beginning of the year.
The improvement is significant because the telecom industry has been moving through a period of investment normalization following the heavy spending associated with 5G spectrum, radio networks and fiber deployment.
The latest figures also reinforce a broader change visible in the global telecom capex ranking for 2026, where major operators including AT&T, Deutsche Telekom, China Mobile, NTT and Verizon continue to invest billions of dollars in network infrastructure.
AT&T, for example, is targeting annual capital investment of around $23 billion-$24 billion, while Deutsche Telekom expects cash capex of approximately €17 billion. China Mobile has planned capital expenditure of RMB136.6 billion as investment increasingly extends into computing and AI infrastructure.
Some of the telecom operators have achieved significant growth in Capex. For instance, Globe Telecom increased capex 39 percent, e& lifted underlying capex 17.1 percent, Hrvatski Telekom grew investment 12.8 percent, Ooredoo raised capex 6.8 percent, while Cell C increased cash-flow-based capital expenditure 46 percent. Importantly, much of this spending is targeting 5G capacity, fiber, core-network modernization, data infrastructure and automation-related capabilities, rather than simply extending basic network coverage.
On the other hand, Deutsche Telekom’s cash capex fell by €0.4 billion, Orange’s eCAPEX rose only 2.7 percent, and MTN’s capex excluding leases declined from R20.8 billion to R19.7 billion.
Where telecom operators spend their capital is changing.
5G Coverage Gives Way to Capacity and Modernization
The first phase of the 5G investment cycle required operators to acquire spectrum, deploy new radios, upgrade thousands of mobile sites and rapidly extend 5G coverage.
Many operators are now in a stronger capacity position.
“The first half was stronger than we expected, but the improving near-term trajectory does not materially change the longer-term capex story,” said Stefan Pongratz, Vice President at Dell’Oro Group.
According to Pongratz, operators are gradually shifting their focus from coverage toward capacity, modernization, automation and efficiency.
Evidence of that shift can already be seen in the biggest mobile network deals of 2026.
Operators are investing in technologies including 5G Standalone, 5G-Advanced, AI-RAN, Open RAN, cloud-native mobile core, network automation and energy-efficient radio systems rather than simply adding more 5G coverage.
This transition is important for telecom equipment suppliers because future contracts will increasingly depend on demonstrating improvements in capacity, automation, energy consumption and overall network economics.
Telecom Equipment Revenue Also Grows 5 percent
The improvement in operator spending is already flowing through to equipment manufacturers.
Aggregate manufacturer revenue across the six telecom equipment programs tracked by Dell’Oro increased approximately 5 percent year over year during H1 2026.
The tracked markets include Broadband Access, Microwave Transport, Optical Transport, Mobile Core Network, Radio Access Network and High-End Router and Aggregation infrastructure.
These technologies sit at the center of the industry’s next investment phase.
Growing mobile data consumption requires additional radio capacity, while fiber, optical transport and high-capacity routers are needed to carry increasing traffic between mobile sites, data centers, cloud infrastructure and core networks.
Transport infrastructure is also moving toward 400G, 800G and multi-terabit capacity as operators prepare networks for 5G-Advanced, AI workloads and eventually 6G.
Equipment Market Could Grow Faster Than Telecom Capex
One of the most significant findings in Dell’Oro’s September 2026 forecast is the divergence between operator capex and telecom equipment revenue.
Dell’Oro expects worldwide telecom capex to grow at only a 0-1 percent CAGR between 2025 and 2030.
Telecom equipment revenue, however, is forecast to increase at a stronger 2-3 percent CAGR during the same period.
Incremental demand from cloud providers is one factor supporting the stronger equipment outlook.
The difference also suggests that equipment-market growth is becoming less dependent on operators simply increasing their overall capital budgets.
Instead, opportunities are emerging from changes in the investment mix, including higher-capacity optical infrastructure, network automation, cloud-native platforms, AI-enabled RAN and core networks, and infrastructure supporting cloud and data-center connectivity.
Ericsson, Nokia and Huawei Face a New RAN Market
The change is particularly important for the Radio Access Network market.
RAN experienced significant pressure after the initial global 5G investment peak. Dell’Oro previously estimated that the global RAN market lost nearly $10 billion in revenue over two years as the major 5G rollout cycle slowed.
The next opportunity will therefore be different from the previous cycle.
Ericsson, Nokia, Huawei and Samsung increasingly need to compete on software capabilities, artificial intelligence, automation, energy efficiency, cloud integration and the ability to extract more capacity from operators’ existing spectrum assets.
The growing focus on AI-RAN and network modernization illustrates how vendor competition is moving beyond conventional radio hardware.
For operators, the objective is increasingly to carry more traffic without allowing network costs to rise at the same rate.
Capital Intensity to Fall from 18 percent to Around 14 percent
Another important indicator is capital intensity — the percentage of operator revenue allocated to capital expenditure.
Dell’Oro says global telecom capital intensity peaked at approximately 18 percent in 2022.
It is forecast to decline to around 14 percent by 2028.
Improving operator revenue is helping lower capital intensity even when absolute network investment remains relatively stable.
That could create a healthier investment environment because operators may be able to maintain spending on network capacity and modernization while committing a smaller proportion of revenue to infrastructure.
Efficiency therefore becomes increasingly important.
Network investments will need to demonstrate measurable improvements such as greater spectral efficiency, lower energy consumption, reduced operating costs, higher capacity or additional revenue opportunities.
Globe Telecom
Globe Telecom invested ₱26.3 billion during H1 2026, up 39 percent year over year. Around 91 percent of capex was directed toward data and digital infrastructure, including expanding 5G coverage and improving mobile and home broadband networks.
e&
e& reported H1 2026 capex of AED 6.4 billion. More importantly for underlying network investment, capex excluding spectrum and licenses increased 17.1 percent to AED 4.9 billion. Its capex intensity excluding spectrum and licenses reached 12.8 percent of revenue.
Hrvatski Telekom
Hrvatski Telekom increased investments 12.8 percent to €131.9 million in H1 2026. Spending was directed toward gigabit fiber, 5G networks, data-center infrastructure and core-system resilience.
Ooredoo
Ooredoo deployed QAR 1.6 billion of capex in H1 2026, an increase of 6.8 percent, focusing on network leadership and capacity expansion, particularly in Algeria, Qatar and Tunisia, to accommodate growing data demand. Ooredoo’s Q1 capex alone had risen 13 percent, showing that higher investment started early in 2026.
AI and Automation Become Bigger Capex Priorities
Artificial intelligence could become an increasingly important part of this investment equation.
AI can be used to predict network congestion, optimize radio resources, automate network operations, identify faults and manage energy consumption.
Operators are also deploying cloud-native mobile cores and automation platforms that allow networks to become more programmable.
The economics are compelling because mobile data traffic continues to increase much faster than operator network spending.
Global mobile traffic has already exceeded 220 exabytes per month, increasing pressure on operators to reduce the cost of carrying each additional gigabyte.
6G Could Trigger the Next Investment Upswing
Dell’Oro expects capital intensity to begin increasing modestly after 2028 as early 6G investment emerges.
Commercial 6G networks are generally expected around the end of the decade, but operators are already conducting trials involving AI-native networks, 6-8 GHz spectrum, advanced antennas, integrated sensing and satellite connectivity.
TelecomLead’s analysis of the 6G investment race toward 2030 shows that China Mobile, China Telecom, China Unicom, NTT DOCOMO, KDDI, SK Telecom, T-Mobile, AT&T and other operators are already participating in technology development and trials.
The transition may be more evolutionary than previous mobile-generation changes because current spending on fiber, cloud-native cores, AI, virtualization, transport networks and 5G-Advanced can provide foundations for future 6G networks.
Telecom Capex Enters a Different Growth Cycle
The 5 percent increase in global telecom capex during H1 2026 is encouraging for the telecom equipment industry, but it does not signal a return to the massive coverage-driven investment cycle seen during the early years of 5G.
Instead, telecom investment is entering a more selective phase.
Operators increasingly need to generate more capacity, better performance and lower operating costs from every dollar of capital expenditure.
That favors investment in 5G capacity, fiber, optical transport, AI, automation, cloud-native core networks and energy-efficient RAN infrastructure.
BABURAJAN KIZHAKEDATH
