BT cuts annual revenue forecast – what's next for the telecoms giant?
BT has trimmed its sales forecast, but the overall outlook remains positive and big investors have bought in. Should you invest?


The “weak” performance of BT’s “problem child” business unit is still hampering CEO Allison Kirkby’s turnaround plan, says Jillian Deutsch on Bloomberg. BT was forced to cut its sales forecast for the year to 31 March 2025 by between 1% and 2% on 7 November. This was caused by a 6.8% adjusted revenue decline in the division serving business customers. As a result, overall second-quarter revenue fell 3% to £5.09 billion, below analysts’ expectations of £5.23 billion. BT’s shares promptly slipped by 5%.
It’s not surprising that BT’s business unit isn’t doing very well, says Hargreaves Lansdown’s Matt Britzman. Higher expenses and “a tough competitive landscape make it a tricky place to operate”. But investors can console themselves that profit and cash-flow guidance has been “left untouched”. What’s more, as the fibre rollout gathers pace, BP is not only “benefiting from higher prices and a more favourable mix of fibre versus older technology”, but also from the prospect of an end to the “massive investment” the rollout involves. Expect a major improvement” in areas such as cash flow.
Should investors buy BT?
Hopes that “once the digging has finished and 5G investment has been made”, BT can become a “strongly cash-generative provider of critical 21st-century infrastructure” will have been bolstered by Kirby’s determination to “rein in the foreign adventures and concentrate on the UK”, says Nils Pratley in The Guardian. While BT’s international operations comprise only a sixth of the company, they are a “sprawl” that spans 180 countries, and have been responsible for two destabilising profit warnings in 2008 and 2017. Still, selling these operations “won’t be easy”, with a series of “part-sales, partnerships and fiddly structures” a more likely option than “a neat sale of the whole shebang at a nice price”.
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It’s certainly “easier to earmark disposals than to snuffle out buyers”, says Lex in the Financial Times. So BT may have to settle for raising “a few hundred million here and there” from sales over an extended period of time. But some companies may be interested in the unwanted elements of BT, including rivals and private equity. Partial sales such as joint ventures are another option. What’s more, shareholders should take heart from the fact that Kirkby does have form when it comes to such “complicated clear-outs”. She oversaw a similar process at Sweden’s Telia.
BT has reportedly hired bankers to sell financial services unit Radianz, says Rupert Neate in The Sunday Times. Overall, investors have been “impressed” by Kirkby, especially her progress on broadband, as well as her determination to push through a savings drive that could see 55,000 jobs go by the end of the decade. While many feel that markets are still “stubbornly” refusing to price in the full impact of future cash flows, the share price has soared 27% in her 10-month tenure, with prominent investors, such as Carlos Slim and Sunil Mittal, taking major stakes.
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Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
Follow Matthew on Twitter: @DrMatthewPartri
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