Inwit Stock

Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the INWIT Second Quarter 2026 Results Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Luigi Minerva, Strategy, M&A and Investor Relations Director of INWIT. Please go ahead, sir.

Thank you, operator. Good morning, everyone, and thank you for joining us. With me today, I have Diego Galli, INWIT's General Manager; and Emilia Trudu, Chief Financial Officer. Before we begin, please allow me to draw your attention to the safe harbor statement on Page 2. Following a brief presentation of the second quarter 2026 results, we will open the floor to questions. Over to you, Diego.

Thank you, Luigi, and good morning, everyone. Q2 2026 results are very much consistent with our confirmed full year 2026 guidance, which reflects the current market context. The telco sector in Italy continues to go through a challenging phase with low returns and minimum investments. Moving to the MSA dispute, we disagree with the recent interim decisions, and we filed appeal against both ruling.

We continue to believe that the MSA early termination notices are instrumental and fall outside the legal framework of the MSAs, which are valid until 2038. INWIT runs very efficiently the best quality and largely unique network in Italy. There are no rational alternatives to INWIT's network from a strategic, operational and financial perspective. INWIT remains committed to invest while collaborating with its clients to identify shared value for value solutions on a fair and rational basis.

Moving to Q2 results. New sites in new PoPs reflect the current market context, while the pace of real estate transactions remains sustained. As we anticipated, revenues on a reported basis are declining year-on-year by around 1%. Revenues are negatively impacted by the absence of uncommitted revenues linked to discretionary projects. If we were to remove such discretionary project-based revenues from Q2 2025 numbers, Q2 2026 revenues would show normalized annual growth above 3%.

EBITDA after leases margins at around 72% are in line with the 2026 full year guidance. Following the dividend payments in May, our leverage ratio is now 5.7x and will decline to the midpoint of our 5 to 6x leverage corridor by year-end. At the current share price, INWIT offers a dividend yield of around 8.6%, reflecting the undervaluation of our stock.

I hand it over to Emilia now for a review of KPIs and financials.

Thank you, Diego, and good morning, everyone. Operational KPIs reflect the current challenging market context. The deployment of 50 new towers in this quarter represents a slight improvement over Q1 and keeps us on track to reach our target of around 200 new towers in 2026. 380 new PoPs were added in the quarter, confirming a growing tenancy ratio now at 2.4. We are aiming for more than 1,500 new PoPs in 2026, targeting a year-over-year continuous growth in tenancy ratio. Additionally, 400 completed real estate transactions confirm our strong track record, aiming for approximately 1,600 transactions in 2026.

Year-to-date, we have built 65 new dedicated DAS with projects in larger-than-average location size in Q2. With regards to the next-generation EU program, Italia 5G, we completed the coverage across more than 500 square kilometers of the countrywide areas, actively bridging the digital device gap that affects those areas. We are making progress on Rome 5G smart city project, bringing 5G connectivity on the metro and digitalization to 100 public squares.

The normalized 2025 total revenues base takes into account the lack of project-based noncommitted revenue components, which we have developed over time with operators capturing their discretionary spending. Such discretionary budgets have been put on hold at this stage given the current context of subdued operator investments and stagnant commercial relationships.

Adjusting for this one-off step downs, we delivered approximately 3% normalized revenues growth in Q2 2026, driven by the following components: inflation linked based on a 2025 average index of 1.4%, anchor commitment in terms of new towers, new PoPs and thus deployment in line with MSA commitments. Steady growth across other MNOs and IoT, Smart Infra growth, particularly in indoor DAS across premium locations and projects in the Smart City vertical. Normalized growth is structural, and we expect the business to go back to growth in 2027, in line with the midterm baseline outlook.

Moving to our financial highlights for the quarter. Q2 revenues reached EUR 267 million, up 1% quarter-on-quarter and down 1% year-on-year, representing over 3% normalized revenue growth year-on-year, as we just discussed. Revenues components included for towers and revenues up 2.8%, supported by inflation and MSA commitment. Conversely, OLOs and Smart Infra revenues were down as a result of the lack of project-based revenues such as work and service, installation upgrades and DAS, more than offsetting the underlying growing number of PoPs and DAS locations covered.

On profitability, EBITDA was up 0.5% quarter-on-quarter and down 2% year-on-year to EUR 240.7 million with an EBITDA margin of over 90%. EBITDA after leases stood at approximately EUR 191 million, up 0.5% quarter-on-quarter and down 2.8% year-on-year with a 71.5% margin, reflecting the structural operational efficiency of our business model, which allows us to support substantial investments. And as a reminder, we closed 2025 with a return on capital employed of 8.4%.

The quarterly recurring free cash flow reflects the expected phasing of financial charges and remains consistent with 2026 full year guidance. In H1, recurring free cash flow reached EUR 300 million, down 5% year-on-year with 63% cash conversion. This was driven by structurally low recurring CapEx, efficient taxes, thanks to the goodwill tax scheme, slightly positive net working capital and financial charges profile that reflect phasing of interest payments.

Below the recurring free cash flow line, CapEx were just above EUR 70 million in Q2 and EUR 160 million in H1, consistent with guidance. We closed H1 with free cash flow to equity of about EUR 140 million. Leverage ratio reached 5.7 following the dividend payment in May. We expect it to go back to 5.5 by year-end, in line with our guidance. We have an efficient debt profile out of which 80% is fixed, 20% floating. The current average cost of debt is below 3%, and the average bond maturity is above 4 years.

I now hand it back to Diego for the guidance and the closing section. Thank you.

Thank you, Emilia. We reiterate our 2026 targets and medium-term baseline outlook, reflecting the current market environment. Even in the unrealistic scenario in which the market remains stuck over the medium term, we would still be able to have a decent organic growth at around 3% for revenue and 4% for EBITDAaL, an attractive stable dividend and a solid balance sheet.

The baseline outlook does not include the following potential upside, normalization of the industry dynamics, densification outdoor and indoor, opportunities to expand across digital infrastructure. At the same time, the baseline outlook does not include the downside risk of MSA's actual termination as we don't believe this is a likely or realistic outcome.

Moving to the next slide, let me reiterate a few important consideration on the MSA prices and terms. All our prices are in line with the market. They are even more attractive because the MSA fee also includes unique rights to the benefit of the anchors. Once more, a benchmark of the MSA anchor tenants fees shows that they are competitive and well below the European average. The average total fee for Point of Presence is around EUR 20,000. This is a combination of sales and leaseback, new towers and new PoPs.

We estimate that broadly half of the fee is related to the financial component of this hosting fee.

On both components, MSAs provide convenient and competitive terms. Clearly, they are intrinsically linked to the structure of the sales and leaseback transaction as industry standard. We paid around EUR 500,000 per tower with a transaction that included a large financial component with an EBITDA per tower of around EUR 25,000. Our payback period on the MSA and leaseback transaction is around 20 years, consistent with the necessary long duration of the MSA contracts.

You know the next slide very well. Our network of about 26,000 sites is the result of 40 years of work from TIM, Vodafone and INWIT, where we could take the benefit of first-mover advantage to build top quality sites in the best available locations. Our network is the result of the consolidation of multiple networks, best quality locations connected with fiber, almost 20% land-owned, optimized lease cost, best tenancy ratio. About 75% of our network is made of unique locations. INWIT is a strategic infrastructure critical to the national security and economy. Our network is available to our anchors on an all-or-nothing basis.

Data traffic keeps growing. 2025 download traffic grew by 19% and upload traffic grew by 35%. We believe that the market needs further 10,000 towers in the next few years to cope with additional capacity in urban areas, coverage in suburban and rail and road corridors. The ongoing spectrum renewal process can unlock a new cycle of investments. We would welcome proposals to link the spectrum renewal to current orders with future CapEx commitments to support network quality improvement and the country digitalization.

However, plans to improve quality are not compatible with the termination of renewed contracts. Level of service could not be maintained while repatriating the best network. Duplication will last decades, will delay densification and cost billions. In the current industry structure where there is a separation between tower cos and service companies, we think that the spectrum renewal framework should discourage duplication of infrastructure and support stability and predictability.

About MSA dispute, the interim recent decisions were not in our favor. Ruling did not recognize the requirement based on the assessment of the financial strength of the company. Also, there was a view of change of control, which we disagree with. We appealed the decisions, and we remain convinced about the strength of our argument. In particular, change of control did happen in August 2022 when the shareholder agreement between Telecom Italia and Vodafone Group was terminated.

Any different interpretation would have triggered a mandatory tender offer, which did not happen. In terms of timing, we expect the appeals to be concluded by November 2026, while the ordinary process will last for several years. Anyway, we remain convinced that the situation should be addressed through fair and reasonable discussions between INWIT and its clients to identify shared value for value solutions.

Q2 results are consistent with 2026 guidance. We reiterate both 2026 and midterm guidance. INWIT has the best assets. There is no rational case for duplicating the existing high-quality infrastructure. TIM and Vodafone monetize their assets and INWIT paid in excess of EUR 10 billion in exchange for long-term contracts and proportional fees. INWIT business model and operational efficiency consistently bring a material benefit to its clients and the industry. In Italy, there is a dramatic need for investments in densification in order to increase the performance and resilience of the network and INWIT is the best option. And we remain committed to invest while collaborating with our customers to identify shared value for value solution on fair and rational basis.

With this, we thank you for your attention, and we will now open the floor to Q&A.

[Operator Instructions] The first question comes from Roshan Ranjit with Deutsche Bank.

I've got 2 questions, please. Firstly, Diego, thanks for the detail on the appeals process. One question I had was I thought it was quite interesting, the language that was used from the judge as part of the TI hearing versus the Fastweb hearing where it seems they gave a bit more color perhaps going into the details of the merits of their stance on the merits of the case. Can you explain why they were able to provide more color on the TI situation versus the Fastweb situation, please? And secondly, you mentioned the spectrum framework auction. Any details there because I think we should be hearing in the next day or 2 and the trade-off between renewals versus investments. Have you been involved in any discussions there with [ DAS comp ]?

Yes. Clearly, on the TI and Fastweb ruling, actually, we disagree on both. Basically the merit of the -- the content is basically very similar. The TI tone was more on the urgency and Fastweb was on the merit on the change of control. Honestly, from no specific reasons for behind that transparent and clear to us. Anyway, yes, in our view, there is some consistency. And as we know, the injunction process is a process basically which follows a brief approach from a single judge. We just appealed yesterday and the day before yesterday, and we remain convinced that the change of control did happen in 2022, and there is no space for a different interpretation because among others, as we said, a different interpretation would have triggered a mandatory tender offer.

On the spectrum, yes, the process is ongoing since a while, will continue. Clearly, we are a relevant part of the industry, and we are involved. Our position has been and is positive supporting all approaches which are supporting and facilitating investments, new investment cycle in Italy. At the same time, we think that is important that the framework is supporting the overall industry and so telco infra companies -- of the entire value chain.

Great. And when should we hear on the framework? I thought it was kind of end of July. So it should be this week, we should be hearing on the details?

Yes. There should be -- the expectation is about the consultation document to come out in a few days or a few hours, let me say. Consultation documents will be available for the government to take a decision and the consultation will be open for 60 days.

The next question comes from Fabio Pavan with Mediobanca.

First one is a follow-up on AGCOM. Provided we should have consultation document in a few hours or days, then it will be up to the government to decide how to, let's say, to replace this renewal. Do you think this is something that could be solved before year-end? And do you think a decision on spectrum renewal could come also if the uncertainty on the MSAs persist? Second question is quite simple. I was just wondering if in these days or weeks, you are engaging in some form of discussions with your anchors.

Fabio, on the timing, as we said, consultation out in a few days. Consultation will be open for 60 days, then eventually will be to the government to decide if there is a scenario where there is a decision by year-end. Clearly, the industry has been underinvested for years. So -- and all the players need visibility and predictability. So the sooner the better in terms of supporting the industry and the new cycle, the new cycle of investments. With regards to the -- can I say, the intersection with the MSA, honestly, I think that the new investment cycle is not consistent with the current situation. And I think that any plan to improve quality and support the country digitalization is not consistent. It's not compatible with the current situation on MSA with the termination of INWIT contracts, which are fundamentally with infrastructure is fundamental to support in the most efficient way, not only the maintenance of current service level, but the improvement.

On the engagement with the anchors, we have the process open with Telecom Italia on the, let me say, assisted procedure with law or legally assisted procedure. And while with Fastweb, there is no procedure. This was rejected, our proposal was rejected by Fastweb a few months ago, and that's where we are.

The next question comes from Paul Sidney with Berenberg.

Just 2 questions from me, sort of big picture questions. You built 50 towers in the quarter. I'm guessing that's more than your competitors. I was just wondering, do you have a structural advantage over your competitors in the Italian market in terms of building new sites? And second question, we know that Italy needs 10,000 new towers, but there's obviously consolidation that's being speculated. But in my mind, why would mobile operators want to reduce the number of sites? So do you see actually consolidation as a potential problem in terms of reducing the number of towers that are needed? Or is it all part of this need for the 10,000 new towers irrespective of consolidation?

Paul, on the competitive advantage from an investor point of view, I would say that INWIT has been in the last years, the company building the highest number of sites and actually in the market. Iliad has been building some towers, but excluding Iliad, we have been the only ones building the towers. And we have consistently built the end-to-end, let me call, operational machine from search to location search to permit to construction to maintenance, and we think we have the most efficient and effective operational machine in the country.

Let me say that also from a contractual point of view, we have a preferred supplier relationship with TIM and Vodafone, whereby we have the right of first offer and last call on all new towers. So we think that we have both an industrial and a contractual strong position. With regards to consolidation, it may drive on the short term some loss of point of presence but overall, it could be also the way to drive the market to be more sustainable and support the investments to improve the quality and to ensure the operators to have better investment. So the overall context would be more supportive of investments.

And additional towers are structurally needed because as we said, the data traffic has constantly increased. Artificial intelligence adds an additional layer on top. And this is -- 5G is dramatically behind in Italy. Italy is behind Europe and Europe is behind the world, yes. Additional point of presence are needed both for capacity reasons in urban areas and the coverage in suburban and as we said, on transport corridors. So again, concluding, consolidation may drive some reduction in the short term. But overall, we have a positive view for the medium, long term.

That's great. Can I just have a quick follow-up. Does the Italian government recognize that there is the need for towers, the 10 towers number. What's the view of the Italian government?

I think that there is an overall recognition that the industry has been under strong pressure in terms of returns, and that's not sustainable and that has reduced investments in the last years, and there is a significant need to speed up the investments again to accelerate on 5G deployment for the benefit of social communities as well as companies and the economy. About the numbers, there may be different views, but I think that the order of magnitude is -- how can I say, there is a consensus about the order of magnitude to densify the network and to cope, as I said, for -- to cope with the additional capacity and coverage, which is needed.

The next question comes from Rohit Modi with Citi.

I have 2, please. One is a follow-up basically on engagement with anchors. I believe, and please correct me if I'm wrong, that you need to finalize your migration plan by 31st of March '27 as per the MSA if things remain as it is now. Now whether you engage with them on migration after the appeal decision or you will wait for it? And if you win the appeal decision, you need to discuss the migration plan that can be postponed until you get the decision from the original case?

And second question is basically on the quality of your PoPs, particularly in the OLO segment. PoP growth has in the OLO segment has been consistent, but we see the revenue growth has -- revenue has declined over 1H. And if I look at your slide on Slide 17, if you look at the chart, which is there's a growth in OLO from '25 to '26. I'm just wondering if do you expect the higher growth coming in OLO in the second half or if there is kind of discretionary revenue impact that's coming in there?

Let me start from the second question on OLOs, and let me comment that in general, the market is quite soft. Honestly also the lack of visibility on the frequency renewal process and as we said, in general, the low returns on investments are making the market overall soft. Specifically with OLOs, we are doing good progress with our OLO customers. And the financial trend is impacted from the fact that last year, we had some special projects on discretionary spend, which this year has not been repeated. So basically related to specific work orders, specific project-based activities, which are depending on customers' availability, customer budgets are not recurring every year. There were last year, but not in this quarter.

With regards to the engagement and let me -- the repatriation plan, the MSA says that the repatriation plan, so the plan whereby anchors have to give back and free up the towers giving it back to INWIT. So the repatriation plan should be completed by a period which should not be shorter than 3 years. So completion in a period not shorter than 3 years. That is the MSA framework. Honestly, we keep on being convinced that the current contract lasts until 2038. We know that the legal process will continue. The ordinary process will last 4 years. But anyway, we are open to be engaged and to engage with the operators if they want to start sharing the repatriation plan.

Sorry, just clarification. You need to agree on a migration plan by 31st of March '27, right? That's the case or you don't have to on the part of contract?

Yes. The repatriation plan has to be agreed between parties 1 year before the termination of the contract.

The next question comes from Ben Rickett with New Street Research.

I had 2, please. Firstly, coming back to your discussions with the anchors, I think you said you're in talks with TIM. I just wondered if you could say anything about how productive those discussions have been so far and whether you're optimistic that a resolution can be achieved. And then on Fastweb, when do you expect discussions with them to start again? And then a second question, I was just interested in how much this is all costing you in terms of legal fees and consulting fees. Presumably that's embedded within the guidance, but I was just wondering if you could quantify the cost of this dispute from additional sort of professional fees.

Ben, let me say, I think it's too early to be optimistic or pessimistic. I think that the engagement with the customers is still clearly impacted by the legal processes and some uncertainties around the context. Anyway, with TIM, they legally assisted the process, let me say, is moving on, I would say, slowly. And so let's see. The procedure will be open until mid-September. Fastweb, we are open to discuss. And we have been always open, as we said, we do appreciate discussion based on rational and fair approach. And the discussion about repatriation plan and open to start having those discussions as soon as Fastweb will trigger them.

On the cost, let me say that the costs are some millions of euros. We can estimate, yes, the low absolutely, let me say, a couple of millions, a few millions. Clearly, we would have preferred to invest this couple of millions in new towers instead of legal cases, but this is where we are.

That's helpful. And of interest, why are you not discussing with TIM and Fastweb together given that their [ presenting ] are very similar, they have the same contract, et cetera.

Honestly, I think that at a certain point in time, there could be a scenario, but I don't see neither a helpful or a realistic scenario in this case. And yes. . .

The next question comes from Milo Silvestre with Equita.

Just a quick follow-up on the last question. You mentioned a slow engagement with anchors due to legal process. And is that because you are waiting for the final ruling on the interim measure.

As we said, we are open to discuss. And so -- and clearly, the legal process we think should give clarity on the legal framework. This didn't happen with the recent decisions, but we remain confident that through the appeal process the decision will help give clarity about the legal context, which may facilitate then the business discussion. So honestly, we remain focused on having scenarios where we can have discussion based on fair and rational approach. The legally assisted procedure with TIM can support this approach, and we will see. The current situation is not great for INWIT, of course. I think it's not great for anyone, the industry is told. It's impossible to plan and define the investments which are needed. So I think that the effort and willingness to get out from this situation of fair and rational approach should be from all parties.

And regarding procedure with TIM, are we discussing about the MSA or on minor, let's say, topics?

Yes, we started from more specific operational topics. So these are the ones which are currently under discussion. The overall framework is -- covers everything, but the current discussions started from more operational topics.

The next question comes from Ondrej Cabejsek with UBS.

I have a question related to the potential investment obligations or remedies related to the spectrum update that you said we're expecting very shortly. So obviously, there will be a consultation period. There will be, I guess, a follow-up in terms of the budget and those 2 things or those several things, including the AGCOM, the budget, et cetera, will form, I guess, an opinion or clarity around what the associated potential investment obligations are. Presumably, this will impact everyone starting 2029. And I was curious from your perspective, when is the time that given, I guess, various planning considerations, permits considerations, et cetera, when is the time that the -- from your perspective, that the anchors really have to start committing to some build with respect to these obligations? So is it kind of going into 2027 because maybe the lead time is a bit longer, say, 2 years to achieve these? Is it maybe a year later? Like any color on when there starts to be a situation that not doing anything in terms of the kind of MSA dispute starts to hurt both sides and then I guess the party on the kind of network build side more economically.

Ondrej, yes, the intersection between the spectrum renewal process and the investment plans and MSAs, honestly, it's an interesting one. It's really the trigger is the actually the decision about the spectrum renewal. Then I think that immediately after that, there will be the need to define the plans actually to get the spectrum renewal. I think that plans should be already been defined in order to get the renewal. So that's an important trigger, which will quite fast then drive the need to put on the ground investments. And again, I think that the current context and situation and termination of the contract with INWIT are not consistent, compatible with plans to invest based on a spectrum renewal with commitments to improve quality.

I guess the plans that you mentioned, they're a function of what the obligations might be, right? So we don't know those yet. And I'm sure you have potentially some opinion given how the state of the grid of mobile networks in Italy looks like. But like more practically speaking, if we're talking about an average kind of process for a new tower, which obviously, again, depends, I guess, on the area, et cetera. But speaking about averages, how long before a tower has to be in the ground. Do the parties involved actually start to kind of work on the permit processes, et cetera? If you can be more specific, that would be very helpful.

Yes. I mean you are right, it depends on the areas. But on average, the time it takes to roll out new towers takes 12, 15 months. That's the kind of time horizon.

[Operator Instructions] The next question comes from Abhilash Mohapatra with BNP Paribas.

My question was on Slide 12. It's obviously a slide you've shown us in the past where you talk about the tower market potential, 7,000 to 12,000 new towers. I guess my question is, how much of that growth do you think you can accommodate on existing INWIT sites? And therefore, I suppose the balance would involve building new towers, but how much of that growth can you actually accommodate by adding on secondary tenancies on your existing portfolio?

Yes. Actually, Abhilash, that's the need for additional Point of Presence in the sense of additional towers. So basically all incremental. That's the way to consider it because as we said, there is the additional need in urban areas for capacity and which cannot be accommodated on the current towers as well as coverage in suburban and rail and road corridors. So all this requires additional towers, new towers.

Got it. That's helpful. And maybe just to follow up. I suppose what is -- what prevents the telcos from building those towers on their own? Why would they necessarily come to INWIT for building these sites?

Yes. The 2 considerations. The first one is related to the preferred supplier clause, whereby the anchor tenants are committed to have a special relationship with INWIT. INWIT has the right of making the first proposal and the last offer for all new towers deal. Let me also say that INWIT is the most efficient company to do this kind of stuff. We are dedicated. We have taken the best people from TIM and Vodafone through the carve-out in the past. And so the teams and the people were moved to INWIT actually. And in the last years, we have kept on investing on improving capabilities, systems and process to deliver new towers in the quickest and most efficient way. So we think that both from a contractual point of view, but underpinned by the best capacity, industrial capacity in the country. And that's the reason why we have a competitive advantage in the market.

Gentlemen, there are no more questions registered at this time.

Thank you all.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones. Thank you.

Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the INWIT First Quarter 2026 Results Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Luigi Minerva, Strategy, M&A and Investor Relations Director of INWIT.

Please go ahead, sir.

Thank you, and good morning, everyone. Thanks for joining us today. I have with me Diego Galli, INWIT's General Manager; and Emilia Trudu, Chief Financial Officer. Before we begin, please allow me to draw your attention to the safe harbor statement on Page 2 of the presentation.

Following a brief presentation on the Q1 2026 results, we will open the floor to questions. Over to you, Diego.

Thank you, Luigi, and good morning, everyone. In today's session, we share our Q1 2026 results, which are consistent with our full year 2026 guidance, reflecting the current telecom market context. A reminder of our 2026 guidance and medium-term baseline outlook, both of which are fully reiterated and a recap of our key strategic point of strength centered on INWIT's high-quality and unique network.

The telco sector in Italy continues to go through a challenging phase with low returns and the minimum investment from operators. Mutual infra players can play a key role in this context, leveraging on sharing economics to deliver investments in digitalization in the most efficient way. Our MSAs create value, thanks to the consolidation of infrastructure and the unlocking of sharing synergies to the benefit of all parties.

As you already know, our anchor tenants sent us early termination notices in March. We have been clear that both fall outside the legal framework of the MSAs and have taken legal actions to protect INWIT. Anyway, our wish is to move from the legal ground back to business and industrial investment. INWIT remains committed to invest while collaborating with its customers to identify shared value for value solutions.

Moving to the next slide. Q1 results are consistent with our full year 2026 guidance. New sites and new PoPs reflect the current market context, while the pace of real estate transactions remain sustained. As we anticipated, revenues on a reported basis are declining year-on-year by around 1%. Revenues are impacted by the absence of uncommitted revenues linked to discretionary project-based revenues. If we were to remove such discretionary project-based revenues from the Q1 2025 numbers, the Q1 2026 revenues show a normalized annual growth above 3%. EBITDA after leases margins at around 72% are in line with guidance. Our leverage ratio remained stable quarter-over-quarter at 5.2x. In a few days, we will pay about EUR 500 million in ordinary dividend, which implies a dividend yield of more than 7% at current levels, reflecting the current undervalued share price. I hand it over to Emilia now for a review of KPIs and the financials.

Operational KPIs in the quarter reflect the current challenging market context. 30 new towers in Q1 is a soft start, and we expect a pickup in H2 in line with our target of around 200 new towers in 2026. Around 300 new PoPs in the quarter, with tenancy ratio growing to 2.39. We are aiming for more than 1,700 new POPs in 2026 with year-over-year continuous growth in tenancy ratio. 60 new dedicated DAS covering premium indoor locations across multiple verticals for a total of around 850, targeting approximately 900 locations in full year '26.

400 real estate transactions in the quarter confirm our strong track record, aiming for a total of approximately 1,600 transactions in full year '26. The normalized 2025 total revenue base takes into account the lack of project-based non-committed revenue components, which we have developed over time with operators, capturing their discretionary flexible budget. As discussed during our full year 2025 results conference call, such discretionary budgets have been put on hold at this stage given the current context of limited budgets and stagnant relationships. Adjusting for this one-off step-downs, we delivered over 3% normalized revenue growth in Q1 2026, driven by the following components: inflation CPI-linked based on a 2025 average index of 1.4%, anchor commitments in towers, new POPs and DAS deployment in line with MSA, OLOs growth with steady pace across other MNOs and IoT, Smart infra growth in indoor DAS across premium locations and smart city verticals.

Q1 revenues were minus 1% year-on-year at EUR 264 million, representing over 3% normalized revenue growth year-on-year as we just discussed. Key revenue components, including tower anchor revenues up 2%, supported by inflation and MSA commitment. OLOs and Smart Infra revenues down as a result of the lack of project-based revenues, such as work and studies, installation upgrades on DAS, more than offsetting the growing number of POPs and DAS locations covered.

EBITDA down 1.9% year-on-year to EUR 239.5 million, with an EBITDA margin of 91%. EBITDA after leases down 2.2% year-on-year to above EUR 190 million and a margin of 72%, reflecting INWIT's structural operational efficiency. Recurring free cash flow at EUR 176 million has a front-end loaded profile for the year, and net debt at approximately EUR 5 billion, including IFRS 16 liabilities, resulting in a 5.2 leverage ratio in line with December 2025. Recurring free cash flow in 2026 has a front-end loaded profile while remaining consistent with 2026 full year guidance. In Q1, recurring free cash flow reached EUR 176 million, up by 11% year-on-year with 74% cash conversion. This was driven by structurally lower recurring CapEx. No taxes were cashed out with a tax payment scheduled for Q2 and Q4 as per usual seasonality. Positive net working capital of approximately EUR 10 million and financial charges reflecting an efficient debt profile and the specific phasing of interest bond payments.

Below the recurring free cash flow line, gross CapEx was just below EUR 80 million to EUR 90 million due to phasing. We closed the quarter with free cash flow to equity of nearly EUR 88 million. Leverage ratio is stable at 5.2x, in line with Q4 2025, and we have an efficient debt profile out of which 85% is fixed, 15% floating with a current average cost of debt of approximately 3% and average bond maturity of 4.3 years. Furthermore, we have just extended our EUR 1 billion bank facilities originally maturing in 2027 to 2031, led by a pool of primary banks. I now hand it back to Diego for the guidance in the closing section. Thank you.

Thank you, Emilia. We reiterate our 2026 targets, medium-term baseline outlook, reflecting the current market environment. Even in the unrealistic scenario in which the market remains stuck over the medium term, we will be able to have a decent organic growth, an attractive dividend and a solid balance sheet. The baseline outlook does not include the potential upside related to the normalization of the industry dynamics, the network densification, both outdoor and indoor and INWIT opportunities to expand across digital infrastructure.

At the same time, the baseline outlook does not include the downside risks of MSAs' termination as we don't believe this is a likely or realistic outcome.

Moving to the next slide. We are protecting the integrity of the MSA and INWIT rights to the legal path, and we are confident on the strength of our arguments. However, we would rather focus on investing in efficient growth and value creation for all parties and stakeholders. It's not appropriate to enter into legal details considering that the case is open. Let me just say that timing-wise, it's moving on as expected given the complexity of the case. I'm also keen to reiterate that we have always executed the contract in fairness and good faith. Of course, being open to discuss with our customers and, by the way, as envisaged by the contract itself, to further optimize the commercial opportunities within the contract framework.

At the same time, good faith discussions require the identification of solutions that create value for all parties, being also mindful of the impact on all stakeholders, including the public interest related to the strategic nature of our infrastructure.

Moving to the next slide, let me reiterate a few important considerations on our MSAs prices and terms. MSAs fees are competitive and intrinsically linked to the structure of the sales and leaseback transactions as industry standard. The higher the upfront amount paid to the operator, the higher the resulting tower MSA fees. With regards to INWIT, the MSA terms and conditions are an integral part of the overall transaction carried out in 2020. The average total fee per pole is around EUR 20,000. This is the combination of sales and leaseback towers, new towers and new PoPs.

We can estimate that broadly half of the fee is related to the financial component of the transaction, which is comparable to the interest fee of a perpetual bond, while the other half is related to the pure hosting fee. All our prices are in line with the market. They are even more attractive because the MSA fees also include unique rights to the benefit of anchors.

On the left-hand side of the slide, we show once more a benchmark of our MSAs tenant fees, which are competitive and well below the European average. Finally, we are aware we benefit from an uncapped escalator linked to the inflation. This is a better feature than in other European MSAs. We paid for this as for all the other components of the MSAs in the 2020 sale and leaseback transactions. Looking at the 5 years or 10 years time framework, the average inflation that we applied with our escalators has been about 2% or 3%, basically in line with historical trends and expectations. Anyway, we understand that the uncapped escalator created some specific impact and going forward, uncertainty for our clients, and we have been and we are open to talk about alternative approaches. Talking about infrastructure and network, our network of about 26,000 sites is the result of 40 years of work from Telecom Italia, Vodafone and INWIT, where we could take the benefit of first-mover advantage to build top quality sites in the best available location. 35% of our sites are in unique locations. This means that there is no other tower company within relevant distance range.

For 40% of sites, there are other alternatives within the relevant range. However, either there is no space available on the towers or there are technical issues that prevent the same quality. Our network is available to our anchors on an all-or-nothing basis. As I said, our network is the result of the consolidation of multiple network and is a material source of efficiency within the industry through the benefits of sharing economics. A consolidated and optimized network is also a way to reduce the use of natural resources.

Greenfield initiatives in a mature market create infrastructure duplication and fragmentation, leading to medium- to long-term inefficiency and a structural higher cost base for the industry. Furthermore, we believe that the market needs further 10,000 new towers in the next few years. Such greenfield initiatives would divert CapEx and delivery capacity away from the network densification that the Italian market needs to make the much needed progress on digitalization.

Final remarks from my side. Q1 results are consistent with our 2026 guidance. The towers business model is based on long-term contracts that create value for all parties, thanks to sharing economics and network efficiencies. The Italian telco market continues to be under pressure with low prices and sub-par returns. And telcos are offloading challenges also on the infra players. Regarding current context, the legal path will move on as expected, and we are confident on the strength of our arguments. For us, it's key to protect the integrity of the MSA as a long-term contract. We are open to optimize further the terms of the contract, particularly on new investments, and we remain committed to collaborate with our customers and identify shared value for value solution.

The industry needs material investment for densification, which may unlock growth and material opportunities for all. With this, we thank you for your attention. We aim to provide you with an updated business plan as visibility would allow it. We now open the floor to Q&A.

[Operator Instructions]

The first question is from Ondrej Cabejšek from UBS.

My question was really on the guidance, the fact that you are now able to provide targets for the year in terms of KPIs. If you could just talk about what that means, how you've kind of engaged with your customers year-to-date, and if this includes even the anchors?

And then related to that, you've been -- you mentioned that in the second half of the year, you may be able to provide a mid-term outlook. So how should we think about that statement in the sense of, obviously, you having less visibility given what's going on with your anchors. So are there any -- is there any progress in -- or should we look at this as some kind of progress in talks or a pickup in market activity? Or what is this actually driven by?

Thank you, Ondrej. Yes, the -- as we shared, the baseline plan is the result of the respect of the committed with anchor tenants. There is no additional discretionary business, reflecting the ongoing activities which are moving on in consistently with the committed revenue profile and investment profile. We -- with regards to your second question, clearly, now we have a situation where actually at operational level, we keep on working as appropriate with all our effort to make things work well and even better than before. There is a legal case which is ongoing. There is no ongoing discussion or negotiation with the anchors, though we do expect visibility gradually to improve and we would expect to be in the condition to give more clarity by the second half of the year.

And if I may follow up specifically on these 1,500 new PoPs that you expect to have this year. Can you just give us color in terms of the breakdown between the anchors and the OLOs perhaps?

Yes. In the current context, let me say that the majority of it is related to OLOs as a mix of other MNOs, utilities and IoT.

The next question is from Roshan Ranjit, Deutsche Bank.

I've got 2 as well, please. You built 30 new sites this quarter, and I think your competitor built 3. Obviously, very, very limited progress, as you mentioned, the dry market. At what point do you think the regulator or in fact, the government kind of steps in here to -- clearly, there is a lack of investment and it is dragging on the telco sector. So do you envisage a scenario where the government will step in here to move things along quite quickly because per the time frame that you have outlined, this could really, really drag on.

And my second question is regarding the discussions. I think last week, one of your customers kind of suggested that they tried to have a discussion, but the discussions weren't perhaps entertained. Is it more the topic of the discussions or there just haven't been any talks that have been ongoing?

Yes. I think the point you're raising is quite valid. The industry and the market in Italy requires investments to catch up and to accelerate on densification and digitalization. The market has been -- I think there is a strong consensus on that has been invested because it's a market which is impacted by pressure on the top line and low or very, very limited returns. I think that there is worthwhile to mention that there is the frequency renewal process, which is going on. And I think that can be a catalyst trigger, and that's probably by the end of 2026, beginning of 2027, there could be more clarity. But let me reiterate that sooner or later, the market will reaccelerate again for the benefit of the overall industry and digitalization of the country.

With regards to the second question, clearly, we have been talking, as I always shared with our customers trying to identify a solution and opportunities to optimize the contract and the relationship though our approach is based on win-win approach. On solutions which should create value for all parties. And this is for us, is the meaning of fairness and good faith. And while we have not engaged in discussions where the approach is we lose and there is net transfer value. That's what we mean when we say that we want to defend the integrity of the MSA framework.

Let me also say just to be even more specific that conversations stalled based on different assumptions of the contract, we proposed to have an arbitration actually 2x, and that has not been accepted by the customer. Just to show again on concrete and tangible terms how constructive and positive approach based on good faith we have been following across the last several months. And as I said, the legal path continues. But overall, we would prefer to focus on investments and growth, and we remain open always to collaborate with the customers to identify win-win solutions to create value for all parties. And I think that should be the ground to do so, again, based on fairness and good faith.

The next question is from Paul Sidney with Berenberg.

I also had 2 questions, please. Your 2 anchor customers and the MSAs recently set out their view that they believe and move away from INWIT is possible in 10 years. I think one said it explicitly and another didn't disagree. I feel it's easy to put it in a PowerPoint slide, but could you outline some of the practical considerations and challenges that would be involved in migrating away from INWIT in such a short time frame? And just in terms of the preferred supplier clause, I know you set this out at the end of March in your call, which is very helpful. But I just wondered a month on, have you had any further thoughts on the supplier clause, the legal implications, the robustness of that clause and what that could mean in terms of going forward if some of your customers did look to build out their own towers.

Thanks, Paul. Yes, we saw the slide as everybody and I don't want to enter into commenting on specific basis, but I would say that in general, greenfield projects in mature markets have never been done. The switching of the network as material switching costs. Operationally very, very complicated. I think that talking about our experience to do towers in urban areas such as the big Italian cities or touristic areas is extremely difficult. Also considering the regulations which have been implemented in the last 10 years by the municipalities. Also in rural areas, it's not as easy as people may think for the next-generation EU project on 5G in white areas. Actually, we -- I think it's on the newspaper today is the kind of opposition from local municipalities has been amazing. So it's from an operational point of view, from a financial point of view, from an environmental point of view is clearly very, very complex and takes a lot of effort and focus. And as I said, I think it will be more valuable and will be instead of value destruction for the industry will be value creation for the industry to focus on the new investments which are required for the densification instead of, again, investing resources for duplication and fragmentation.

With regards to the preferred supplier, is a clause whereby on the new towers in the right of the first offer and the last call. And we think that we will be able to match all the potential alternative offers based on our financial strength and even more our industrial capabilities to deploy new towers in a very efficient and timely manner. Clearly, in the last few years, we set up an organization which is best-in-class across all the chain of the machine from site search to permit to build, to maintenance. So, we think that, again, from a financial and industrial point of view, we can match all potential alternatives. So, we will be in the condition to use the preferred supplier clause to keep on working with the customers and satisfy all their new towers needs.

That's great. Can I just have a quick follow-up? Apologies. I missed the number of towers that you said. I think it was in your introductory remarks on Slide 12, but the number of new sites that you believe that Italy needs ultimately. I'm sorry, I just missed that number. I wonder if you could just clarify.

We think it's broadly in the range between 7,000 to 12,000 new towers. So let me simplify the 10,000 new towers for network densification to address the capacity needs in urban areas, the coverage and densification needs in suburban and also to provide coverage in the corridors and the transport corridors related to road and rail.

The next question is from Fabio Pavan with Mediobanca.

The first one is if you are exploring in the meantime, some opportunities to secure additional external growth? And the second question is clearly with a mid- to long-term horizon. I know there are already discussions ongoing over the future 6G network, which many think should be AI native, implying higher need for densification, low latency and densification. So are you already having some discussion on that kind? What's your view on this future demand?

Thank you, Fabio. Yes. We -- as part of the last year business plan, we laid down the direction for growth. And clearly on top of towers and real estate optimization, we are growing organically in a significant matter on what we call the smart infrastructure, so indoor coverage and dedicated coverage with important projects. Let me mention a couple of those. One is the 5G coverage of the new tube in Milan from the airport to the center done last year. And the 5G project, Smart city project in Rome, which again will bring 5G coverage across metro line and across 100 city squares, where we will bring 5G small cell readiness Wi-Fi, IoT and cameras for security. So it's a major digitalization for the smart city initiative. So that's almost organic and is embedded in our growth path. On top of that, we think that the avenues for future growth are related to the edge data center and active equipment.

Those are the 2 areas where there is potential synergies to our existing core business. And that's where we clearly we are open to talk with our customers about playing a role on the management -- ownership and management of the active equipment through the role of neutral host. Also on edge computing, yes, we do share the view that also related to 6G, we do share the view that there will be a dramatic need of computing capacity at the edge of the network. And we are very well placed on that because we have the more distributed network in the country with 26,000 point of presence across the nation, and that is a unique asset, which will be even more relevant in the mid to long term as long as 6G low latency digitalization will move on. So we are also focused on that and as consistently with our strategic plan.

The next question is from Abhilash Mohapatra, BNP Paribas.

The first one was just a clarification really to your earlier answer on the 200 sites target for the full year. Just to clarify, did you say that that's all based on committed growth? Or is there some uncommitted targets that are baked into that as well? And then secondly, just a broader question, Diego, I don't know to the extent you'll be happy to comment, but you made a reference to the uncapped CPI, how that's been viewed as a problem. Given your comments around not being ready to take a win-lose approach, should we take that to essentially mean that you would not be ready to sort of consider reversing some of those past CPIs and therefore, giving a discount on the MSA? I appreciate that's not something you may want to comment, but just wanted to ask.

Thanks, Abhilash. Yes. On the first one, the 200 towers are committed as part of the MSA and the finalization of the next-generation EU plan. On the second one, we drill down a little bit on this topic of inflation. We are -- because we understand that there is a specific clause quite, let me say, a specific feature of our MSA. And honestly, overall, let me say, we are keen and open to talk overall in the framework of a win-win approach where there can be gives and takes. The balance of give and takes can be positive for all. And that's where inflation can be part of the of the overall equation where considering the dramatic need for additional investments, I do believe that there is room again to share value among all parties.

The next question is from Andrea Devita Intesa Sanpaolo.

It's basically on discretionary investment by other operators. So I saw that in the presentation, you claim to have a positive organic growth in OLO revenues, while the arithmetic suggests a negative. So I thought that most of the discretionary was on anchor. So I'm asking the split basically for last year and then the expected for this year of the potential revenue lost from discretionary between Anchor and other telephone operators.

The project-based discretionary revenues is something which has been particularly strong on anchors considering in this specific year, considering the current context has been part of the normal business we do with the other customers and with the customers depending on the budget availability and specific timing. So there has been also in the past years up and downs, which have been absorbed overall in the overall growth path.

Clearly, this year, the combination of this impact on discretionary project-based revenues on almost and in particular, on anchors in the current market condition is visible and cannot be offset and that's why we reported in a revenue decline. The key point to underline from my side is that somehow 2026 has set a new base considering that the discretionary project-based revenues are extremely, extremely limited. So that's why from 2026 onwards, we will show also in the reported line what is the normalized revenue growth of about 3%, which together with the real estate savings will drive to a 4% margin growth over time.

Basically my question amounts to what's the proportion roughly of discretionary investments in your other operators' total revenues last year? Just to have an idea where to start from.

I think that clearly, we don't give this level of details, but you may figure it out from the minus 6% that you see on the line of the OLOs revenues. So the minus 6% is part of the termination of some project-based projects and partially offset by the recurring organic growth coming from the independents.

The next question is from Victoria Adé with Barclays.

I actually have 2 regarding refinancing. So you just mentioned during the call that you have extended your bank maturities during '27. So that's great news. Just wanted to confirm that it's both the RCF and the term loan that are extending to 2031. And then I was wondering if you have any plans on the refinancing of your upcoming Euro bond due in 2028.

Yes, I confirm that we have extended both the term loan and the RCF to 2031 for an overall amount of EUR 1 billion. Of course, the term loan was drawn while the RCF was undrawn. So gives us liquidity margin on top of the cash. And concerning the next refinancing need is the bond expiring, let's say, the relevant maturities bond expiring in October 2028 that we will refinance due time, let's say, that we have time to the end of 2027. So more than 18 months, and we will evaluate the most appropriate funding strategy also taking into account the development. But we have a strong focus on our debt maturity management with a proactive approach.

The next question is from Milo Silvestre with Equita.

I have some question about regarding the migration plan. So if you have started already discussion with Fastweb and how can we think about the maximum, let's say, duration of the immigration plan and the remuneration, should you be remunerated based on the number of actual hospitalities?

Thanks, Milos. Yes, clearly, a key pillar of the MSA is the all of nothing clause, whereby the full state, the full infrastructure is considered as a block and altogether again, based on the all-or-nothing clause. The other MSA clause is related to timing. And the MSA says that the timing issue cannot be shorter than 3 years. So it's at least 3 years. So these are the 2 corners on the pillars, very clear -- very clear in the contract and we will -- we are not talking and no discussion started with the customer on that. And -- but when it will start, that is the framework we will work on. The migration plan has to be agreed between parties. And clearly, we'll have to respect the needs and opportunities of both parties.

Okay. And how should we think about the migration plan that last 5 years? Should we expect -- I mean something which remuneration is broadly in line with the number of sites?

Listen, we -- I don't have any specific plan what is public. And honestly, I've read what is public and honestly, I have read five, I've read about 10 years. Could be also about a longer timeframe, if not everything goes well. So honestly, for me, I cannot comment because I don't have any specific detailed plan from the customers. Again, let me reiterate the all-or-nothing clause, the at least 3 years and the framework of a contract, which has 8 years renewal cycle and the fact that, again, discussion and negotiation will be in good faith from all parties and to respect and create the opportunities and needs of both parties.

Okay. Just a quick follow-up on the financing side. How do you plan to finance the payment of dividend considering that you have EUR 300 million of cash available and the cash out is roughly EUR 500 million?

Basically, the dividend, we have -- we will fund the dividend through the cash available and, let's say, the tactical and temporary use of our revolving credit facilities for the remaining part.

The next question is from Ben Rickett, New Street Research.

I had 2 questions, please. The first question, there was a report a few weeks ago that you were looking at buying data center assets from Wind Tre. I don't know if you can talk specifically about those reports. But generally, can you discuss whether you would be interested in buying or buying data center assets? And then second question, could you -- I'm just trying to understand why your OLO revenues are being impacted by this dispute? Because obviously, the OLOs are not party to the dispute. So why are you seeing an impact to that revenue line?

Thanks, Ben. On the -- let me start from the second one. Actually, yes, you're right, there is no impact from the dispute on the OLO revenues -- it's two different things. As I said before, actually, the OLO revenues have had some fluctuations also in the past related to specific initiatives, project-based initiatives that we have deployed over time also with all, let me say also that there is no correlation with the unfortunately consistency with the overall market environment, where the investments are dry and the investments in the industry from everyone, all the operators are very limited.

So it's low CapEx probably also in the context of the frequency renewal process where visibility is expected to trigger the new investment cycle.

On the first topic, we are not interested in as a potential opportunity for growth in big data center -- about strategic plan, about integrating our distributed network with computing capacity distributed at the edge of the network. We see synergies because again, we've got the most distributed point of presence across the country. We are -- it's the business model is very similar to our current one, playing a role of neutral. We can also leverage on our expertise in terms of site search, maintenance. So there are plenty of synergies sharing the view of a fully connected and digitalized society and economy where there will be the need of computing capacity and low latency distributed across the footprint. So we think we can play a role, and we will keep on assessing opportunities according to our approach, which is creating industrial synergies and healthy returns consistent with our business model based on investments and long-term visibility on revenues and cash flow generation.

The next question is from Rohit Modi with Citi.

Apologies, I missed starting a bit of a start. So if my question has been answered, my apologies in advance. Two, please. One is I understand you mentioned about the environment. I mean the investment in the industry is basically very low. I'm just trying to understand, does -- if operators get the relief on the spectrum side going forward during the second half, does that change your medium-term outlook? Do you expect more investment coming into the sector that can benefit your top line and kind of upside to your medium-term guidance given it's a baseline guidance as of now?

And second question is basically -- and apologies for ignorance, but I'm just trying to understand you have 2 processes going on, legal processes going on with the injunction process decision expected sometime in June, July. I'm just trying to understand if that decision comes in your favor, does that change anything given you have another process going on, which is kind of a bit long term goes into 2029. So what changes with injunction process? Can just give a bit more detail?

Yes. Thanks for the question, Rohit. On the first one, yes, the current market environment is dry, and we think that the frequency renewal process and may be a catalyst for the start of a new investment cycle in Italy, there has been under investment for a long time. There is the need to catch up and accelerate. And there have been discussions about getting frequency renewals at certain conditions to the operators in exchange for investment commitments that can create value for all parties and that can be, for sure, a catalyst of a new investment cycle with potential benefit for the industry and of course, for INWIT as well.

On the second question, yes, that the legal path is moving on. We are confident on our argument. And at the same time, we think that the preferred path overall for us, for our customers in the industry is somehow to move to the ground of business discussions to find an equilibrium balance with a win-win solutions for all. And that's where we keep on being open to start as deemed the right time to happen.

But any decision in June or July does it change anything from perspective just if it comes in your favor in June?

I think again that if there is more clarity and if there is more clarity about the termination being not valid and the contract being valid up to 2038, it may help, but it should help in the framework of discussions, constructive discussions in good faith with the customer. Ultimately, I think that the overall situation should be addressed not on the legal ground, but on the industrial approach, again, for the benefit of our customers, for the benefit of INWIT and for the benefit of the development of investments, network densification and digital solutions.

Mr. Minerva, gentlemen, there are no more questions registered at this time.

Thank you very much, operator. We are available for any follow-up. Thank you so much for your attention today, and speak to you soon. Thank you.

Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.

Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the INWIT Full Year 2025 Financial Results Conference Call. [Operator Instructions]. At this time, I would like to turn the conference over to Mr. Luigi Minerva, Strategy, M&A and Investor Relations Director of INWIT. Please go ahead, sir.

Good afternoon, everyone, and thank you for joining us. With me today, I have Diego Galli, INWIT's General Manager; and Emilia Trudu, Chief Financial Officer. Before we begin, please allow me to draw your attention to the safe harbor statement on Page 2. Following a brief presentation of the full year 2025 results, we will open the floor to questions. Over to you, Diego.

Thank you. Good afternoon, everyone, and welcome to our third analyst call in 2 weeks. Today, no surprises. So in a way, no news is good news. And after this, we all deserve a good long weekend.

In today's session, we share a solid set of fiscal year 2025 results with revenues up by 4% and EBITDA by 4.8%, confirming our dividend per share of EUR 0.55. A reminder of our 2026 guidance and medium-term baseline outlook as already communicated on March 19, a recap of our key strategic points of strength even in the current phase of tension with our customers.

The telco sector in Italy continues to go through a challenging moment and neutral players can help, leveraging on sharing economics to deliver investments in digitalization in the most efficient way. The MSAs are structured in a way that creates value for both INWIT and its customers, thanks to the consolidation of the infrastructure and the unlocking of sharing synergies to the benefit of all parties.

Our anchor Fast Broadband [ TIM ] sent us early termination notices. We have been clear that both heads have laid the ground and fall outside the legal framework of the MSAs. Legal certainty is fundamental not only for INWIT, but more generally for the industry in order to safeguard the ability to attract capital and execute the critical and strategic infrastructure investments that the country requires.

Despite this challenging backdrop, we have delivered our 2025 guidance and our shareholders will receive a dividend per share of EUR 0.55, which at current levels implies an attractive dividend of 7.7%. We continue to expand our asset base and another solid set of industrial KPIs in the full year. We built about 800 new sites in the year, bringing the total to about 26,000.

We added 2,800 new PoPs, tenancy ratio improving further to an industry-leading level of 2.4x. We delivered 1,600 real estate transactions, which continue to drive our efficiency gains. EBITDA was up by almost 5%, with margin up by 0.5 percentage point to 73%, supported by the lease cost efficiency plan.

Recurring free cash flow was up by 2% year-on-year at EUR 634 million. Year-on-year growth reflects also higher cash leases and financial charges, partially offset by lower cash taxes. Leverage ratio stands at 5.2x, well within our target corridor. This reflects extraordinary shareholder remuneration of EUR 500 million, EUR 300 million share buyback and EUR 200 million special dividends on top of the EUR 500 million ordinary dividend. 2025 remained intense from a commercial perspective.

We developed further the indoor coverage connectivity markets through DAS technology in a number of verticals. We continued with major projects like Roma Smart City. In summary, in the context of transition for the industry, INWIT continues to display a resilient growth trajectory and grow the asset base, affirming its leadership. We continue to support clients in their effort to improve the mobile network and stand ready to capture additional growth opportunities.

However, Q4 showed the signs of a slowing market with anchors pulling from non-committed projects. Let's now skip a few pages to Slide 11. In this page, we show the industrial and financial progress of INWIT over the past few years. We had more than EUR 300 million in revenues, growing high single digit. Smart Infrastructure revenues up more than 4.5x. Cash flow was up in the double digits, nearly 3,500 new towers, tenancy ratio moving from 1.9x to 2.4x, land ownership tripled.

All of this translated in a growing return on capital employed now exceeding 8%, confirming the soundness of INWIT business model with visible impact on our investments already in terms of cash flow generation and return on capital. Let me now hand it over to Emilia for a recap of our 2026 guidance.

Thank you, Diego. We reiterate our 2026 targets as communicated already on March 19. Revenues in the range of EUR 1.050 billion to EUR 1.09 billion, EBITDA margin of approximately 90%, EBITDA after leases margin above 72%, recurring free cash flow in the range of EUR 550 million to EUR 590 million, dividend per share at least in line with 2025 confirmed to EUR 0.55 per share.

Leverage ratio at 5.5x, consistent with the structural target range of 5 to 6x. This reflects the current challenging market environment and ongoing complexities in anchor tenant relations. CapEx in 2026 remain elevated at around EUR 270 million due to the phasing of next-generation EU cash CapEx recognition plus investment for Smart City Roma plus land acquisitions and energy programs.

The normalized 2025 total revenue space takes into account the lack of project-based noncommitted revenue components, which we have developed over time with operators capturing their discretionary flexible budget. Such discretionary budgets have been put on hold at this stage given the current context of limited budgets and conflictual relationships.

Taking into account this one-off step-downs, in 2026, we expect low single-digit revenue growth driven from the following components: inflation CPI linked based on 2025 average index at 1.4%, anchor commitment, new towers, new PoPs and [ DAS ] in line with MSA commitments, well growth with steady pace with other MNOs and IoT.

Smart Infra growth refers to DAS indoor across premium locations and projects in the smart city verticals. We have an efficient debt profile, 85% fixed, 15% floating with a current average cost of almost 3% and average bond maturity of 4.5 years. The first relevant maturity is in 2027 related to the EUR 500 million sustainability-linked term loan.

This week, the agencies confirmed our ratings with updated outlook. Fitch ratings at BBB- investment grade in credit watch negative versus previously stable outlook.

Standard & Poor's Global Ratings at BB+ with stable outlook versus previously credit watch positive. I will now hand it back to Diego for the final section of the presentation, including the medium-term outlook.

Thank you. Our medium-term baseline outlook, as communicated on March 19 consists of low single-digit annual revenue growth of around 3%. Half of it is inflation. Continued EBITDA margin expansion driven primarily by land acquisition, which could translate into an annual EBITDA growth of about 4% and all-in annual CapEx envelope of around EUR 200 million, including land acquisition, slightly more than 1/3 of the total.

Of this, about EUR 20 million would be maintenance of CapEx and therefore, go into the recurring free cash flow definition. Dividend per share of at least EUR 0.55 at the current level, a financial structural leverage ratio target between 5 and 6x. In other words, even in the unrealistic scenario in which the market remains stuck over the medium term, we would still be able to have a decent organic growth, an attractive dividend and a solid balance sheet.

The baseline outlook does not include the following potential upside: normalization of the industry dynamics, densification, both outdoor and indoor, opportunities to expand across digital infrastructure. At the same time, the baseline outlook does not include the downside risk of MSA's termination as we don't believe this is a likely or realistic outcome.

The technological context for digital infrastructure assets continue to evolve. The traffic in Italy is growing at double-digit rates until 2030 or more than 2.5x from today's level. Towers are and will remain central in this evolution, part of the digital ecosystem that goes from passive [ infraive, ] small cell, thus IoT and edge computing.

There is need for more investments in the network to close the gap. Mobile network investments cannot be postponed indefinitely. For towers or macro sites, we estimate a market potential between 7,000 to 12,000 new towers in Italy by 2030, and we plan on maintaining a leading market share on towers.

Let me now reiterate a few important points that we discussed deeply during our ad hoc call last week following the receipt of MSA termination. We have been clear in our communication to the market that both acts have no legal ground and fall upside the legal framework of the MSAs. Our network of about 26,000 sites is the result of 40 years of work of TIM, Vodafone and INWIT, where we could take the benefit of the first-mover advantage to build top quality sites in the best available locations.

About 75% of our network is not replicable. And when it comes to tower prices, it's important to compare apples with apples. It's not correct to compare fees related to the sales and leaseback transactions with pure hosting fees. MSA fees are intrinsically linked to the structure of the sales and leaseback transaction. Pure hosting fees are the result of normal demand supply competitive dynamics. In other terms, there is a captive segment of hosting that stems from the sales and leaseback transactions, which is not contestable for the entire period required to return investment.

Preserving the captive segment protects the foundation of the industry, preventing potential opportunistic behavior that would destroy value across the entire value chain. As already shared, all our prices are in line with the market. With regard to the change of control clause, that's clear in the MSA, the clause was included in order to protect all 3 parties. The only relevant change in control event is the resolution in August 2022 of the shareholder agreement between TIM and Vodafone.

TIM and Vodafone were up to the point jointly controlling INWIT. When TIM sold its stake in Daphne to Ardian in August 2022, joint control ceased with the dissolution of the shareholder agreement. TIM triggered the change of control clause and INWIT promptly notified it to TIM and Vodafone, locking in all parties for further 16 years until 2038.

Out of clarity, the Vodafone events in 2020 consisted in intragroup transfers of the INWIT stake between entities fully owned by the Vodafone Group. Those events had no impact on the joint control of INWIT. Therefore, they are not relevant with regards to the change of control clause. As a matter of fact, if this share transfer would have been relevant with regards to the change of control of INWIT to the control of INWIT, the relevant party should have launched a mandatory tender offer.

This didn't happen, obviously. We have clear and consistent legal opinions from the best law firms in the country on this. Let me now conclude. The towers business model is based on long-term contracts that create value for all parties, thanks to the sharing economics and network efficiency. The Italian telco market continues to be under pressure with low prices and subpar returns.

Telcos are offloading challenges on the infra players, and this is -- and this was already visible in the final quarter of 2025. Still, we delivered the 2025 guidance, including the EUR 0.55 dividend per share, which implies an attractive dividend yield. Our 2026 guidance and the medium-term baseline outlook reflect the current challenging market conditions. Even in the unrealistic scenario in which the market remains stuck over the medium term, our baseline medium-term outlook means that we would still be able to have a decent organic growth, an attractive dividend and a solid balance sheet. The baseline outlook does not include the following potential upside, normalization of the industry dynamics, densification opportunities to expand across digital infrastructure.

At the same time, as just said, the baseline outlook does not include the downside risk of MSA termination as we don't believe this is a likely or realistic outcome. We confirm that we continue to be open to constructive conversation with our clients.

From our perspective, it's key to protect the integrity of the MSA as a long-term contract. We are open to optimize further the terms for new investments, and we aim to achieve a win-win outcome in terms of positive net present value and business development.

With this, we thank you for your attention, and we aim to provide you with an updated business plan likely enough to as visibility allows it. We will now open the floor to Q&A.

This is the Chorus Call conference operator. We will now begin the question and answer session. [Operator Instructions]. The first question is from Roshan Ranjit, Deutsche Bank.

My question is quite simple. We've seen quite a lot of news flow over the last 1.5 weeks. And Diego, you mentioned this constructive dialogue. So since we've had the filings for the court hearing from yourself and from Swisscom, have you had dialogue with Swisscom on the MSA negotiation since. So over the last, I guess, week, have you been in discussions with them?

Yes. Thanks for the question. No, we are not having dialogue at this stage.

The next question is from Rohit Modi of Citi.

I have just one question, and apologies if you already replied to this in previous calls, but this is regarding the migration phase. Hypothetically, if both the [ MSAs ] managed to terminate the contract, are there any rights that INWIT has in the migration phase given that they'll continue to use the remaining towers as a part of migration period for foreseeable future or INWIT does have a right to terminate the contract and ask them to vacate the sites?

Thanks. On the migration plan, the framework is about a plan which has to be agreed between parties. The time is not shorter than 3 years. And all this will be in the spirit and logic and content of the all or nothing close. Let me also take the opportunity to highlight which -- the fact that we stress, which is about the lack of alternatives to our network and the fact that we have the majority of our sites, which are actually not...

[Operator Instructions]. The next question is from [indiscernible].

One question concerning 2026 guidance. Here, I would like to, let's say, just have a little bit of color concerning the discretionary spending that you're assuming on 2026 level of revenues.

Thank you. So on 2026, the base case is actually consistently with the overall baseline case is basically that the anchor tenants invest only on the committed contractualized initiatives. And we have a continued steady growth with the other customers, with the [indiscernible] with the other MNOs, and we continue gradually to develop and grow [indiscernible] in coverage to DAS and dedicated projects.

Okay. And the discretionary revenues that will have a negative contribution in 2026. What's -- I mean, this level of revenues in 2026, I mean, is that derisking for 100%? Or is it something still there?

Yes, the discretionary revenues is -- there is no discretionary revenues basically with the anchor tenants or all. So yes, it's actually the [indiscernible].

The next question is from Mathieu Robilliard, Barclays.

I had a question. I'm looking at Slide 14, and you show some growth driven by anchor commitment and all growth. I don't know if you can quantify that in terms of sites, how much that represents? And also, are the anchor commitments fully part of the MSA, the existing MSA? Or is it on top of it, it's a different contract that could go whatever happens with the legal decision?

Yes. Thanks for the question. In terms of towers, we are talking about a few hundred significantly lower than the last year where actually we deployed at about 800 towers per year.

In terms of revenues, we are talking here about the MSA committed revenues. So contractualized contracted committed revenues where there is no dispute about. So it's -- I can say it's clean and certain and committed and in progress.

And if I could follow up. I mean, I think you had also some contracts with Open Fiber or maybe FiberCop in terms of growth or in terms of deployment of site for FWA. That's the topic #4 on your slide deck, right, all our growth?

Yes. Basically, the OLO growth is mainly the other MNOs such as Iliad, some of Wind3, as well as some fixed wireless access for Open Fiber. The main component is basically the MNOs component. In terms of revenues, it's the main component, as I said, is the other MNOs component.

Okay. And that is basically increasing tenancy rather than building sites. Sorry, very basic question, but...

It's basically secondary tenants is co-location on existing sites.

The next question is from Giorgio Tavolini, Intermonte.

The first one is on the ground leases saving of EUR 10 million in Q4. I was wondering if it's related to a specific transaction. And back to [ Milo's ] question on discretionary revenues, how much was the exact amount in 2025 since I see the block in the presentation in the bridge for the full year 2026 guidance bridge?

Yes. On the discretionary revenues is on the few [indiscernible] range. And with regards to the lease cost, lease costs are continuously optimized through the program of land buyout as well as renegotiation of lease contracts and that is able to offset the impact of increasing asset base and inflation.

Okay. And for the discretionary revenues in 2025?

A few tens of millions.

A few tens of millions...

The next question is from Ondrej Cabejsek, UBS.

I have 2 questions, please. One is on the CapEx. If you can kind of walk us through the new level of roughly EUR 200 million as going back to the previous strategy update, the guidance was for CapEx to be closer to EUR 240 million over the midterm and higher in the near term.

So I guess this is obviously the step down would be related to what's going on with the anchor tenants and therefore, lower growth on the top line. But maybe if you can give us a bit more detail around which of the envelopes from the full year '24 strategy update you are not cutting on and which envelopes of CapEx you are actually cutting on?

And maybe the second question, if I may, are you a party to the, I guess, consultation process around the spectrum renewal, which I believe is going to be kind of finalized in the coming months or in the summer and then potentially making it into the budget in kind of late 2025? And if you are, how is the kind of reception of the regulators or authorities around the fact that maybe part of the investment that would -- or rather the fact that if there is a discount given to the anchors part of that capital that they are saved and they're supposed to be rolling out into new networks, they would potentially be directing towards duplicating infrastructure that is already there that you are providing. So are there already kind of some signals that this is not something that the authorities would be looking favorably at?

Thanks for the questions. With regards to the CapEx split, actually, the very relevant component will remain to be the land, land acquisition, which will account broadly 35% of the total.

Then there is, let me say, half of the total envelope, which is related to growth, including CapEx for towers, for the smart infra [ so gas ] and special projects and the energy project. Then we have broadly 10% related to maintenance. Compared to the previous guidance, we have embedded in the current baseline outlook a lower number of towers, a significantly lower number of towers, and this is the main difference compared to the previous plan.

With regards to the frequency renewals, that's an interesting topic. We clearly -- the industry, as we said, is under dramatic pressure. So we think it's relevant and it's important to have the frequency renewals which support the industry. Clearly, we think it's important that the support to the industry is to the whole value chain to the whole -- to the -- all operators, both the, let me say, the service cost as well as the infra cost.

And so that's important in order to not only support the new investment, but also to preserve the existing infrastructure and the investments which have already been done. Clearly, in this context, but in general, as we said, we don't think that the duplication of infrastructure is an efficient way and creates efficiency and value in the industry.

Actually, we think that consolidation of infra is the way to build efficiency within the industry. So continuous scale and optimization and consolidation will drive as did in the past, will continue -- is the way to continue to drive efficiency in the overall industry to the benefit of all parties.

In terms of visibility, we think that there will be more visibility on the process in the second part of the fiscal year.

[Operator Instructions].

If there are no other questions...

We do have a last question from [indiscernible].

I just had one follow-up. So you were asked about the dialogue with Swisscom to which there hasn't been any.

I just wondered if there have been any dialogue with Telecom Italia. And I guess maybe following up on that, is the lack of dialogue because you are simply dealing with this in a legal fashion and it's for them to negotiate? Or any color would be helpful.

Yes. I think that we received the termination notice between last, I think, Wednesday and Sunday or Monday, whatever.

So just a few days ago. And clearly, we have been busy on filing responses and activating all the relevant legal steps. And now there is Easter, that's welcome. I think there is time for everything. For the time being, the dialogue has not been activated yet. But clearly, we are always open.

Gentlemen, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.

Thank you very much. So let me just thank you all of you for your attention and remark that we are confident that a realistic win-win outcome is actually achievable with our anchors.

And with that, we wish you all happy Easter. Thank you, and happy Easter again.

Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.

Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the Third Quarter 2025 INWIT Financial Results Conference Call. [Operator Instructions]

At this time, I would like to turn the conference over to Mr. Fabio Ruffini, Strategy, M&A and Investor Relations Director of INWIT. Please go ahead, sir.

Good morning, everyone, and thanks for joining us. With me today are Diego, INWIT General Manager; and Emilia, CFO. Before we begin, allow me to draw your attention to the safe harbor statement on Page 2.

As usual, following a brief presentation, we will be happy to take your questions. Over to you, Diego.

Thank you, Fabio, and good morning, everyone. It's a difficult day for INWIT shares following the updated growth expectation in the '26-2030 period. It's important for us to answer the key questions you may have and lay out the priorities going forward. We expected to grow at the low end of the target range with revenues at about 4% compounded growth rate, more than 50% of which is contractually committed via inflation and Anchor MSAs alone. The update impacts noncommitted sources of revenues, densification outdoor and indoor, which are postponed. We are also factoring in slightly lower 2021 inflation, up 1.5%.

We acknowledge the difficult market environment with protracted financial challenges of Italian telco sector, focused on maximizing efficiency, limiting investments to the bare minimum. In the previous outlook, we implicitly assumed that over the course of 2025, there would have been initial signs of an improved market structure following transformative transactions in 2024. This improvement has yet to materialize.

Having said that, Q3 results confirm the resilience of the business, expanding all industrial and financial metrics while investing in critical infrastructure from NextGenerationEU in rural areas to Roma Smart City. Today, it's also important to affirm the structural outlook for digital infrastructure investments in Italy with a need to catch up since infrastructure investments cannot be postponed indefinitely.

INWIT plays in a concentrated market with high barriers to entry, holding 2 competitive advantages, the best assets and locations in the market and a true industrial approach to deploying assets from the ground up. In this market context, we are conscious of our role as an enabler of investments and a driver of efficiency for operators, facilitating densification through sharing economics. This will be even more important in case of additional coverage obligations currently being discussed, linked to the extension of mobile frequency post '29.

Moving to main trends of the quarter on Page 4. The key figures for the quarter, revenue growth by 4.1%, EBITDA after lease up by 4.4% with margin up 73%. Recurring cash flow up EUR 170 million with 69% cash conversion. In October, we completed the first tranche of EUR 300 million share buyback and successfully issued the company's first sustainability-linked bond.

In summary, INWIT continues to be resilient in a challenging industry environment, acting in a proactive way on the levers under our control already to facilitate further network densification.

Now I will turn it over to Emilia for a more detailed review of the results.

Thank you, Diego, and good morning, everyone. On Page 5, the focus is on new towers. Q3 displays a continued high volume of new sites, 180 across 2 programs, MSA commitment for TIM and Fastweb-Vodafone and the 5G NextGenerationEU program, where we are on track with the milestones. New towers are expected to continue to be the main network requirement of our clients due to data traffic growth, increasing capacity needs, the transition to 5G in suburban areas and the need to cover approximately 9,000 kilometers of roads and railways currently lacking adequate quality connectivity.

Moving to total costs on Page 6. 670 new PoPs were added during the quarter, bringing the total 9 months figure to more than 2,000. This is consistent with full year target of approximately 2,500 new PoPs. Of the new additions, 260 PoPs were delivered to TIM and Fastweb-Vodafone and 410 to other clients, further diversifying INWIT's client base. Within other clients, we recorded steady pace with other MNOs, Iliad in particular, stable adds from FWA and solid demand from utility companies for IoT gateways for smart grid applications.

Next, on Page 7, we review smart infrastructure. Revenues in the first quarter were up double-digit year-on-year to more than EUR 22 million. Growth was driven by the addition of 30 new DAS locations across multiple verticals and higher tenancy ratio across the more than 700 locations we serve. INWIT covers a growing portfolio of critical infrastructure assets. Latest additions include the Roma Smart City project, one of the largest in Europe, DAS and tunnels for the upcoming Winter Olympic Games between Milan and Cortina and international corridors connecting Italy to France and Austria and Germany. Looking ahead, demand for dedicated indoor connectivity is expected to remain structurally solid across verticals, including transportation, hospitality, healthcare and leisure.

As you know, revenues come from 2 client categories: MNOs based on their ability to fund additional coverage projects via recurring fees and location owners where demand is solid, though primarily based on project-based revenues.

Next, we review the P&L. Revenue growth stood at 4.1%, in line with the 2025 guidance midpoint. The drivers, as mentioned, were new PoP additions for Anchors and OLOs as well as double-digit growth in smart infrastructure and inflation at plus 0.8%. EBITDA margin remained stable at 91.3%, while the main efficiency lever continues to be lease costs. 360 real estate transactions in the quarter supported EBITDA after lease's growth of 4.4% and margin expansion from 72.8% to 73%. This partially offset the impact on cost of inflation and the higher asset base for which we pay lease costs. Lastly, net income increased by 5.9% to EUR 92 million, reflecting the expected trends in D&A, stable interest expenses and taxes.

Moving to the cash flow on Page 9. Recurring free cash flow amounted to EUR 170 million in the quarter or 69% cash conversion. In the quarter, we recorded limited recurring CapEx, no cash taxes, which are due in Q2 and Q4, positive net working capital in line with full year '25 guidance.

Lease payments were higher year-on-year, mainly due to the end of the VAT split payment mechanism. This is in line with full year expectations of about EUR 215 million lease cash out, including the effect of VAT split payment. Reported leverage stood at 5x net debt to EBITDA, reflecting the completion of the first tranche of EUR 300 million of share buyback plan with approximately EUR 180 million in the quarter. Additionally, we're pleased to report that in October, we completed 2 debt capital market transactions with the first sustainability-linked bond issuance and the partial buyback of the 2026 outstanding notes. This further strengthened INWIT's debt structure, extending its maturity profile and confirming solid market interest.

With this, I hand it back to Diego. Thank you.

Thank you, Emilia. On Page 10, the updated expectations for 2026-2030. Growth sits at the low end of the range with an impact of about EUR 15 million to EUR 25 million progressively versus the midpoint revenues. This is driven by the lower expectations for non-committed revenues, mostly densification projects indoor and outdoor, which we expect to be postponed or reduced by our main clients. As you know, we invest on the basis of committed revenue streams, so a project postponement also means a delay or reduction in CapEx. This impact is partially factored in, in our updated leverage guidance. Together with a mix and phasing of industrial KPIs, there will be a more granular update with full year '25 results.

Through 2030, we expect to deliver 4% revenue growth per annum, of which more than 50% is contractually committed, and progressive margin expansion and leverage reduction. Committed revenues come from inflation, more than 9% combined over the next 5 years, MSA contracts, particularly new PoPs on new sites and the solar energy projects and all this provides a contractually secured path to growth. Non-committed growth is less than 50% of total growth and comes from OLOs and additional densification revenues, both outdoor and indoor. Today, we are also confirming the dividend policy and capital allocation announced this past March.

A few concluding remarks in the next slides. Today's presentation reflects an updated macro and industry view, stemming from current industry challenges. In this context, INWIT is expected to grow at 4% for revenues and 5% for margin. In any case, we continue to believe on the structural outlook for digital infrastructure in Italy, which is confirmed there is a need to catch up, which is an opportunity. INWIT continues to focus on all levers under our control, both on revenues and costs, affirming our role of an efficiency driver for operators, facilitating densification through sharing economics.

With this, I thank you, and we are now ready for the Q&A session.

[Operator Instructions] First question is from Roshan Ranjit, Deutsche Bank.

I guess my question is around the evolving Italian landscape, which is something I think you've talked about now for the last few quarters. And if we think across Europe, what we've seen is where markets have evolved, there has been these behavioral remedies and the want for further densification of networks. So I guess my question is, how easy is that to apply to the Italian market given the already high tenancy ratios and also the kind of more restrictive EM limits, which whilst we have seen the rules change, we haven't actually seen any practical changes in the emission limits leading into kind of more PoPs in smaller areas. So anything you could say around how the evolving MNO landscape can benefit you even though that visibility is maybe a bit more limited than before?

Thank you, Roshan. Yes, I think that the key point is that in Italy, the digitalization and 5G rollout is behind all peers and European and international standards. There is a need to catch up. And this is recognized by all operators in the market. So there is a significant need for additional densification, both outdoor and indoor. This need currently goes -- can I say, is not materialized because there are financial constraints in terms of budget limitation and return on investments. We think that the market has evolved already in 2024 in the right direction. That's not been enough to continue to evolve towards a more sustainable market.

And also, let me say, initiatives and the consensus around the new license renewals in 2029, which there is a scenario where the renewal is at no limited cost against commitment to invest, these kind of things do recognize the need to invest, do recognize the need for a more sustainable industry and go absolutely in the right direction.

In case of densification, our role is clearly to do it in an efficient manner through the sharing economics and through the industrial capabilities. So in short, the market is behind the industry. There is a need of densification and INWIT is a key player to benefit from it building in an efficient manner, shared infrastructure, outdoor and indoor.

Great. If I could just follow up, you -- I think you -- in terms of the densification, you've kind of given this target, I think it's 2.6x by 2030. So is that -- does that require an easing or further easing of any regulation? Or is that under the current regime?

Yes. No, there is no impact from regulation. This is consistent with current regulation.

Next question is from Fabio Pavan, Mediobanca.

I would have first a follow-up on what you were saying, Diego, about the renewal of the license. So do you have any visibility on how long this discussion may take? Do you have already managed to discuss with regulators about this potential new scenario?

And then the question is, clearly, you have managed to derisk the target and providing us a very solid equity story. What could be, if I may, upside from here in your view? So higher demand, which at some point, given 5G stand-alone coverage is very low rather than deciding to speed up in capturing opportunities in adjacent businesses. So it's open question, I leave that to you.

On the frequencies on the licenses, discussions are ongoing. I think there have been, let me call, public declaration from the regulator, which have been supporting the scenario. So I think there is a process on forming an overall consensus on this scenario that, again, from our perspective, makes a lot of sense to the benefit of operators and the entire value chain, the entire industry.

In terms of upside, yes, I think that the updated guidance reflects timing in the development of the industry towards what we just call more densification. That means higher demand, higher number of new towers to densify -- to cope with the additional capacity needs and the additional data traffic in urban areas, additional towers to densify the suburban areas as soon as 5G stand-alone advances and new towers and dedicated coverage for the transport corridors, rail and roads where the quality of connectivity is clearly requires strong improvement. On top of that, indoor, there are thousands of locations where connectivity is not up to the use of data and digital needs.

So that's, I would say, is the industrial key upside in terms of higher demand from the operators to deploy a digital ecosystem to advance on 5G and this again means more towers, more point of presence, more inter coverage. That's our core business that in these days, we do see under pressure because of the budget limitations. But going forward, we do see that investments cannot be postponed forever.

Next question is from Rohit Modi, Citi.

Some of them have been answered. So just one question, basically clarification on the committed revenues baked into the guidance. If I remember correctly, at start of the year, you mentioned more than 60% of the guidance is based on the committed revenues you have with the operators. Now slide shows that it's more than 50%. Just trying to understand if there's any change in terms of your committed revenue profile there.

Yes. No, thanks for the question. Yes, we -- the committed revenues made up of inflation and the MSA agreements continued as planned, and that's more than 50% of the overall growth. Where the -- we have updated our view is on the noncommitted bit that, again, is related to the to the densification, so the additional point of preference, both outdoor and indoor. In the business plan, in the guidance, we had about 1,000 additional towers, which were not committed. We think that, that is the bit that will take more time to materialize. And by 2030, we think there will be probably around 400 towers less, and this accounts for about EUR 10 million.

On top of that, the outdoor -- the indoor densification, we have been developing this market growing very fast. But again, there are budget constraints from the operators at this stage, and we do expect the remaining bit to come from lower indoor location. We would expect that about 20% lower location compared to the March guidance. So these are the 2 main bits, towers and indoor cover solution projects.

Next question is from Andrea Devita, Intesa Sanpaolo.

So my question is basically on the change in FY '30 guidance because at the end, I clearly understand that on 2026, you have visibility of lower revenues. But I just want to understand whether you just applied, let's say, a mechanical new baseline for 2030, assuming that no catch-up eventually takes place. So 6 months ago, you had visibility on 2030 and now it is lower. Just whether it is structurally or you now do not assume that any catch-up, which should have taken place in 2025 will not take place ever in the next 4 years?

Yes. Yes, I think that as I shared before, what is -- we strongly believe in the need for investments in the sector, in the industry, which has been under-invested for a long time, and that's not only our view. This is the view overall in the market, in the industry as reflected in statistics. The industry has been under pressure and is under pressure in terms of financial return, and that has reduced the investments.

In 2024, the industry has started changing with the telecom separation, the Fastweb-Vodafone transaction. We think that overall, the industry has gone into the right direction. And our assumption was that already starting from the end of 2025 with the impact in 2026, there would have been an acceleration of investments. Now talking with customers, in terms of commercial discussions, planning the next year activities, the rollout plan, securing locations that's clear that the emphasis on -- from the customers is on efficiency. So there is still a short-term focus on recovering efficiency on optimizing cost. And clearly, our growth is reflected in rental fees to customers, which means additional OpEx for customers. And this then faces the budget constraints of our customers.

So the fundamentals are -- and the fundamental needs for additional investments are confirmed from our point of view. The timing is different. And this impacts for sure by 2026. But then we think that the -- I can say the phase, the timing for the development will take anyway a little bit longer. We don't see at this stage the view of an acceleration, which will compensate the initial shortfall. So in short, term impacted by budget limitation, medium, long-term growth with potential upside to what we have embedded in the current guidance update, growth coming from densification outdoor and indoor.

Next question is from Oba Agboola from UBS.

Can you hear me?

Yes.

Just on what you're hearing from customers, you mentioned customers are looking to be more efficient, so postponing investment. Are you hearing anything in terms of potential renegotiation of contracts? I know this is something Fastweb-Vodafone mentioned on the efficiency side. So just any update on how you see that?

Yes. We -- Clearly, we continue to talk with customers on recurring on an ongoing basis. We believe the MSA is a strong contract, creates value, has been creating and creates value for all parties involved. So we are very happy to continue to discuss with customers about potential development, additional investments to create value for all. And on the basis of additional investment cycle, we -- our mission is to create efficiency to make most -- the best effort, again, to be efficient and to share the benefits of efficiency with our customers. So that's our focus. The MSA is -- the MSA.

Next question is from Fernando Cordero, Santander.

It's basically related on the guidance, and you have been updating to the low end of the previous revenue guidance. And this low end is falling to the rest of the main lines of the P&L. And what I'm a little bit or what I would want to understand is why you have maintained the EBITDA and EBITDAaL margins in your updated guidance despite the fact that, for example, in the third quarter, we have seen the operational leverage in your business slowing a bit, particularly on EBITDAaL side. So in that sense, are you reflecting in the updated guidance any increase -- any effort increase in buying land? Just to understand why the update on revenues is not impacting margins?

Thanks for the question. Overall, on the cost side, we continue our plans. And overall, the real estate programs and activities are on track. There is -- in the quarter, there is a specific topic in terms of comparison against last year same quarter. But overall, the ground lease cost is on track. Therefore, we are confirming our view on that.

Next question is from Giorgio Tavolini, Intermonte SIM.

Two questions, please. The first one is on M&A. In particular, we recently heard about rumors on a potential tie-up between Iliad and Wind3. But more in general, we know your position regarding consolidation, which is a neutral to positive event. But I was wondering if you can add more color on Cellnex remarks regarding the fact that this kind of consolidation may temporarily weigh on tower growth cash flow due to the higher flexibility granted to the operators during the integration phase. So in the very short term, should be negative event then in -- over the long -- medium to long run should be pretty positive given the more investments and more network upgrades and better financial shape of the merged entity.

The second question is on 5G stand-alone. Is it to assume to expect that the near-term investments from the MNOs will mainly prioritize active equipment upgrades on existing sites rather than, let's say, new passive infrastructure, new sites for the network densification?

Thanks, Giorgio. Yes, on potential consolidation, I think that the consolidation is a mean to get to a more sustainable industry structure and to enable and abilitate additional investments. So yes, I believe that the consolidation making the market more sustainable will drive additional investments. And so there is a positive impact on the overall value chain, including the tower companies in terms of additional infrastructure.

When talking about consolidation, it's also important to highlight our MSA protections in terms of all or nothing and active sharing protection.

With regards to the second point in terms of active versus passive, yes, what you say makes sense. But what is important to highlight is that the active upgrade then drives the need for additional point of presence. So the sequence is quite short between one and the other. And the key point is, again, is investment for network improvement on clearly both radio active and passive. That's what is needed in the market. And we think it will develop even if a little bit later than originally expected.

Next question is from Milo Silvestre, Equita.

I have 2 questions. The first one concerning the recent, let's say, agreement between Cellnex and Vodafone on 1k hospitalities. So here, if you can elaborate on that point and if it may have, say, an impact on your expected discretionary investments?

And the second one, considering the limited investment momentum on telco infrastructure, if we may expect an acceleration in net new verticals such as data center?

Yes. Maybe come back to the second part of the question, I'm not sure I fully understood. The -- yes, no, the announcement is related to a renewal agreement, and there is no impact on INWIT. Again, let me remind the MSA features, which include the all or nothing clauses and the preferred supplier clause as well. So no impact on us.

The second part of the question, sorry, if you can kindly repeat.

Yes. And if, let's say, considering the weak momentum on new tower or densification investments, if you are, let's say, considering entering new verticals such as data center?

Okay. Yes, thanks. As part of our strategic plan, we have 2 potential areas of development where we think our companies can make a difference consistently with the current existing model. One of those is the edge data center, the far edge. So clearly different from the hyperscaler data center, which is a different business. But when the computing capacity is needed at the edge of the network, then clearly, we have the infrastructure, which is distributed in the country, which is connected with fiber and energy. So we have both the infrastructure and the business model, which may allow some investments on edge far data center.

The second -- let me take the opportunity to mention also the second area, which is the involvement of INWIT tower companies in the active equipment as a player as a neutral host to own and run and manage the active equipment, again, to provide a more efficient operating model and to bring additional efficiency to the operators.

These are 2 areas of potential developments, of potential upside for the company based on the strength of our financial position and the ability to invest and based on the industrial capabilities that we do have. So in short, yes, potential opportunities for the medium term.

Next question is from Riccardo Romiati, Aurelia.

Just one. Given that the lower growth from noncommitted revenues probably also implies slightly lower CapEx, does this, together with the lower share price, provide an opportunity for further share buyback? And how do you think in general about shareholder remuneration going forward?

Yes. Thanks for the question. We have the EUR 400 million buyback program already approved, EUR 300 million just been finalized. We have EUR 100 million for the next month. And actually for Q1 and in a few days, in a couple of weeks, we will have the special dividends for EUR 200 million. So that's the current shareholder remuneration, and that shows the way we do think about shareholder remuneration, which is a mix of dividend increase and topped up by either buyback or special dividends, and that's the way we will continue to assess the shareholder remuneration.

And sorry, is the share price today, do you see that as an opportunity to further boost this?

Yes, absolutely. I think it's -- if I may, clearly, let me say that I strongly believe the current share price does not reflect the fundamental value of the company, the solidity of the business model, the cash generation and the ability to invest and to fuel further growth. So I -- for sure, the share price is below the fair value of the company.

Next question is from Graham Hunt from Jefferies.

Just on what could see the industrial backdrop improve. Is it just -- is it that we're just waiting for consolidation really? Or could you maybe expand on other situations which maybe could see your customers expand their budgets a little bit or we could see a pickup in growth? Just trying to explore different scenarios there. And on that, we've seen one consolidation, and we are still waiting for any improvement. So just wondering sort of if you could reflect on why that is? Why are we not seeing a pickup from Vodafone-Fastweb?

Yes. I think that the industry may improve across different levers. Starting from the top line, I think the pricing has been a little bit more rational in the last quarters, and that's clearly a key to support the industry a little bit of rationalization on consumer and there is the growth in enterprise, which is a significant opportunity for the telco industry to grow revenue. That's -- I think it's considering the overall digitalization environment, I think it's an opportunity which is at the beginning and operators will be in the condition to materialize in the next years.

On cost and investments, let me mention that the energy cost is particularly high on the industry, and there are initiatives to support lower cost on the energy front. And the other element that I did mention before is about the frequency and the renewal of the frequency with no limited cost in exchange of investments together with additional investments and coverage commitments will be a way to support the industry to get better returns and to start the investment cycle and the positive cycles of investments, services and top line growth.

Mr. Ruffini, gentlemen, there are no more questions registered at this time.

In this case, thank you, everyone, for connecting. Have a good rest of the day.

Thank you.

Ladies and gentlemen, thank you for joining. The conference is now over. You may now disconnect.