Summary of Orange (OTCPK:ORAN.Y) 2026 Capital Markets Day Company Overview - **Company**: Orange S.A. - **Event**: 2026 Capital Markets Day - **Date**: February 19, 2026 - **Key Focus**: Presentation of the new strategic plan "Trust the Future" and review of past performance under "Lead the Future" plan Core Industry Insights - **Industry Context**: The telecom industry is facing challenges such as growing data demand, technology shifts, rising cyber threats, and high expectations for trust and security [2][8] - **Customer Base**: Orange serves over 340 million customers across 26 countries, with a strong focus on connectivity and customer loyalty [4][5] Strategic Plan: "Trust the Future" - **Core Convictions**: - Connectivity is essential for responding to data demand and security concerns - Trust is a key driver for customer loyalty and engagement - Leveraging distinctive assets such as a strong brand and infrastructure [2][9] Financial Performance - **2025 Results**: - Revenues exceeded EUR 40 billion - Free cash flow reached EUR 2.8 billion - Total shareholder return grew by 82% from end 2022 to end 2025 [5][7] - **Debt Management**: Maintained a solid balance sheet with a net debt to EBITDA ratio of 1.8x [7] Strategic Ambitions 1. **Customer Intimacy**: - Aim to grow the customer base by 40 million by 2028, reaching over 380 million customers - Focus on reducing churn rates, with a target of improving NPS (Net Promoter Score) to 40 by 2028 [15][17] - Implementation of AI-driven customer value management to enhance customer interactions [18][19] 2. **Innovative Growth**: - Targeting additional EUR 500 million in revenues from new growth initiatives by 2028 - Focus on B2B and B2C segments, with a strong emphasis on cybersecurity and digital services [21][23] - Plans to expand Orange Money and Maxit services in Africa and the Middle East [54] 3. **Excellence at Scale**: - Commitment to operational efficiency and leveraging AI across operations - Expected decrease in CapEx-to-sales ratio to around 14% by 2028 [30][31] - Focus on network transformation and decommissioning outdated technologies [30][31] Market Dynamics - **Africa and Middle East**: - Strong growth potential with a young population and increasing smartphone penetration - Revenue growth of 12.2% and EBITDA growth of 13.9% in 2025 [52][55] - Plans to double the fiber customer base by 2028 [53] - **European Market**: - Expected low single-digit revenue growth with a focus on customer loyalty and personalized offers [57][58] - Continued investment in cybersecurity and cloud services [61] Acquisition Strategy - **MasOrange Acquisition**: - Binding agreement to acquire the remaining 50% of MasOrange for EUR 4.25 billion, expected to close in H1 2026 - This acquisition is anticipated to significantly enhance cash generation and expand market leadership in Europe [68][69] Employee Engagement and Culture - **Leadership Changes**: 60% of top 300 managers have changed roles or are newly appointed, indicating a dynamic organizational culture [11] - **Employee Commitment**: 81% of employees expressed pride in working for Orange, with a focus on talent development and upskilling [12] Environmental Commitment - **Sustainability Goals**: - Target to reduce CO2 emissions by 45% by 2030 and achieve net zero carbon by 2040 [14] - Commitment to digital trust and economic empowerment, particularly in underserved regions [14] Conclusion - **Future Outlook**: Orange is positioned to leverage its strengths in connectivity and trust to innovate and grow in a rapidly evolving market, with a clear focus on customer intimacy, innovative growth, and operational excellence [8][9]

Core Insights - The company successfully completed its "Lead the Future" strategic plan for 2023-2025, achieving all objectives set for 2025, resulting in a simpler, stronger, and more efficient organization [3][4]. Financial Performance - Revenues for 2025 reached €40,396 million, reflecting a year-on-year increase of 0.9% (+€374 million), driven by a 2.2% growth in retail services [8][56]. - EBITDAaL increased by 3.8% to €12,470 million, surpassing the target of at least 3.5% growth, with significant contributions from Africa & Middle East (+13.9%) and Europe (+3.2%) [9][56]. - Consolidated net income was €1,139 million, a decrease of 60.7% year-on-year, primarily due to increased costs and impairments [12][56]. - Adjusted net income was €3,094 million, down 5.7% from the previous year [15][56]. - Organic cash flow from telecom activities was €3,653 million, up 8.3% year-on-year, while free cash flow all-in was €2,793 million, down 6.6% [16][58]. Market Position and Growth - The company maintained its leadership in a competitive European market, with a total customer base exceeding 340 million, and Africa & Middle East recorded its eleventh consecutive quarter of double-digit growth [4][7]. - A binding agreement was signed to acquire full ownership of MasOrange, positioning Spain as the second-largest market in Europe for the company [5][6]. - The PremiumFiber joint venture with Vodafone and GIC began operations, becoming the largest FiberCo in Europe with over 12 million access lines [6][7]. Operational Efficiency - The company achieved a 30.2% increase in EBITDAaL minus eCAPEX, reaching €6,262 million, supported by operational efficiency measures [10][25]. - eCAPEX was reduced by 0.4% to €6,208 million, representing 15.4% of revenues, aligning with the company's eCAPEX discipline objectives [11][57]. Regional Performance - In France, revenues decreased by 2.1% to €17,473 million, with retail services excluding PSTN growing by 0.6% [22][23]. - Africa & Middle East revenues increased by 12.2% to €8,427 million, driven by strong growth in mobile data, fixed broadband, and Orange Money [14][28]. - European revenues rose by 2.2% to €7,263 million, primarily due to retail services growth [34][56]. Sustainability and ESG - The company exceeded its GHG emissions reduction targets, achieving a 49.3% decrease in scopes 1 and 2 emissions compared to 2015, and a 16.4% reduction in scope 3 emissions compared to 2018 [19][20]. - The company also surpassed its target for digital support and training, benefiting over 3.3 million individuals between 2021 and 2025 [20].

Core Insights - Orange reported solid third-quarter results for 2025, leading to an increase in annual EBITDAaL growth guidance to at least 3.5% [6][8][10] Financial Performance - Group revenues for Q3 2025 reached €9,993 million, a 0.8% increase year-on-year, with EBITDAaL growing by 3.7% to €3,437 million [2][40] - eCAPEX (excluding licenses) increased by 8.3% in Q3 2025, totaling €1,466 million, driven by investments in growth areas [2][10] - EBITDAaL after eCAPEX was €1,971 million, reflecting a 0.6% increase [2][41] Regional Performance - Africa & Middle East revenues grew by 12.2% in Q3 2025, driven by strong retail services growth of 13.1% [20][21] - France experienced a revenue decline of 3.7% in Q3 2025, attributed to competitive pricing pressures and trends in wholesale services [16][19] - Europe saw a revenue increase of 4.7%, supported by a strong performance in retail services and IT & Integration Services [24][25] Customer Growth - The total customer base surpassed 300 million globally, with 8.2 million new customers added in Q3 2025 [3][8] - Mobile Financial Services, particularly Orange Money, reported 44 million active users, contributing to value creation [5][28] Strategic Initiatives - Orange announced a non-binding joint offer with Bouygues Telecom and Free-Groupe iliad to acquire a significant portion of Altice's activities in France, aimed at enhancing network resilience and cybersecurity investments [4][5] - The company is focused on operational efficiency and cost control, which have positively impacted EBITDAaL growth and margins [6][10] Future Outlook - The company aims to maintain double-digit EBITDAaL growth in the Africa & Middle East segment for 2025 [23] - Orange plans to present the evolution of its "Lead the Future" strategy at the Capital Markets Day scheduled for February 19, 2026 [7]