Telekom Malaysia Q1 2026 Capex Falls to RM212 Mn as Fibre Expansion and 5G Backhaul Investments Continue

Why It Matters

The shift signals TM’s disciplined cost management while still prioritizing network expansion critical for Southeast Asia’s digital transformation, positioning the company for sustained growth in high‑margin cloud and AI services.

Key Takeaways

• Q1 capex fell 66.5% QoQ to RM212 mn ($46 mn).
• Access infrastructure remained largest spend at RM134.6 mn ($30 mn).
• Digital infrastructure investment rose to RM21.8 mn, emphasizing cloud services.
• Revenue grew 2.9% YoY to RM2.93 bn ($645 mn).
• EBIT margin held steady at 34.9% despite lower capex.

Pulse Analysis

Telekom Malaysia’s Q1 2026 capex plunge mirrors a broader regional trend where telcos trim discretionary spending after heavy pandemic‑era investments. By slashing quarterly outlays to RM212 million—roughly $46 million—the carrier aligns its cash flow with the maturation of its data‑centre portfolio, a move that analysts view as prudent given volatile macro‑economic conditions. Compared with peers such as Singapore’s Singtel, TM’s capex intensity now sits below the industry average, offering a buffer for future strategic bets.

The bulk of the reduced budget still fuels fibre broadband expansion and 5G mobile backhaul, sectors that underpin the company’s PWR 2030 transformation agenda. With RM134.6 million earmarked for access infrastructure, TM is extending high‑speed connectivity to its 3.2 million broadband subscribers, a critical enabler for AI‑driven services, hyperscaler partnerships, and cloud‑native offerings. This focus not only strengthens TM’s quad‑play proposition but also positions it as a preferred wholesale carrier for global cloud providers seeking low‑latency routes across the Malay Peninsula.

Financially, TM delivered a 2.9% revenue uplift to RM2.93 billion and lifted EBIT by 6.3%, while maintaining a robust 34.9% EBITDA margin. The resilience stems from disciplined cost controls, automation, and a shift toward higher‑margin digital services such as cybersecurity and AI platforms. Investors can expect the second half of 2026 to see a capex ramp‑up, potentially accelerating revenue growth as the fibre and 5G backbone reaches critical mass, reinforcing TM’s competitive stance in a rapidly digitizing Southeast Asian market.