Telefonica raised its 2026 operating cash flow target after reporting higher adjusted core profit in the second quarter, buoyed by growth in its Spanish and Brazilian businesses. The update underscores improving cash generation and a regional growth narrative that could support valuation upside and more flexible capital allocation in coming quarters.
Telefonica has divested its Chilean mobile unit, selling it to NJJ and Millicom, which is in line with the company's strategy to exit Latin American markets and concentrate on its core operations. This strategic shift may bolster its financial health by reallocating resources towards higher-value markets.