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Moody's upgrades Telecom Italia's rating on deleveraging progress - Finance news and analysis from Global Banking & Finance Review
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Moody's upgrades Telecom Italia's rating on deleveraging progress

Published by Global Banking & Finance Review

Posted on May 11, 2026

1 min read

· Last updated: May 11, 2026

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Moody's Upgrades Telecom Italia to Ba1 Citing Deleveraging and Improved Credit Metrics

Moody's Rating Upgrade and Financial Outlook for Telecom Italia

Upgrade Details and Rationale

May 11 (Reuters) - Moody's upgraded Telecom Italia's long-term corporate family rating to "Ba1" from "Ba2" on Monday, citing consistent execution of its strategic plan that led to a structurally deleveraged balance sheet and improving credit metrics.

Expectations for Future Performance

"We expect the company to continue to generate positive free cash flow over 2026-2028, which, together with ongoing debt repayment, will underpin further deleveraging," said Ernesto Bisagno, vice president at the credit ratings agency.

Reporting and Editorial Credits

(Reporting by Aatrayee Chatterjee in Bengaluru; Editing by Shilpi Majumdar)

Key Takeaways

  • The upgrade reflects Telecom Italia’s structurally lower leverage, thanks to disciplined execution of its strategic plan and strong cash generation guidance over 2026–2028, per Moody’s vice president Ernesto Bisagno.
  • Telecom Italia has already achieved dramatic deleveraging—net debt dropped by about €15 billion following the 2024 NetCo sale to KKR—and its net leverage was below two times at end‑March 2026, reinforcing the rating action.
  • Despite first‑quarter 2026 operational challenges, including elevated losses in Italy and margin pressures, growth in Brazil and confirmed guidance for cash flow and debt reduction support the upgraded credit profile.

Frequently Asked Questions

Why did Moody's upgrade Telecom Italia's credit rating?
Moody's upgraded Telecom Italia's rating due to consistent execution of its strategic plan, which led to a structurally deleveraged balance sheet and better credit metrics.
What is Telecom Italia's new credit rating according to Moody's?
Telecom Italia's long-term corporate family rating was upgraded to Ba1 from Ba2 by Moody's.
What future performance does Moody's expect from Telecom Italia?
Moody's expects Telecom Italia to continue generating positive free cash flow over 2026–2028, supporting further deleveraging and debt repayment.
Who commented on the credit rating upgrade at Moody's?
Ernesto Bisagno, vice president at Moody's credit ratings agency, commented on the upgrade.

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