Aussie Broadband Ltd (ASX:ABB) shares surged after the internet services provider reported a stronger profit and flagged new contracts and asset sales that are expected to bolster future earnings.
The stock climbed 13% to $5.03 in early trade after the company posted a fiscal 2025 net profit of $51.6 million, up 7% and ahead of some analyst forecasts.
Revenue rose 19% year-on-year to $1.19 billion, broadly in line with consensus estimates. Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 15% to $138 million, also matching market expectations, according to Jarden analysts.
Aussie Broadband has signed a six-year agreement with More and Tangerine to provide National Broadband Network (NBN) services, expected to deliver about $12 million in annualised EBITDA from fiscal 2027. In a separate move, the company will sell its Buddy Telco brand and customer base to Tangerine, eliminating an earnings drag.
Looking ahead, management guided to fiscal 2026 underlying EBITDA of $157 million to $167 million. The midpoint sits about 3.4% above the combined forecasts of Jarden and Visible Alpha, which stood at $157 million.