Proximus PLC (PROX.BR): BCG Matrix [Dec-2025 Updated]

Proximus's portfolio balances high-growth stars-fiber expansion, Telesign digital identity and convergent residential bundles-backed by heavy CAPEX to secure future margins, with reliable cash cows like postpaid mobile, BICS and enterprise connectivity funding investments; the company must now decide whether to double down on fast-growing but capital-hungry question marks (cybersecurity, private 5G, cloud) to capture new revenue or conserve cash by accelerating the managed decline of legacy dogs (fixed voice, SMS wholesale, prepaid), a mix that will determine whether Proximus converts growth opportunities into sustained returns-read on to see how capital allocation choices will shape its future.

Proximus PLC (PROX.BR) - BCG Matrix Analysis: Stars

Stars - Fiber to the Home Expansion

Proximus has expanded fiber-to-the-home (FTTH) coverage to 48% of Belgian households as of December 2025. The premium high-speed internet segment exhibits an 18% annual market growth rate driven by remote work, streaming, and business demand for symmetric bandwidth. Proximus holds a 42% market share in the premium high-speed internet segment. Annual capital expenditure for fiber deployment is maintained at €1.3 billion to accelerate roll-out and secure nationwide infrastructure dominance. Fiber services contribute 22% of total domestic revenue and deliver a 35% EBITDA margin, reflecting strong unit economics and pricing power.

The following table summarizes the key FTTH metrics:

• Accelerated FTTH roll-out to protect market share and premium pricing.
• Continued €1.3bn annual CAPEX required to reach >80% household coverage long-term.
• Monetize fiber via tiered gigabit tiers, business services, and wholesale access.

Stars - Telesign (Digital Identity & Programmable Communications)

Telesign contributes 17% to total group revenue and operates in a global market expanding at 22% annually (digital identity, authentication, programmable communications). Proximus has achieved a 12% market share in the North American authentication sector under the Telesign brand. The segment posts a high gross margin of 52%, well above group averages, driven by SaaS-like recurring revenues and low incremental delivery costs. Investment in software development equals 15% of Telesign's operating expenses to sustain product innovation and API reliability.

The following table details Telesign performance metrics:

• Prioritize API reliability, scalability, and compliance to defend 12% NA share.
• Invest R&D to expand product suite (fraud prevention, passwordless auth) and preserve 52% gross margin.
• Pursue strategic partnerships and cross-sell into Proximus enterprise customers to increase ARPU.

Stars - Convergent Residential Services (4-play Bundles)

Demand for 4-play convergent bundles (mobile, internet, fixed voice, TV) is growing at 10% annually in Belgium. Proximus holds a 45% market share in the residential convergent segment, with this customer cohort contributing 30% of total domestic consumer revenue. Convergent customers exhibit a churn rate 5 percentage points lower than single-play subscribers, increasing lifetime value. Average revenue per user (ARPU) among convergent customers has increased by 6% through upselling, tiered packages, and loyalty programs.

Key convergent metrics are shown below:

• Focus on retention through loyalty programs and integrated billing to maintain low churn.
• Bundle innovation (QoS guarantees, exclusive content, cloud services) to sustain ARPU growth.
• Cross-sell Telesign and business services to convergent customers where applicable to increase wallet share.

Proximus PLC (PROX.BR) - BCG Matrix Analysis: Cash Cows

Cash Cows

The Cash Cows of Proximus are mature, high-share, low-growth businesses that generate reliable operating cash flow to fund strategic initiatives and infrastructure modernization. The following sections detail the three primary cash-generating units: Domestic Mobile Postpaid Services, BICS International Carrier Services, and Enterprise Connectivity Solutions.

Domestic Mobile Postpaid Services

The domestic mobile postpaid segment remains a cornerstone of Proximus's portfolio with a 39% market share in Belgium. Market growth for mobile services has decelerated to a steady 1.2% in the current fiscal year, reflecting saturation and high penetration. Despite low growth, postpaid services deliver a robust EBITDA margin of 44%, representing substantial liquidity. Postpaid contributes 34% of total domestic revenue and funds ongoing CAPEX-light network maintenance after the main 5G rollout. Annual CAPEX requirements for mobile have fallen to €150 million following completion of core 5G infrastructure, supporting a strong free cash flow profile.

• High-margin subscription base with predictable ARPU.
• Low incremental CAPEX needs due to 5G completion.
• Churn rates moderated by bundled offers and contract maturity.

BICS International Carrier Services

BICS is a major international wholesale carrier and roaming services provider, accounting for 21% of total group turnover. The international wholesale market is mature with a low growth rate of 2.5%, but BICS holds a dominant 28% share in international voice and data roaming. The segment delivers consistent cash flow with an EBITDA margin of 14% despite persistent global pricing pressures. Maintenance CAPEX is minimal at approximately 5% of annual revenue, reflecting capital-light operations focused on interconnect, signaling, and roaming clearing platforms.

• Stable cash generation with predictable billing cycles.
• Exposure to global pricing trends mitigated by scale and long-term contracts.
• Low CAPEX intensity preserves operating cash flow.

Enterprise Connectivity Solutions

The traditional enterprise connectivity and leased-line business is characterized by marginal growth of 1% but a dominant 50% market share among large Belgian corporates and government entities. This segment contributes 15% of group EBITDA with highly predictable margins and an ROI of 18%, supported by a largely fully depreciated asset base and long-term contracts. Customer retention is exceptionally high at 95% for the 2025 period, reducing acquisition costs and stabilizing cash flows. CAPEX is focused on selective upgrades and service resilience rather than large-scale deployment.

• High-margin, contract-driven revenue with minimal churn.
• Legacy asset depreciation enhances cash returns and ROI.
• Predictable revenue stream suitable for cross-subsidizing growth units.

Proximus PLC (PROX.BR) - BCG Matrix Analysis: Question Marks

Dogs - Question Marks: three enterprise-facing units currently exhibiting low relative market share despite high market growth; each unit requires careful allocation decisions as they sit near the "Question Mark" quadrant and risk becoming Dogs if market share does not improve.

Enterprise Cybersecurity Services: market growth ~25% p.a.; Proximus market share 8% in a fragmented Belgian enterprise security market. Revenue from security services equals 4% of total enterprise segment income. Current ROI is approximately 3% due to upfront investment in security operations centers (CAPEX and staffing). Company committed capital: €80 million for new SOCs; hiring and talent costs elevated, driving depressed near-term margins.

Private 5G Network Solutions: high-growth niche with ~35% annual expansion in industrial ports and manufacturing hubs. Proximus holds a 6% share in specialized industrial private 5G. Revenue contribution is <2% of enterprise portfolio. Required CAPEX for scale and bespoke integration is ~€50 million. Target ROI set at ~10% within three years contingent on accelerated adoption and scaling across anchor customers.

Cloud Managed Services: Belgian cloud services market growth ~20% p.a. Proximus market share ~10% within a sovereign/hybrid cloud niche. Segment contributes ~5% to total enterprise revenue. Intense competition from hyperscalers suppresses margins; current margin ~12%. Proximus allocated 12% of enterprise R&D budget to hybrid cloud management platform development; infrastructure and licensing costs remain significant.

Consolidated quantitative snapshot across the three Question Mark units:

Strategic considerations and action options for these Question Marks:

• Prioritize selective investment: increase go-to-market spend where unit economics show path to ROI ≥10% within 2-3 years (favor Private 5G where target ROI is defined).
• Pursue partnerships and alliances to mitigate CAPEX and speed market share gains - MSPs, system integrators, vertical OEMs for ports/manufacturing.
• Consider carve-outs or JV structures for Cybersecurity to attract specialized talent and share SOC CAPEX risk.
• Differentiate Cloud Managed Services via sovereign data guarantees and hybrid orchestration to defend against hyperscalers while improving margin through automation.
• Establish clear KPIs per unit (CAC payback, gross margin %, ARR growth, customer churn) and stage-gate further capital based on hitting milestones.
• Exit or harvest low-probability units if market-share traction remains <5% after predefined investment horizon (18-36 months) and ROI targets are unmet.

Proximus PLC (PROX.BR) - BCG Matrix Analysis: Dogs

Dogs - Legacy Fixed Voice Services: Traditional fixed-line voice services represent approximately 4% of group revenue. The PSTN/ISDN market is contracting at ~15% CAGR. Proximus retains ~60% share of this declining market, creating outsized legacy maintenance costs. EBITDA margins for this segment have fallen to ~10% (compared with group EBITDA margin of ~32%), driven by loss of economies of scale and fixed-cost base. Reported CAPEX allocated to legacy voice is effectively 0% of total group CAPEX as investments are limited to decommissioning activities; operating expenditures remain material due to exchange upkeep and migration programs.

Dogs - Traditional International SMS Wholesale: The international SMS wholesale business (BICS-related legacy SMS) contributes ~3% of consolidated revenue. Global SMS wholesale volumes are declining roughly 10% annually due to OTT substitution. Proximus holds ~15% share of this commoditised, shrinking global market. Pricing pressure has compressed contribution margins to below 5%; this is a commodity price war environment with negative volume and price trends. Strategic repositioning has been initiated, with resources reallocated toward higher-growth digital identity and managed messaging services.

Dogs - Prepaid Mobile Segment: Domestic prepaid mobile represents <4% of total domestic mobile revenue and is contracting at ~8% p.a. as customers migrate to low-cost postpaid plans and convergent bundles. Proximus holds ~25% share of the prepaid submarket versus a materially higher share in postpaid; ARPU for prepaid is ~40% of postpaid ARPU (i.e., prepaid ARPU is ~60% lower). Marketing spend for prepaid has been cut by ~40% to preserve cash flow, and customer acquisition activity has been intentionally reduced. The combination of lower ARPU, declining volumes and reduced marketing converts this subsegment into a low-return dog.

Common characteristics across these Dogs:

• Low and declining revenue contribution: 3-4% per subsegment of group revenue.
• Negative or low growth markets: -8% to -15% p.a.
• Low margins: 5-10% EBITDA range.
• Disproportionate operating/maintenance cost exposure despite near-zero CAPEX.
• Strategic deprioritisation in favour of growth digital services (IoT, fiber, 5G, digital identity).

Recommended tactical actions for Dogs (operational levers and financial implications):

• Accelerate decommissioning of legacy PSTN/ISDN to reduce opex by an estimated €20-40m annually over 3 years.
• Divest or wind down international SMS wholesale positions where possible; aim to reduce revenue exposure from 3% to <1% within 24 months, improving margin mix by eliminating sub-5% margin activity.
• Manage prepaid portfolio as cash-generating tail: freeze new customer acquisition, migrate eligible low-ARPU users to bundled offers, and allocate minimal marketing to defend churn-expected cash flow stabilization within 12-18 months.
• Reallocate freed resources to higher-return investments: fiber roll-out, B2B digital services and identity platforms with target ROI >15%.
• Track KPIs quarterly: segment revenue, EBITDA margin, CAPEX, opex savings from decommissioning, prepaid churn and ARPU migration rates.