The 2020 travel hiatus has lost European carriers some 2 billion euros in roaming fees, according to my calculations based on this year’s earnings reports. That might only be about 1% of their total revenue, but in many cases the drop-off has been enough to make the difference between profit growing and shrinking, trimming earnings for some operators by four or five percentage points. It chips away at their contention that new digital tools are making profitability more resilient.
That’s because roaming is significantly more profitable to carriers than standard phone plans. It can generate a more than 50% Ebitda margin, an earnings measure, compared with the typical 35%, Bloomberg Intelligence analyst Erhan Gurses estimates.
It’s a particularly lucrative money-spinner for companies active in the tourist hotspots of southern Europe: the likes of Telecom Italia SpA, Vodafone Group Plc, France’s Orange SA and Spain’s Telefonica SA. Roaming can proportionately account