Telefonica Eyes M&A to Drive European Telecom Consolidation, CEO Murtra Says

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Telefonica (TEF.MC) is preparing a bold M&A strategy to reshape Europe’s fragmented telecom market, while offloading assets in Latin America to free up capital, CEO and Executive Chairman Marc Murtra told Reuters. His first strategic plan since taking the helm in January envisions building “titanic European operators” to compete globally in telecoms, AI, and digital infrastructure.

Murtra argues that Europe’s market is too fragmented—with 41 operators serving more than 500,000 customers each, compared with just five in the U.S.—and consolidation is needed for competitiveness. Regulators, long wary of higher prices, may now be more open as geopolitical tensions drive Europe to reinforce its strategic autonomy in defense and critical infrastructure.

To fund acquisitions, Telefonica has already agreed to sell its Argentina and Uruguay units, while exploring sales in Chile, Mexico, and Ecuador, which analysts say could free up €3.6 billion ($4.2B). The group has not commented on reports it may raise additional capital.

Potential M&A targets include Vodafone Spain, Germany’s 1&1, assets in Brazil, or Liberty Global’s 50% stake in Virgin Media O2, according to analysts and dealmakers. Meanwhile, French rivals Orange, Bouygues, and Iliad are rumored to be circling Altice’s SFR, signaling a wave of regional consolidation.

Murtra’s vision also involves a “social contract” with regulators: allow consolidation in exchange for commitments to invest in cybersecurity, AI, and data centers. “Imagine a Europe where the satellite systems, the hyperscalers and artificial intelligence are in the hands of tech bros—and this could happen,” Murtra warned.

Telefonica’s shares have rallied since Murtra’s appointment, though its market cap has halved since 2015, and it remains among Europe’s most shorted stocks. Still, analysts see merit in the plan. Moody’s Carlos Winzer noted that scale is “absolutely fundamental” in telecoms, while investment bankers predict country-level consolidation first, followed by cross-border deals.

If Telefonica succeeds, it could trigger a wave of European telecom M&A, pulling in giants like Orange, Deutsche Telekom, and BT, and redefining the continent’s digital infrastructure landscape.

Tesla’s U.S. EV Market Share Falls Below 40% for First Time Since 2017

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Tesla’s U.S. market share dropped to 38% in August, its lowest level since 2017, as rivals gained ground with aggressive incentives and fresh EV lineups, according to exclusive data from Cox Automotive shared with Reuters. The milestone marks the first time Tesla has fallen below the 40% threshold since it was ramping production of the Model 3 eight years ago.

Tesla once commanded more than 80% of the U.S. EV market, but legacy automakers like Hyundai, Kia, Toyota, Honda, and Volkswagen are surging with competitive offerings, boosted by discounts, lease deals, and federal tax credit urgency. In July, rival EV sales climbed between 60% and 120%, while Volkswagen’s ID.4 deliveries jumped over 450% month-over-month.

By contrast, Tesla’s sales grew just 3.1% in August, well below the market’s 14% growth. Even with sales rising 7% in July, Tesla’s share fell sharply to 42% from 48.7% in June—the steepest drop since 2021.

Analysts warn the decline reflects Tesla’s aging lineup and its pivot away from new mass-market EVs toward robotaxis and humanoid robots. Its last major launch, the Cybertruck (2023), failed to replicate the blockbuster success of the Model 3 or Model Y. A refresh of the Model Y also fell flat with buyers.

Cox’s director of industry insights Stephanie Valdez Streaty put it bluntly: “When you’re a car company, when you don’t have new products, your share will start to decline.”

Tesla’s shrinking share comes as its board is asking investors to approve a $1 trillion pay package for Elon Musk, contingent on Tesla reaching a $8.5 trillion valuation. Meanwhile, Musk’s political entanglements with and later break from Donald Trump have added to brand challenges.

With EV tax credits set to expire at the end of September, Tesla faces a dilemma: cut prices further to chase volume and risk margins, or hold prices and cede market share. Investors and competitors alike will be watching closely as the U.S. EV market enters a decisive phase.

Chipmaker IQE Explores Sale After Slashing Earnings Guidance

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IQE (IQE.L), the British semiconductor materials maker supplying Apple’s iPhone facial recognition sensors, said Monday it is considering a potential sale after lowering its earnings outlook amid continued weakness in the smartphone market. The announcement sent its shares down more than 12% to a 16-year low.

The company now expects core earnings between a £5M loss and a £2M profit, compared with earlier guidance of £7.4M–£10M profit. Revenue is forecast at £90M–£100M, down from the previous range of £115.1M–£123M, citing contract delays in wireless and photonics. By comparison, IQE posted £8.1M profit on £118M revenue last year.

IQE said it has been approached by an undisclosed party regarding a potential acquisition, expanding its ongoing strategic review to include a sale. The company is also pursuing the previously announced sale of its Taiwan operations, with talks underway with prospective buyers.

The group, which has facilities in the U.K., U.S., and Taiwan, has struggled under declining smartphone demand and high levies on semiconductors. Data from IDC shows global smartphone sales grew just 1% in Q2, underscoring the headwinds for suppliers.

IQE has been working to cut debt and shift production to the U.S., hoping to better align with demand trends and navigate geopolitical trade pressures. But with shares tumbling to 7.64 pence, investors are questioning whether a sale is now the most viable path forward.