KPN Eyes Defence Revenue Surge Amid European Rearmament Push

Dutch telecom giant KPN anticipates over 10% growth in defence revenue in response to heightened European defence investments. As nations bolster military budgets amid regional tensions, telecom companies like KPN are pivoting towards defence. KPN, partnering with the Dutch army, underscores the rising demand for secure communications.

KPN, a leading Dutch telecommunications company, forecasts a significant rise in its defence-related revenue, expecting an increase exceeding 10% in the coming years. As European countries ramp up their defence investments, CEO Joost Farwerck emphasized the importance of self-reliance in turbulent times, highlighting KPN's strategic role in cooperating with defence sectors in the Netherlands.

The European Union is witnessing a surge in military expenditure, partly due to geopolitical tensions from Russia's invasion of Ukraine, pushing estimated defence budgets to around 381 billion euros by 2025. Telecom giants across Europe, including Finland's Nokia and France's Orange, are increasingly diversifying into defence to meet the soaring demand for secure communication solutions.

KPN's longstanding partnership with the Dutch army includes providing crucial services like 5G connectivity and cybersecurity. The company's defence revenue reached 100 million euros last year, although they do not list it separately in financial reports. Despite positive earnings, KPN's shares saw a brief slip, coinciding with the announcement of a shareholder return initiative totaling 250 million euros.