STC paid a dividend for the fourth quarter of 2025 despite reporting a 40 percent drop in annual net profit, with the quarterly payout of SAR 2.7 billion bringing the total yearly distribution to almost SAR 11 billion.
The profit decline, it should be noted, was largely a base effect:
net earnings fell to SAR 15 billion last year, down from SAR 25 billion in 2024, due to the impact of a one-off gain of SAR 14 billion from discontinued operations resulting from stake sales in two subsidiaries to the Public Investment Fund.
Strip out that distortion and the underlying operating trajectory looks considerably more stable than the headline number suggests. The STC share price target debate among analysts therefore turns less on near-term earnings momentum and more on the credibility of the dividend policy through 2027 and what replaces it thereafter.
PIF owns 62 percent of STC, and shares closed at SAR 44.80 in February 2026, up 4.2 percent year to date.
Mobily presents a different and in some respects more textured income story.
Mobily's dividend history over the past decade reveals a mix of volatility and resilience, with a sharp drop in 2025 from SAR 0.63 to SAR 0.35 per share, though from 2020 to 2024 dividends nearly doubled, with a 104.35% surge in 2024 alone.
That volatility is not irrational; it reflects a management team willing to calibrate payouts to capital allocation priorities rather than defend a nominal yield at the expense of network investment.
Mobily's Q2 2025 results were strong, with net profit surging 25.6 percent year-over-year to SAR 830 million, driven by an 8.1 percent revenue increase and a 37.8 percent EBITDA margin.
The Mobily stock price target conversation is therefore inseparable from the question of how the company chooses to deploy its improving free cash flow, and whether the capex intensity of the current cycle begins to moderate.
Its capital expenditure strategy of SAR 2.697 billion in the first half of 2025 has supported infrastructure projects including the Red Sea subsea cable and 5G spectrum licenses.
These are not vanity investments. They are the foundations of the competitive moat that will determine Mobily's pricing power in the enterprise segment over the next decade.
The context in which both operators are spending is genuinely extraordinary in scale.
Saudi Arabia now ranks third globally in 5G download speed at 243.7 Mbps average per Ookla, and ninth overall in mobile internet performance as of December 2025.
The 5G rollout is not limited to major urban centers but is extending to remote and underserved areas, with investments in 5G base stations, fiber backhaul, and spectrum acquisition enabling the country to build one of the most advanced telecom infrastructures in the region.
The Kingdom targets a digital economy contribution of 19.2 percent of GDP by 2030,
and the telecom operators are the enabling infrastructure layer beneath that ambition. Saudi Vision 2030 telecom infrastructure spending is therefore not a discretionary corporate decision; it is a quasi-sovereign commitment that the operators are executing on behalf of a national economic program. That changes the analytical frame considerably. The capex is not purely a drag on free cash flow. It is also the mechanism by which the operators deepen their structural position in an economy that is deliberately reorganizing itself around digital connectivity.
Where does e& fit into this picture? The Abu Dhabi-listed group, formerly known as Etisalat, holds a meaningful stake in Mobily and its own dividend profile has attracted sustained attention from regional income investors. The etisalat dividend yield 2025 conversation is ultimately a question about whether e& can sustain its historically generous distributions while funding its own international expansion and supporting the capex cycle at its Saudi subsidiary.
Mobily's projected dividend growth to 6.0 percent yield by 2028 makes it an attractive alternative for those seeking a balance between yield and growth,
and that trajectory is partly a function of how aggressively e& chooses to upstream capital from its Saudi operations versus reinvesting it at the network level.
Both STC and Mobily are maintaining debt-to-equity ratios below 1.0 and robust dividend yields, with STC at 4.2 percent and Mobily at 3.8 percent,
suggesting that balance sheet discipline has not been abandoned in the rush to build. That is the most reassuring data point for income-oriented investors in the sector: the infrastructure ambition and the capital return proposition are, for now, coexisting rather than competing. Whether that equilibrium holds through the latter half of this decade, as 5G monetization timelines and enterprise revenue ramp-up rates become clearer, is the question that will define the sector's investment narrative for the next several years. The operators have placed a large and structurally well-reasoned wager on digital infrastructure. The terms of the return are still being written.
For informational and research purposes only. Not a solicitation. Consult a licensed financial advisor before making any investment decision.
