Telstra has unveiled a $1 billion on-market share buyback as the telco reports a bumper $2.34 billion net profit, up 31% on the previous year, driven by major cost-cutting and rising mobile plan prices.

The announcement follows a $750 million buyback completed just two months ago.

CEO Vicki Brady said the company remains “focused on delivering value for our shareholders through disciplined capital management and investment in growth.”

Annual revenue remained flat at $23.9 billion, while underlying EBITDA rose nearly 5% to $8.6 billion.

Telstra will pay a final fully franked dividend of 9.5 cents per share on September 25, taking the total payout for the year to 19 cents, up 5.6%.

Telstra's chief executive Vicki Brady

Telstra’s chief executive Vicki Brady

Despite strong profits, Telstra’s mobile business struggled.

Postpaid subscriber numbers barely grew, adding just 4,000 in the second half, while total postpaid services fell by 56,000 over the year.

Analysts point to increased competition from Optus and TPG’s $1.6 billion network-sharing deal, as well as the deactivation of older Covid-era plans.

Brady said the shutdown of the company’s 3G network at the end of last year, along with the normal transitions between network generations, had impacted the company’s growth.

Cost savings also contributed to the record profit, with Telstra reducing core fixed costs by $306 million this year and cutting around 3,200 jobs across the business.

The company also announced the sale of 75% of its cloud unit, Versent Group, to Infosys for $233 million, retaining a 25% stake and transferring 650 staff. The deal is aimed at strengthening AI and cloud capabilities through the Infosys partnership.

Telstra’s shares fell 2.9% to $4.84 following the results, reflecting investor caution over slower mobile growth.

However, the company maintains its market leadership with a 41% share of the Australian mobile market.