Dell’Oro Group research reported worldwide telecom capex increased about 5% year-on-year in the first half of 2026, but the good news wasn’t enough for the analyst firm to change its downbeat projections for future telecom growth.

Reporting that equipment trends remain closely correlated with capex, Dell’Oro also noted a 5% increase in telecom kit revenue spanning broadband access; microwave and optical transport; mobile core network (MCN); radio access network (RAN); and high end router and aggregation.

The uptick comes after what the analyst firm called years of declining investment in the sector. But as reported in April, its researchers expect telecom-related capex to peak sometime over the next 18 months, with broader telecom network spending to drop as soon as this year.

“The first half was stronger than we expected, but the improving near-term trajectory does not materially change the longer-term capex story,” Dell'Oro Group VP Stefan Pongratz noted. “Operators are in a stronger capacity position following the 5G and fiber investment cycles, and the focus is gradually shifting from coverage toward capacity, modernization, automation, and efficiency. At the same time, improving operator revenues are helping to reduce capital intensity ratios even as network investments remain flat.”

Dell’Oro predicts worldwide telecom capex will grow at most a 1% compound annual growth rate (CAGR) between 2025 and 2030. Capital intensity, which peaked at 18% in 2022, is projected to fall to around 14% in 2028, with a modest increase expected with the start of 6G investment.

Telecom equipment revenues are projected to grow at a 2% to 3% CAGR between 2025 and 2030, outpacing communication service provider (CSP) capex, which Dell’Oro said partly reflects incremental demand from cloud vendors.

The first half of 2026 was mostly defined by fiber, with the American CSP giants closing multibillion-dollar fiber deals. Verizon closed its $20 billion Frontier Communications acquisition in January, while AT&T saw gains with its $5.75 billion purchase of Lumen Technologies’ consumer fiber business.

More recently, both firms entered into multi-year agreements with Corning to beef up their fiber and cable provision.

Verizon pitched its Corning deal as helping to meet surging AI demand. But where AI will make a real difference to telecom capex is likely to be on the radio side, with Dell’Oro Group claiming AI radio access network (AI-RAN) would make up one-third of the RAN market by 2029.

The move toward 6G may also provide sufficient balm. According to another Dell'Oro Group report, cumulative 6G RAN revenue is expected to top $100 billion by 2034, with global wireless capital expenditure to reach $500 billion.