Saudi 5G and telecoms are the connectivity layer behind Vision 2030’s digital economy, led by stc and contested by Zain Saudi Arabia and Mobily across mobile, fibre, enterprise, spectrum and data services. The Kingdom now ranks third globally in 5G download speed (243.7 Mbps average per Ookla) and ninth overall in mobile internet performance as of December 2025. The sector is no longer a passive utility — it is the load-bearing layer beneath the smart city programmes, the Aramco Industry 4.0 build-out, the data centre and AI infrastructure surge, and the digital government services that have pushed the Kingdom to the top of the World Bank’s GovTech Maturity Index in 2025.
Saudi Telecom Landscape
The Saudi telecommunications market is a regulated three-operator oligopoly. stc, originally carved out of the Ministry of Posts, Telegraph and Telephones in 1998 and now majority-owned by the Public Investment Fund, holds a structural advantage built on legacy fixed-line infrastructure and the deepest capital base in the region. Mobily, trading as Etihad Etisalat with the UAE’s e& as anchor shareholder, entered as the second mobile operator in 2005. Zain Saudi Arabia followed in 2008 as the third licensee, part of the Kuwait-listed Zain Group.
Total telecommunications sector revenue exceeded SAR 108 billion across the three listed operators in 2025, with stc Group reporting record revenue of SAR 77.8 billion (up 2.5 percent year-on-year), Mobily SAR 19.6 billion (up 7.9 percent), and Zain KSA SAR 11 billion (up 6 percent). Mobile services account for approximately 60 percent of the consolidated total; fixed broadband and enterprise services contribute around 30 percent; wholesale, towers, fintech, and adjacent digital services make up the balance. Average revenue per user has stabilised across all three operators following years of competitive pressure, with data and digital services growth offsetting voice revenue erosion.
Mobile penetration sits well above 200 percent on a SIM basis, reflecting the Kingdom’s high dual-SIM and IoT-connection density. Internet penetration exceeds 98 percent of the population, with mobile internet as the primary access mechanism. Social media penetration above 80 percent reflects an engaged digital population that has made the Kingdom one of the top YouTube and TikTok markets per capita globally — a demand profile that justifies the sustained network capital expenditure.
The Communications, Space, and Technology Commission (CST) serves as the sector regulator, overseeing spectrum allocation, licensing, competition policy, consumer protection, and increasingly the convergence points between telecommunications, satellite, and emerging technology. The CST’s progressive posture — early 6 GHz Wi-Fi 6E release, sandbox frameworks for 5G enterprise use cases, and active spectrum reallocation — has been a meaningful tailwind for operator economics relative to peers in the region.
stc: The Incumbent
stc Group’s FY2025 result was the strongest in the company’s listed history. Revenue of SAR 77.8 billion was supported by a gross profit of SAR 37.7 billion, EBITDA of approximately SAR 24.5 billion (up 6.1 percent excluding non-recurring items), and operating profit of SAR 14.4 billion. Net profit rose 12.5 percent on the same adjusted basis. The market capitalisation places stc among the highest-valued telecom operators in MENA, and the group is a heavyweight constituent of the Tadawul All Share Index — a reference holding for any institutional portfolio benchmarked against Saudi equities.
The 5G footprint is the broadest in the country by site count. stc closed 2025 with more than 10,800 5G sites, complemented by an active migration to 5G Standalone architecture and the first regional commercial deployment of 5G Non-Standalone Cloud RAN in the Middle East and Africa. The company conducted the first regional trial in the 7 GHz band in preparation for 6G technologies and was the first operator globally to successfully trial an ultra-high-speed optical solution capable of 2.4 Tbps data transmission. On the access network, the deployment of Juniper Networks’ 400G routing infrastructure across more than 75 cities delivered a reported 1,340 percent capacity increase alongside an 87 percent reduction in power consumption per bit — a meaningful number given energy costs are now the second-largest line item in 5G operating expenditure.
Beyond pure connectivity, stc Group has executed an aggressive diversification into what management calls the “TechCo” model. stc Bank crossed eight million customers in 2025 and is now a meaningful retail digital banking franchise. The center3 data centre subsidiary signed a framework agreement with HUMAIN — the PIF-backed AI national champion — to develop up to one gigawatt of AI data centre capacity, with the initial 250 MW phase already in design. HUMAIN holds 51 percent of the joint venture, stc the remaining 49 percent. The arrangement positions stc as the privileged carrier neutral host for sovereign AI workloads in the Kingdom and ties the group’s growth thesis directly to the Saudi AI build-out.
International operations span Kuwait (where stc operates the legacy Viva brand), Bahrain, and through investment vehicles into broader regional and European telecommunications and tower assets. The international portfolio diversifies revenue and provides scale for technology platform development, although the domestic market remains the dominant earnings driver and the source of all the strategic operating leverage.
Mobily and Zain KSA
Mobily delivered its strongest year in twelve years in 2025. Revenue grew 7.9 percent year-on-year to SAR 19.6 billion, EBITDA rose 6.0 percent to SAR 7.6 billion at a 38.8 percent margin, and net income increased 11.6 percent to SAR 3.5 billion. The subscriber base reached 14.4 million mobile users — 12.3 million prepaid and 2.1 million postpaid — with FTTH subscribers at 305,000. Mobily closed the year with more than 7,600 5G sites covering 61 cities and reaching above 96 percent of residents in the Kingdom’s seven main metropolitan areas. Capital expenditure of SAR 5.8 billion, a notably high intensity at almost 30 percent of revenue, signals continued commitment to network quality, submarine cables, cloud infrastructure, data centres, and spectrum.
Mobily’s competitive positioning has shifted from pure tariff competition toward enterprise, fibre, and digital infrastructure adjacencies, with management citing “highest active 5G usage” among the three operators per network experience benchmarks. The company’s relationship with parent e&, which reported AED 72.9 billion in group revenue in 2025, provides procurement scale and access to UAE-developed enterprise products and services. Mobily has been a particularly aggressive bidder in CST spectrum auctions, securing 20 MHz in the 700 MHz band and 100 MHz in the 3800 MHz band in the November 2024 round.
Zain KSA reported record revenue of SAR 11 billion in 2025, up 6 percent year-on-year, with EBITDA of SAR 3.5 billion (up 4.5 percent) and net profit of SAR 604 million. The customer base of 8.1 million served a blended ARPU of SAR 60. Data revenue grew 3 percent and now represents 39 percent of total revenue, with a 49 percent surge in 5G subscribers. The most striking operational metric was OpEx falling to 28 percent of revenue from 33 percent in 2024, supported by AI-led efficiencies in network optimisation, customer service automation, and streamlined advertising and maintenance spending — early evidence that AI is starting to compound through telecom cost structures rather than just the marketing decks.
Zain’s network strategy has emphasised population coverage over site density. The operator covered 88 percent of users on 5G by year-end 2025, the widest reach of any operator, on the back of a SAR 1.6 billion investment to expand to more than 7,000 5G towers covering over 66 percent of the Kingdom’s populated area. Zain KSA was the first operator in the Middle East to activate the 600 MHz band for 5G and launched the first phase of commercial 5G Standalone over 600 MHz, with full 5G-SA rollout in Riyadh and Jeddah scheduled during Q4 2025. Growth verticals — fintech, cloud, and wholesale — surged 98 percent year-on-year and now represent a double-digit share of total revenue, mirroring the diversification playbook stc and Mobily are running.
5G Rollout
stc launched commercial 5G in 2019, becoming one of the first operators globally to offer nationwide 5G coverage in major urban areas. By the end of 2025, all three operators had deployed dense urban 5G with rapidly extending suburban and intercity coverage. Combined site counts across the three operators exceed 25,000 5G base stations, utilising mid-band spectrum (3.5 GHz / 3.8 GHz) for the workhorse capacity layer, low-band spectrum (600 MHz, 700 MHz) for coverage and in-building penetration, and millimetre-wave spectrum for ultra-high-capacity applications in dense environments such as airports, stadiums, and giga-project sites.
The architectural transition from 5G Non-Standalone to 5G Standalone is now the principal technology programme. NSA depended on existing 4G core networks; SA unlocks the headline 5G capabilities — true network slicing, ultra-reliable low-latency communication for industrial use, massive machine-type communication for IoT density, and the API exposure that lets operators monetise differentiated network services. Zain has the most aggressive SA timeline with commercial launch in Q4 2025; stc and Mobily are migrating in phases tied to spectrum re-farming and core upgrades.
Network performance metrics validate the deployment. Saudi Arabia ranked third globally in 5G median download speed at 243.7 Mbps and ninth globally in overall mobile internet performance per Ookla’s December 2025 data. Independent benchmarks from Opensignal placed stc highest on availability at 94 percent of time on 4G or 5G, Zain widest on 5G coverage at 88 percent of users, and Mobily highest on active 5G usage. Peak 5G speeds exceeding 2 Gbps have been demonstrated in mid-band-plus-mmWave aggregation conditions; typical user experiences in 5G coverage areas range 300 to 700 Mbps. At Red Sea Global’s destinations, gigabit 5G has been deployed across hospitality assets to support the tourism experience layer.
Spectrum Auctions
The CST has emerged as one of the more disciplined spectrum regulators globally, releasing capacity ahead of demand and using competitive auctions rather than administrative allocation to set prices. The November 2024 auction in the 600 MHz, 700 MHz, and 3800 MHz bands was the fifth IMT spectrum auction since 2018 and produced clean wins across all three operators: stc took 40 MHz at 600 MHz and 100 MHz at 3800 MHz, Mobily 20 MHz at 700 MHz and 100 MHz at 3800 MHz, and Zain 30 MHz at 600 MHz. Cumulative spectrum assignments now span 700 MHz, 800 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2600 MHz, 3500 MHz, 3800 MHz, and 26 GHz — a comprehensive multi-band portfolio for capacity, coverage, and ultra-high-band deployments.
The CST’s June 2025 publication of the Spectrum Outlook for Commercial and Innovative Use (2024-2027) signalled the regulatory roadmap for the back half of the decade. The 6 GHz band was released in its entirety for license-exempt Wi-Fi 6E use, making Saudi Arabia the first country in Asia, Europe, and Africa to do so — a pro-consumer decision that traded one auction’s worth of revenue for a meaningful boost to indoor broadband performance. Looking forward, regulator coordination on the 7 GHz band for early 6G research is in motion, and millimetre-wave reallocations toward enterprise private use are under review.
A separate but consequential spectrum allocation was the 2024 award of 450 MHz spectrum to Aramco Digital, creating Saudi Arabia’s first nationwide industrial-grade communications infrastructure independent of the public mobile networks. This is a structural anomaly in spectrum policy globally — most regulators force enterprise traffic onto public operator networks via slicing — and it directly shapes the addressable market for the three commercial operators.
CST Regulation
Beyond spectrum, the CST’s regulatory programme covers infrastructure sharing, net neutrality, consumer protection, service quality, satellite, and increasingly the digital regulatory layer that governs OTT services and cloud. Infrastructure sharing regulations enable operators to access competitors’ passive infrastructure, reducing duplication and supporting efficient network deployment — a particularly important policy in a market where the Public Investment Fund sits behind both the largest operator and the largest tower company.
Net neutrality principles ensure that internet service providers treat all data traffic equally without discrimination, supporting innovation and competition in digital services. Consumer protection measures include service quality standards, complaint resolution procedures, and contract transparency. The CST publishes operator performance benchmarks, enabling consumers to make informed choices based on independent service quality metrics.
The cybersecurity layer of regulation is governed by the National Cybersecurity Authority, which classifies telecommunications as critical national infrastructure alongside energy, water, finance, health, and defense. The Essential Cybersecurity Controls and the more recent Critical Systems Cybersecurity Controls impose mandatory technical requirements on operators including network segmentation, supply chain security, encryption, identity and access management, and incident reporting timelines. These controls have direct capital expenditure implications — operators are now mandated to architect resilience into network design rather than retrofit it afterwards.
Fibre Penetration
Fixed broadband infrastructure has been significantly expanded. As of September 2025, FTTH accounted for 69 percent of all fixed broadband subscriptions — 2.19 million out of a total fixed base of 3.19 million subscriptions, with the overall fixed broadband base growing 4.6 percent year-on-year. stc’s fibre footprint now passes 3.75 million homes, with peak speeds of 1 Gbps for residential customers and dedicated symmetric high-capacity connections for enterprise clients. The wider fibre coverage estimate from CST data shows approximately 3.6 million Saudi homes under fibre optics coverage as of late 2024, with the penetration rate having crossed 60 percent.
The National Broadband Programme establishes coverage targets for fibre deployment across the Kingdom, including rural and remote areas where commercial deployment is not economically viable. Government subsidy programmes support network extension to underserved areas, with the Vision 2030 target of providing high-quality broadband coverage to 90 percent of homes in densely populated urban areas and 66 percent in less dense urban centres by 2030.
Fixed Wireless Access (FWA) using 5G technology is the second pillar of fixed broadband strategy. FWA accounted for more than 57 percent of total fixed broadband subscriptions in 2025 and per GlobalData forecasts will remain the leading technology by subscription count through 2030, particularly in suburban and semi-rural locations where fibre is uneconomic. 5G FWA services routinely deliver download speeds exceeding 100 Mbps and have become the de-facto solution for rapidly connecting new residential developments before fibre civils complete.
Vision 2030 Digital Targets
The connectivity layer is one of the more clearly progressed parts of the Vision 2030 KPI framework. The National Transformation Program’s 2021-2025 phase targeted continued infrastructure development, sustainability of vital resources, governmental operational excellence, and digital transformation, with more than 300 initiatives tracked against over 80 KPIs. Saudi Arabia ranked first globally on the World Bank’s 2025 GovTech Maturity Index, having moved from 49th in 2020 to 3rd in 2022 and 1st in 2025 — a remarkable shift in a five-year window. By the end of 2022, 98 percent of public services had been digitised, with the residual 2 percent on track for full digitisation by end-2025.
The Digital Government Authority, established in 2021, sits at the demand-side of this build, mandating the public sector services that ride on the operator networks. The Saudi Data and AI Authority (SDAIA) is the mirror authority on the data and AI side. Together with the CST on the infrastructure side and the Ministry of Communications and Information Technology, this constitutes a relatively coherent governance stack for the digital economy — by regional standards, an unusually well-coordinated one.
The economic translation is meaningful. The November 2024 spectrum auction alone is expected to contribute over SAR 25 billion to GDP by 2030 through enhanced digital infrastructure and induced investment. The Saudi Arabia 5G infrastructure market is forecast to grow at a 41 percent CAGR through 2033, and the data centre market is projected to scale from USD 2.5 billion in 2025 to USD 6.17 billion by 2031.
Recent Developments 2024-2026
Several developments from late 2024 through early 2026 reshaped the sector structure. The TAWAL transaction completed in 2024, with PIF acquiring a 51 percent stake from stc and the resulting entity merging with Golden Lattice Investment Company. The combined tower company, owned 54 percent by PIF and 43.1 percent by stc, operates approximately 30,000 mobile tower sites with annual revenue of approximately USD 1.3 billion — among the largest tower companies globally. TAWAL announced plans to add 1,000 new towers in 2025 with annual capital expenditure of more than SAR 1 billion, indicating that the post-merger build-out is accelerating rather than consolidating.
The November 2024 spectrum auction in the 600 MHz, 700 MHz, and 3800 MHz bands was followed in 2025 by Zain’s first commercial 5G Standalone over 600 MHz, the regional first deployment of 5G NSA Cloud RAN by stc, and the regional first 7 GHz trial as a 6G stepping stone. The center3-HUMAIN joint venture announced in late 2025 commits to up to 1 GW of AI data centre capacity in the Kingdom, with the initial 250 MW phase already in design — locking stc into the AI infrastructure value chain. Groq separately secured a USD 1.5 billion commitment from Saudi Arabia for AI inference infrastructure with a data centre in Dammam, illustrating how rapidly the AI compute layer is being capitalised on top of the connectivity layer.
Mobily’s 2025 result was the operator’s strongest in twelve years, suggesting the competitive intensity in the market is now translating into volume rather than purely tariff erosion. Zain’s 5G-SA launch on 600 MHz is one of the more interesting deployments globally given the propagation characteristics of low-band 5G-SA. And the Aramco Digital 450 MHz private 5G network — operationally deployed in 2025 with native 450 MHz Qualcomm chipsets first demonstrated at LEAP 2025 — represents a meaningful structural shift in how industrial connectivity is delivered in the Kingdom.
The connectivity layer is now reciprocally supporting the Saudi giga-project programme, with NEOM, Qiddiya, Diriyah Gate, and the Red Sea destinations all using 5G as the primary connectivity backbone for autonomous mobility, immersive tourism applications, and operational technology integration.
Outlook
The Saudi telecommunications sector entered 2026 in the strongest position in its history. All three operators are at or near record financials, the regulator continues to release spectrum and infrastructure-sharing policies that support investment, and the demand pull from the AI, data centre, government digital services, and giga-project layers is structurally upward. The risks are predominantly external: a global shock to capital costs would tighten the operator capex framework; a regional security event could change risk pricing for the international portfolio components; and the sustained energy costs associated with dense 5G deployment and AI-ready data centres remain the largest single operating cost variable.
The medium-term build is clear. Completion of nationwide 5G coverage and 5G Standalone migration through 2026-2027 will unlock the network slicing and enterprise API revenue streams that have so far been more thesis than reality. Fibre extension to the remaining urban underserved areas combined with FWA in suburban and rural zones will close the connectivity gap to the Vision 2030 target. The convergence of telecommunications with cloud computing, AI, IoT, and digital services will continue to blur traditional industry boundaries — the centre of gravity in the Saudi telecommunications sector is shifting from a pure connectivity utility to a digital and AI infrastructure platform.
The 6G research programme, anchored on the 7 GHz spectrum trials and the broader CST coordination on next-generation requirements, positions the Kingdom to participate in the standardisation phase rather than purely consume the technology. Combined with the sovereign AI compute build-out, the Aramco Digital industrial network, and the tourism and entertainment connectivity layers, Saudi Arabia’s telecommunications sector is now plausibly one of the more strategically important domestic sectors in the global digital economy. Operators that successfully navigate the convergence — capturing value across connectivity, platform, and infrastructure layers — will play central roles in the Kingdom’s digital economy through 2030 and beyond.
External references: Communications, Space and Technology Commission, stc Group Investor Relations, Mobily Investor Relations, Zain KSA Financial Reports, Saudi Vision 2030.