Telstra has beaten analyst expectations for its H1 2025 performance, recording a 7.1 per cent uplift in net profits to $1.12 billion in the six months to December 31.

The company's earnings before interest, tax, depreciation and amortisation (EBITDA) rose 6 per cent to $4.25 billion, while total income was up 0.9 per cent to $11.6 billion.

CEO Vicki Brady welcomed the "strong set of results", in which the telco delivered a "fourth consecutive year of first half underlying growth", which she attributed to "strong momentum across the business", "strong cost control" and "disciplined capital management".

Off the back of the earnings growth, Telstra's board bumped its dividend by 5.6 per cent, and will pay an interim dividend of 9.5 cents per share, fully franked, on March 28. The company also announced an on-market share buy-back of up to $750 million, consistent with its capital management framework.

Telstra's mobile business saw EBITDA growth of $92 million, driven by 119,000 new mobile handheld customers and ARPU growth. Mobile services revenue grew 3.1 per cent.

The company said it would capitalise on that momentum by investing in its 5G network to build new AI features via a new partnership with global networking business Ericsson.

"We are at an inflection point, where customer needs for technology and connectivity are becoming more sophisticated requiring a step change in how connectivity is delivered and consumed. At the same time, demand for mobile data has tripled on our network over the past five years," said Brady.

"Through our partnership with Ericcson, the first-of-its-kind for any operator across Asia Pacific, we will upgrade our radio access network (RAN) with next-generation Open RAN-Ready hardware solutions and 5G Advanced software, and implement AI and automation to optimise network management through self-detection and self-healing capabilities."

Brady said the investment would help Telstra evolve its offering and improve the efficiency of how the company uses its spectrum, enabling it to continue to build capacity on its 5G network and deliver better consistency of performance, reliability and speed.

Looking ahead, Brady said Telstra was on track for its T25 strategy, with its F25 guidance remaining unchanged.

"To close T25 out strongly, we remain focused on: improving customer experience, delivering financial growth and value from our world-leading mobile network and infrastructure,; continuing the reset of our enterprise business; and delivering on our commitment to simplify our operations and improve our productivity."