What happened? *Telefonica shares are currently -10% following new CMD guidance this year. We believe shares could trade lower given the size of the underlying consensus FCF cuts and lay out some more detailed thoughts below. How big is the FCF cut in FY26/ FY28? *FY26: TEF is guiding for EUR 2.9-3.0 bn under their ''new'' FCF definition (ex restructuring and VMO2 dividends). *TEF note that restructuring costs in FY26 will ''increase'' vs the EUR 1 bn this year - given they are calling it out explicitly, and this will be the first year of the cost-cutting programme, we assume this could be ~EUR 1.3bn. We also expect the VMO2 divi to be zeroed given the company''s high leverage (cons has ~EUR 200m in). So on a lfl basis we see ''real'' FCF EUR 1.6-1.7 bn - i.e. ~40% cut to cons FCF. *Finally, based on the 3Q25 slides (separate to the CMD) it appears that TEF now expect to receive the ~EUR 300m Colombian tax proceeds in 2026 (rather than 2025, hence d/grade to FY25 FCF). Our understanding is that this ~EUR300m one off is also included in the FY26 FCF definition - removing this would imply ''real, recurring'' FCF of EUR 1.3-1.4 bn. If correct, that compares to current consensus of EUR 2.6 bn FCF in 2026 - i.e. potentially up to a 50% cut to FY26 cons FCF. *FY28: Taking the ~EUR 2.7 bn starting point for FCF (under ''new'' definition) and applying 4% CAGR, we end up with ~EUR 3 bn FCF in 2028. *Then take off restructuring costs, this will be lower than in 2026 but we assume still around EUR 2 bn. We also assume no dividend payment from VMO2. *That implies ''real'' FCF of ~EUR 2 bn in FY28 vs. BBERG cons at ~EUR 2.8 bn - i.e. an ~30% cut to 2028 consensus FCF. Sense checking against dividend guidance *TEF has halved the dividend to EUR 0.15 - implying annual cash costs of ~EUR 850m. *Target payout of FCF (post restructuring/ VMO2 dividends etc) is 40-60%. This makes sense for FY26 (850/1650 = 51.5% payout) and also for FY28 (850/2000 = 42.5% payout). What is...