Owners of Telstra Group Ltd (ASX: TLS) shares have benefited from the company's efforts to grow revenue and reduce costs in the past few years. Rising dividends have been one of the most noticeable benefits, in my view. In this article, we're going to look at where Telstra shares could go in the next few years.  

The business recently reported its FY25 half-year result, which included a number of positives.

In the first six months of FY25, Telstra's total income rose 0.9% to $11.8 billion, underlying operating profit (EBITDA) increased 5.8%, and net profit for shareholders rose 6.5% to $1 billion. The telco's dividend per share rose 5.6% to 9.5 cents.

This came after the business reported mobile handheld users increased 2.5%, or a 119,000 increase of the actual number of users.

I'm going to look at some of the forecasts for the business.

FY28 expectations for Telstra shares

The business has already made a lot of progress with its mobile coverage for users.

Its overall mobile coverage was expanded to more than 3 million km2, taking it to 99.7% of the Australian population coverage. The company also said 60% of its mobile traffic is now on the 5G network at December 2024. I think Telstra's mobile coverage will continue to expand, and more mobile traffic will go through 5G as that infrastructure is built out further.

Telstra continues to extend its intercity fibre network across Australia, with seven fibre routes between Australia's major capital cities under construction. As of February 2025, more than 3,000km of fibre was in the ground. I expect the company to make significant progress on this over the next three years.

UBS is expecting the business to announce its T28 strategy in June 2025, where the broker thinks there is potential upside for mobile, AI, and capital management.

The broker said management has a strong return on invested capital (ROIC) focus and "sounded very confident in the outlook for mobile and ability to hit $350 million of cost out this year."

In FY25, UBS predicts Telstra's revenue will be $23.9 billion, operating profit (EBIT) will be $4 billion, and net profit will be $2.3 billion. This could help fund an annual dividend per share of 19 cents in the current financial year.

By FY28, the broker projects Telstra could generate $25.5 billion of revenue, $5.15 billion of operating profit (EBIT), and $3 billion of net profit. This could allow the business to pay an annual dividend per Telstra share of 25 cents.

The company is currently trading at 21x FY25's estimated earnings. In three years, if Telstra were to be trading at the same price-earnings (P/E) ratio, the Telstra share price could rise to approximately $5.40, implying a possible rise of 30% over the next three years.