The telecom giant has met several key financial guidance targets for 2024, while also continuing to solidify its position in the Spanish market through increased investments in 5G infrastructure.
Telefónica’s revenue rose to €41.3bn in 2024, following stronger performance in the Spanish market, which was a rise of 1.6%, surpassing the company’s expectations of around 1%. Spain experienced its first year of growth in all key divisions on an annual basis since 2018, as well as the lowest churn since 2013.
Adjusted net income, excluding extraordinary impacts, came up to €2.3bn last year, whereas net financial debt dropped to €27.2bn.
The company met several key financial targets put in place for 2024. Earnings before interest, taxes, depreciation and amortisation (EBITDA) inched up by 1.2%, compared to expectations of growth between 1% and 2% on an annual basis.
Telefónica also announced a 2025 cash dividend of €0.30 per share, of which €0.15 is expected to be paid out in December this year and €0.15 in June next year.
Marc Murtra, the chairman and CEO of Telefónica, said in the January-December 2024 earnings report on the company’s website: “As I take on the role of Chairman and CEO Telefónica, I see a company built on exceptional foundations, large customer base, world-class infrastructure and management skills and know-how. “The Company’s achievements in 2024 demonstrate the strength of these fundamentals and the execution of the strategy. We have delivered on our financial commitments while continuing to strengthen our competitive position. We have sustained momentum in our core markets of Spain, Brazil, Germany and UK, with a strong cash generation of €2.6bn. “We have a unique position to lead in an evolving landscape, a new time in Europe. As such, we have significant opportunities to drive business performance and accelerate value creation. We enter 2025 focused on building on this momentum and delivering sustainable value for all our stakeholders.”
Telefónica improves position in Spanish market
Telefónica has been strengthening its position in the Spanish market lately, mainly because of its wide ranging 5G network coverage. It also has robust fiber optic infrastructure, with the company also ramping up efforts to improve customer loyalty, primarily through bundling products.
This has gone a long way in boosting Spanish revenue, while also maintaining good customer retention rates. The company’s Movistar brand is especially recognised and well-trusted in Spain.
However, several challenges remain for the company in Spain, including mounting competition from smaller competitors who are racing to offer low-cost plans. Telefónica also needs to continue ramping up its infrastructure investment in 5G technology, especially in the current highly competitive environment.
Furthermore, there could be interference from the Spanish government in the company’s business and strategic decisions, given its large size and importance to the Spanish economy. The ongoing weak global economic outlook as well as high inflation across Spain and the rest of the EU lately has also exacerbated the cost of living crisis for several Telefónica consumers.
This means that the company may have to better plan and balance any upcoming price hikes, or risk losing consumers who cannot afford the potential increases.
