Telefonica, S.A. (NYSE:TEF) Q1 2025 Earnings Conference Call May 14, 2025 4:00 AM ET Company Participants Torsten Achtmann - Director of IR Emilio Rodriguez - COO Laura Abasolo - CFO and Control Officer Lutz Schuler - CEO Virgin Media O2 Markus Haas - CEO of Telefonica Deutschland Conference Call Participants Andrew Lee - Goldman Sachs Mathieu Robilliard - Barclays Fernando Cordero Barreira - Banco Santander Akhil Dattani - JPMorgan James Ratzer - New Street Research Keval Khiroya - Deutsche Bank Operator ...

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that t ...

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock char ...

金十数据4月28日讯，西班牙停电后，部分地区的手机信号中断。沃达丰西班牙公司表示，由于使用了 发电机，其网络有70%的活跃度，而另一家运营商Orange则要求客户只有在必要时才使用手机进行通 信，以避免使网络不堪重负。 西班牙电信公司要求客户非必要不要使用手机 ...

Telefonica, S.A.’s (TEF) subsidiary, Movistar Chile, has launched the largest technological renovation project for its mobile network from the iconic Germán Becker Stadium in Temuco. This ambitious initiative begins in the Araucanía Region, where Movistar is upgrading more than 260 mobile antennas, strengthening its commitment to a future-ready, high-capacity mobile infrastructure. The upgraded network in La Araucanía brings more than 200% increases in 5G speeds, with a robust transformation in performance ...

Telefonica, S.A.'s (TEF) digital business arm, Telefonica Tech, has partnered with Dexory, a robotics and data intelligence provider, to accelerate the digital transformation of the logistics sector. The collaboration will be officially announced at Advanced Factories 2025, Europe's premier industrial innovation congress, held in Barcelona, Spain, from April 8 to 10. The initiative will empower logistics, distribution and manufacturing businesses by integrating Telefonica Tech's cutting-edge IoT connectivit ...

Telefonica, S.A. (TEF) recently unveiled ‘Tu Empresa Segura Lite,’ a specialized cybersecurity service designed to protect self-employed professionals and micro-enterprises in Spain. The state-of-the-art service offers advanced protection against cyber threats, real-time threat detection and cybersecurity training to help users develop best practices for safeguarding their digital assets.This self-managed security service enables self-employed individuals and micro-enterprises to safeguard themselves agains ...

Telefonica (TEF) could be a solid choice for investors given its recent upgrade to a Zacks Rank #1 (Strong Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.Since a changing ea ...

Financial Performance - Consolidated revenues for 2023 reached €40,652 million, a 1.65% increase from €39,993 million in 2022[62] - Operating income for 2023 decreased to €2,593 million, down 36.1% from €4,056 million in 2022[62] - Profit before tax for 2023 was a loss of €1,473 million, compared to a profit of €2,960 million in 2022[62] - The net profit for 2023 was a loss of €574 million, a significant decline from a profit of €2,319 million in 2022[62] - Basic loss per share attributable to equity holders of the parent for 2023 was €(0.20), compared to earnings of €0.31 in 2022[62] Cash Flow and Assets - Cash and cash equivalents as of December 31, 2023, were €7,151 million, a slight decrease from €7,245 million in 2022[62] - Net cash provided by operating activities for 2023 was €11,649 million, down from €11,763 million in 2022[62] - Total assets decreased to €104,324 million in 2023 from €109,642 million in 2022[62] - Equity decreased to €27,096 million in 2023 from €31,708 million in 2022[62] Dividends and Investments - The company plans to maintain dividends per ordinary share at €0.30 for 2023, consistent with 2022[62] - The consolidated investment in spectrum acquisitions and renewals amounted to €157 million in 2024, primarily due to spectrum acquisition in Colombia[102] - The Group's investment in CapEx for 2024 was €5,475 million, slightly down from €5,579 million in 2023[111] Research and Development - Total research and development expenditure in 2024 was €647 million, representing 1.6% of the Group's revenues[111] - Revenues from new digital services, including IoT, cybersecurity, and cloud services, accounted for over 40% of the Company's B2B revenues in 2024, growing by double digits compared to 2023[106] Regulatory and Compliance - The United Kingdom has implemented its own data protection framework post-Brexit, which mirrors the GDPR but with tailored adjustments, increasing compliance risks for Telefónica[119] - The European Commission adopted its adequacy decision for the EU-U.S. Data Privacy Framework on July 10, 2023, allowing for international data transfers to U.S. companies[118] - Telefónica has adopted Binding Corporate Rules (BCRs) approved by the Spanish Data Protection Authority on March 8, 2024, to limit risks from international data transfers[120] - Significant breaches of the GDPR may result in fines of up to 20 million euros or 4% of the company's total annual revenue for the previous financial year[122] Cybersecurity and Risks - The Group has faced various cybersecurity incidents in the past three years, including intrusion attempts and data theft, although none have had material consequences to date[133] - Inflationary pressures have eased in 2024, but high interest rates and geopolitical tensions continue to pose risks to Telefónica's business operations[140] - The Group's operations are exposed to diverse legislation and political environments, which may adversely affect its financial position and cash flows[138] - The Group faces significant economic and political uncertainties in the regions it operates, which may adversely affect its business and financial condition[156] Debt and Financial Management - As of December 31, 2024, the Group's gross financial debt was €38,782 million, an increase from €37,061 million in 2023, while net financial debt was €27,161 million, slightly down from €27,349 million in 2023[161] - The average maturity of the Group's debt as of December 31, 2024, was 11.3 years, compared to 11.6 years in 2023[161] - A 100 basis points increase in interest rates would result in an additional €41 million in financial expenses, while a decrease of the same magnitude would reduce expenses by €41 million[169] - The Group had undrawn committed credit facilities amounting to €11,017 million as of December 31, 2024, with 3.5% of this amount scheduled to expire before December 31, 2025[165] Capital Expenditures and Network Expansion - Capital expenditures in 2024 amounted to 5,475 million euros, a decrease of 1.9% compared to 2023[224] - The company aims for a CapEx-to-revenue ratio below 12% by year-end 2026, with over two-thirds of 2024 CapEx allocated to network expansion and IT system transitions[223] - By the end of 2024, Telefónica Spain's fiber optic network reached 30.8 million homes passed, with 5G coverage at 91% of the population[225] - Telefónica Germany achieved 99% 5G coverage in 2024, with investments of 1,141 million euros focused on expanding 5G and enhancing 4G capacity[225] Corporate Transactions and Shareholder Actions - Telefónica launched a new issuance of notes in an aggregate principal amount of 1,750 million euros, intended for investments in high-speed telecommunications networks and renewable energy[191] - The voluntary public acquisition offer for shares of Telefónica Deutschland was accepted by shareholders holding approximately 7.86% of its share capital for an approximate amount of 549 million euros[193] - Telefónica owned, directly and indirectly, 94.12% of the share capital and voting rights of Telefónica Deutschland as of January 26, 2024[194] - Telefónica reduced its share capital by €80,296,591 through the cancellation of an equal number of treasury shares, resulting in a new share capital of €5,670,161,554[9]

Financial Position and Performance - Telefónica, S.A. reported non-current investments in Group companies and associates amounting to €49,650 million as of December 31, 2024[14]. - The audit opinion confirmed that the annual accounts present fairly the financial position and performance of Telefónica, S.A. in accordance with applicable financial reporting standards[7]. - The company is responsible for assessing its ability to continue as a going concern and must disclose any relevant matters[23]. - The audit and control committee oversees the preparation and presentation of the annual accounts[23]. - The management report for the 2024 financial year is consistent with the information contained in the annual accounts[21]. - Total assets decreased to €63,453 million, down 2.4% from €65,000 million in 2023[43]. - Equity decreased to €18,465 million, down 8.0% from €20,077 million in 2023[45]. - Non-current assets decreased to €55,304 million, down 4.2% from €57,729 million in 2023[43]. - Total recognized income and expense for the year was €503 million, down from €1,991 million in 2023[49]. - The company reported a net increase in cash and cash equivalents of €347 million in 2024, contrasting with a decrease of €321 million in 2023[52]. Revenue and Profitability - Total revenue for 2024 increased to €6,429 million, up 47.4% from €4,362 million in 2023[47]. - Profit for the year decreased to €223 million, down 89.6% from €2,153 million in 2023[47]. - The company experienced a profit before tax of €512 million in 2024, down from €1,129 million in 2023, indicating a decline of approximately 54.6%[52]. - Profit for the year improved from a loss of €574 million in 2023 to a profit of €209 million in 2024, marking a significant turnaround[97]. Impairment and Write-downs - A net write-down of impairment provision of €4,405 million was recognized in the income statement for the year[18]. - The company conducted an impairment test for its investments at least annually, or more frequently if necessary[15]. - Impairment losses on financial instruments increased to €4,480 million, up from €1,207 million in 2023[47]. - Impairment of investments in Group companies and associates rose sharply to €4,405 million in 2024 from €1,208 million in 2023, reflecting a substantial increase of 264.5%[52]. - Telefónica, S.A. recognized an impairment provision of €4,405 million in 2024, compared to €1,208 million in 2023, primarily affecting Telefónica Hispanoamérica, S.A.[140]. Cash Flow and Investments - Telefónica reported cash flows from operating activities of €4,547 million in 2024, a significant increase from €1,720 million in 2023[52]. - Cash flows used in investing activities were negative at €397 million in 2024, a decrease from positive cash flows of €1,761 million in 2023[52]. - Cash flows used in financing activities were €(3,762) million in 2024, slightly improved from €(3,834) million in 2023[52]. - The company plans to invest between 10% and 16% of revenue for business development in Brazil[147]. - The total loans to group companies and associates in 2024 amounted to €2,307 million, an increase from €2,057 million in 2023[155]. Shareholder Actions and Capital Structure - The company proposed a distribution of €563 million from its net profit for 2024, which will be allocated entirely to unrestricted reserves[73]. - Telefónica, S.A. launched a capital increase of €550 million on January 23, 2024, to fund the payment to shareholders from the voluntary public tender offer for Telefónica Deutschland Holding AG[116]. - The share capital of Telefónica, S.A. was reduced by €80.3 million through the cancellation of treasury shares, resulting in a new share capital of €5,670 million[189]. - The Board of Directors is authorized to increase the share capital by a maximum nominal amount of €2,596,065,843 within five years from the resolution date[197]. - The shareholders authorized the Board to issue securities, including preferred shares and warrants, with a maximum issuance limit of €25 billion[199]. Market and Economic Factors - Management's cash flow projections involved significant judgments regarding revenue growth, long-term EBITDA margin, and discount rates, which could be affected by future economic trends[17]. - The long-term EBITDA margin estimates for Telefónica Group in Brazil range between 41% to 44%, with a WACC of 11.5% after taxes for year-end 2024[147]. - The depreciation of the Brazilian real against the euro was 16.88%, negatively impacting the value of investments[148]. - In Chile, the discount rate (WACC) used for value calculations is 8.5% after taxes, with a perpetuity growth rate of 2.8%[150]. - The terminal growth rate for discounted cash flows is set at 1%, below the real terminal growth forecast for the UK economy[145]. Other Financial Metrics - Non-current borrowings increased to €3,206 million, up 23.7% from €2,592 million in 2023[45]. - Cash and cash equivalents increased to €5,015 million, up 7.4% from €4,668 million in 2023[43]. - The fair value of financial assets at fair value with changes through equity was €417 million at the end of 2024, down from €466 million in 2023[172]. - Trade receivables decreased from €500 million in 2023 to €265 million in 2024, primarily due to a reduction in tax receivables from €237 million to €23 million[184]. - The company recorded a favorable award of $380 million (approximately €365 million) from the Republic of Colombia, with accrued interest of $164 million (approximately €158 million) as of December 31, 2024[180][181].