NOS SGPS (NOS) Q1 2025 earnings summary

Executive summary

• Completed the Claranet acquisition, enhancing ICT and tech capabilities and expanding into the Portuguese ICT and corporate markets.

• Achieved consolidated revenue growth of 4.5% year-over-year, with strong operational transformation driven by AI and digitalization.

• Maintained 5G leadership with 97%+ population coverage, launch of 5G+, and first VONR call in Portugal.

• Recognized as Portugal's top innovator, leading in European patent applications for the second year, with 22 patents filed in 2024, mainly in AI.

• Generated healthy free cash flow, supported by solid operating performance and structurally lower investment needs.

Financial highlights

• Consolidated revenue reached €421.4M, up 4.5% year-over-year; Telco revenue up 4.6%, Audiovisual & Cinema up 1.5%.

• EBITDA rose 4.3% to €192.3M; EBITDA AL - CAPEX up 12.2% to €71.1M.

• Net income was €59.0M, down 13% year-over-year; recurring/adjusted net income up 20.8% to €55.2M.

• Free cash flow before dividends and investments grew 5.2% to €83.4M; recurring FCF up 9.9% to €64.9M.

• CAPEX declined 1.8% year-over-year to €90.3M, mainly due to reduced telco expansionary investment.

Outlook and guidance

• Focus on scaling AI across operations, with 125+ use cases identified and 250+ employees trained in GenAI.

• Confident in continued B2B growth; B2C faces headwinds from no price increases and competitive dynamics.

• No formal guidance on Claranet yet; more details to be provided in Q2.

• Strategic expansion into ICT and tech markets, leveraging inorganic growth and new tech branch.

• Focus remains on innovation, financial discipline, and value creation for stakeholders.