Telefónica (TEF) Q4 2024 earnings summary

Executive summary

• Achieved all 2024 guidance metrics, with revenue up 1.6% year-over-year to €41,315 million, EBITDA up 1.2%, and free cash flow up 14.1%.

• Net financial debt reduced to €27,161 million, leverage at 2.58x EBITDAAL, and dividend of €0.30/share confirmed for 2024 and 2025.

• Strategic review underway, focusing on core markets, operational excellence, and reduced exposure to Hispam, with conclusion expected in H2 2025.

• Portfolio optimization advanced with the sale of Argentina for €1.2 billion and insolvency filing in Peru, reducing Hispam exposure.

• Customer base grew to 390 million, maintaining leadership in 5G and fiber.

Financial highlights

• Free cash flow reached €2,634 million, up 14.1% year-over-year, exceeding guidance.

• Revenue grew 1.6% to €41,315 million; Q4 revenue up 5.4% year-over-year.

• EBITDA rose 1.2% to €13,276 million; CapEx-to-revenue ratio at 12.9%.

• Net financial debt at €27,161 million; liquidity position over €20.8 billion; average debt life 11.3 years.

• Dividend of €0.30/share in two tranches; leverage at 2.58x ND/EBITDAAL.

Outlook and guidance

• 2025 guidance targets organic growth in revenue, EBITDA, and EBITDAAL minus CapEx.

• CapEx/Sales expected below 12.5%; free cash flow to remain similar to 2024.

• Dividend of €0.30/share in cash for 2025, paid in two tranches; focus on leverage reduction and liquidity.

• Strategic review to conclude in H2 2025, with disciplined execution and capital allocation.