Viaplay Group (VPLAY) Q3 2024 earnings summary

Executive summary

• Q3 2024 results aligned with expectations, with a focus on performance improvements, cost control, and profitable growth, while full-year guidance remained unchanged.

• Organic sales growth for core operations reached 6%, driven by content sales, sublicensing, and linear channel subscriptions, despite a slight decline in total reported net sales year-over-year.

• EBIT losses narrowed year-on-year and sequentially due to cost reduction and improved content monetization.

• The group continued to exit non-core markets, finalizing the sale of the UK business and progressing on the exit from the Baltics and Poland.

• D2C ARPU increased year-on-year in all core markets, reflecting a focus on value over volume.

Financial highlights

• Core net sales were SEK 4,209m in Q3 2024, flat year-on-year; total reported Group net sales were SEK 4,412m.

• Core operating income (ex ACI & IAC) improved to SEK -49m from SEK -112m year-on-year; group operating income (ex ACI & IAC) was SEK -56m, up from SEK -321m.

• Net income for the period was SEK -148m, compared to SEK -693m in Q3 2023.

• Group free cash flow was SEK -1,523m, with core at SEK -1,561m and non-core at SEK 38m.

• Financial net debt stood at SEK 1,202m at quarter-end; total borrowings at SEK 2,478m.

Outlook and guidance

• Full-year 2024 guidance unchanged: core net sales of SEK 17.2–17.8bn, EBIT (ex IAC & ACI) between SEK -250m and SEK 50m, and group free cash flow of negative SEK 1.7–2.2bn.

• Non-core operations expected to report sales of SEK 0.8–1.0bn, an operating loss of SEK 0.1bn, and negative free cash flow of SEK 0.6–0.8bn for 2024.

• Targeting positive free cash flow for core operations in 2025 and for the group by 2027, with low- to mid-single-digit revenue growth and double-digit operating margin within five years.