Telefonica Reports Net Loss for Fourth Quarter, Forecasts Higher Revenue and Earnings
Telefonica, the Spanish telecommunications group, has reported a net loss of 2.15 billion euros for the fourth quarter. This is a significant swing from the year-earlier period when the company made a profit of EUR525 million. The losses can be attributed to one-off charges at its Spanish business and its U.K. joint venture, Virgin Media-O2.
The fourth-quarter revenue for Telefonica was down 0.5% at EUR10.15 billion. However, underlying operating income before depreciation and amortization (Oibda) saw a rise of 1.6% to EUR3.47 billion. Notably, Telefonica’s Spanish business experienced a small increase in underlying Oibda, marking its first growth since 2019.
Analysts had forecasted revenue of EUR9.99 billion, underlying Oibda of EUR3.335 billion, and a net loss of EUR742 million. Despite the losses, Telefonica is optimistic about the future and has forecasted higher revenue and earnings for this year.
Looking ahead to 2024, Telefonica expects growth of approximately 1% in revenue and an increase in earnings before interest, taxes, depreciation, and amortization (EBITDA) of between 1% and 2%.
In a positive move for shareholders, the company’s board has declared a final dividend for 2023 of EUR0.15 per share and intends to pay dividends totaling EUR0.30 per share for 2024.
These financial results reflect Telefonica’s efforts to navigate challenging market conditions and position itself for future growth in the telecommunications industry.
Analyst comment
Positive news.
As an analyst, I predict that the market will respond positively to Telefonica’s forecasted higher revenue and earnings for this year, as well as its expected growth in revenue and EBITDA in 2024. The declaration of dividends for shareholders is also a positive move. Telefonica’s efforts to navigate challenging market conditions and position itself for future growth should be well-received by investors.
