Swisscom AG (SCMWY) Q3 2024 Earnings Call Highlights: Navigating Challenges with Strategic ...

GuruFocus News
4 min read

In This Article:

  • Q3 Revenue: CHF 2.7 billion, a reported decrease of 1.2%.

  • EBITDA: CHF 1.15 billion, down 1.3%.

  • Mobile Net Additions in Switzerland: +35,000 connections in Q3.

  • Broadband Connections in Switzerland: Decrease of 9,000, offset by wholesale growth of 10,000 connections.

  • Mobile Net Additions in Italy: +92,000 connections in Q3.

  • Fastweb Revenue Growth: 4.7% increase in Q3.

  • CapEx: Up CHF 101 million year-to-date, primarily due to increased FTTH rollout in Switzerland.

  • Operating Free Cash Flow: Down CHF 140 million year-to-date.

  • B2C Revenue in Italy: CHF 292 million in Q3, a 1% increase.

  • B2B Revenue in Italy: CHF 304 million in Q3, a 6% increase.

  • Wholesale Revenue in Italy: EUR 95 million in Q3, a 13% increase.

  • Net Income: Slightly down CHF 28 million year-over-year.

  • Full Year Guidance: Confirmed for revenue, EBITDA, CapEx, and dividend.

Release Date: October 31, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Swisscom AG (SCMWY) confirmed its full-year guidance for 2024, indicating stability in its financial outlook.

  • The company achieved significant milestones in its network expansion, covering over 50% of Switzerland with fiber-to-the-home (FTTH) and increasing 5G coverage to 85% of the population.

  • Fastweb, Swisscom AG (SCMWY)'s Italian subsidiary, continues to show strong growth, particularly in mobile and wholesale segments, contributing positively to overall revenue.

  • The company is actively working on cost savings through automation and AI, which are expected to improve efficiency and reduce operational costs.

  • Swisscom AG (SCMWY) launched new products and services, including energy offerings in Italy and a loyalty program in Switzerland, aimed at enhancing customer engagement and generating additional revenue streams.

Negative Points

  • Swisscom AG (SCMWY) reported a slight decrease in Q3 revenue and EBITDA, with a 1.2% and 1.3% decline respectively, indicating some financial pressure.

  • The competitive environment in Switzerland remains highly promotional, impacting service revenue trends and ARPU, particularly in the consumer fixed line segment.

  • The company faces challenges in stabilizing broadband connections in Switzerland, with a reported loss of 9,000 connections in Q3.

  • There is ongoing pressure in the B2B segment with a 2.9% decrease in telco service revenue, driven by decreasing prices.

  • The Vodafone Italia acquisition is still under regulatory review, with potential delays due to a Phase 2 investigation by the Italian Competition Authority.

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