Telefónica maintains outlook after Q1 beat

The company, which owns Movistar, Vivo, Telxius, O2 Germany and 50% of Virgin Media O2 in the UK, said it still expects to grow revenues by "around 1%" in 2024, with EBITDA and operating cash flow estimated to increase by 1-2%.

“We have started the year with a solid strengthening of our business, supported by the deployment of our new roadmap, the GPS strategic plan which will guide Telefónica until 2026," said Telefónica chairman José María Álvarez-Pallete.

"Revenue is improving, commercial activity is improving and the quality of the service we provide to our customers and their satisfaction is also improving."

Net income in the first quarter totalled €532m, up 78.9% on the first quarter of 2023, after the company booked a profit from investments compared with a big loss the previous year.

Group revenues were up 0.9% year-on-year at €10.14bn, as a 2.3% increase in service revenues outweighed a 9.5% decline in handset sales. B2C revenues, which make up 61% of the business, rose by just 0.8% to €6.23bn, while B2B revenues gained 2.8% to €1.9bn, and wholesale, partners and other revenue fell 0.9% to €1.73bn.

Consensus forecasts were for revenues of $10.07bn and a net profit of €388m.

Telefónica said it ended the quarter with 388.3m customers, up 1% on last year, with fibre and mobile contract numbers rising 12% and 3% respectively.

Despite the better-than-expected first-quarter headline numbers, the stock was flat at €4.19 by midday in Madrid, having jumped more than 15% so far this year.