Swisscom beats first quarter profit expectations
Swisscom’s Q1 2024 Financial Performance and Outlook
By Cian Muenster
May 7 (Reuters) - Switzerland's main telecoms provider Swisscom beat first-quarter core profit expectations on Thursday on strong sales, while signalling easing subscriber pressure after recent price increases.
Financial Results Overview
Group core profit after lease expenses (EBITDAaL) rose 0.8% to 1.288 billion Swiss francs ($1.65 billion), beating a company-compiled consensus of 1.257 billion francs. In constant currency terms, adjusted for the strength of the Swiss franc, sales grew by 1.3%.
Revenue and Currency Impact
Revenue fell by 4.1% to 3.61 billion francs compared with the same period in the previous year. It was down 2.9% when adjusted for currency effects.
Subscriber Trends and Market Position
Customer Churn and Price Increases
CEO Christoph Aeschlimann said customer churn in Switzerland linked to the company's price increases had begun to stabilize. "I think so far, what we've seen post or in Q2 is that churn has sort of reverted back to where it used to be ... but we still need to observe one or two months more" Aeschlimann told a conference call.
Competitive Landscape
Price increases by Swiss rivals Sunrise Communications and Salt are not assumed in Swisscom's 2026 outlook, he said.
Market Coverage
Swisscom covers 56% of Swiss households and businesses with optical fibre and 89% of the population with 5G, the company said. Italy is its other major market, accounting for around 45% of group revenue.
Outlook and Future Plans
Dividend and Spectrum Auction
The group affirmed its 2026 outlook, saying it plans to increase its dividend to 27 francs per share, payable in 2027 if its targets are achieved.
It also said it was awaiting final rules for Switzerland’s 2027 mobile spectrum auction, which will shape costs and investment requirements for operators, expecting these to be released this summer.
Additional Information
($1 = 0.7788 Swiss francs)
(Reporting by Cian Muenster; Editing by Sherry Jacob-Phillips, Subhranshu Sahu and Susan Fenton)
