Telefónica increases losses to 1.355 billion euros but confirms dividend and forecasts

Telefónica recorded losses of €1.355 billion in the first half of the year, adding an additional €51 million to the €1.304 billion loss from the first quarter caused by losses from sales at its Latin American subsidiaries. Nevertheless, the telecommunications company confirmed its €0.30 dividend and its revenue, EBITDA, and operating cash flow forecasts for 2025. Revenue, at €18.013 billion, grew organically by 1.5%. Revenue growth in Spain (+1.9%) and Brazil (+7.1%) stands out.
Telefónica recorded a loss of €51 million in the second quarter of the year, a result that continues to be entirely driven by the divestment of its Latin American businesses. This result stems from continuing operations—those that remain part of Telefónica —which achieved a net profit of €155 million, and from discontinued operations—those that are no longer part of the group, namely Argentina, Peru, Uruguay, and Ecuador—which recorded a loss of €206 million.
Half-year losses amounted to €1.355 billion (the €1.304 billion loss in the first quarter is added to the €51 million loss in the second quarter), with €558 million in profit from continuing operations and €1.913 billion in losses from discontinued operations. These losses do not represent a cash outflow.
Confirms forecasts and dividendOverall, the figures achieved in the first half of the year allow the company to confirm the financial targets set for the whole of 2025, for which it expects year-over-year organic growth in revenue, EBITDA, and EBITDA less capex (operating cash flow), as well as a capex-to-sales ratio of less than 12.5%, cash generation similar to that of 2024, and a reduction in leverage.
Telefónica has also confirmed the distribution of a cash dividend of 0.30 euros per share for 2025, payable in two installments: the first on December 18 (0.15 euros) and the second in June 2026 (0.15 euros).
Organic growthTelefónica posted revenues of €8.953 billion between April and June and €18.013 billion in the first half of the year, with an organic increase of 1.5% in both the second quarter and the half-year as a whole. On a reported basis, and as a result of exchange rate fluctuations, quarterly revenues decreased by 3.7% and half-year revenues decreased by 3.3%.
By segment, the residential business (B2C) generated revenue of €5.323 billion in the second quarter, with organic growth of 2.1%, and the business-to-business business (B2B) contributed €2.021 billion, with organic growth of 5.2%. Wholesale revenues represented €1.609 billion in the second quarter.
Spain grows by 1.9%By market, Telefónica Spain increased its revenue by 1.9% in the second quarter and achieved its highest net customer gain since the third quarter of 2018. Telefónica Brazil achieved a sequential improvement in its quarterly results in local currency, both in revenue (+7.1%) and EBITDA (+8.6%), thus achieving its highest growth since December 2023. And Telefónica Germany has recorded a good commercial momentum in its mobile business, allowing it to achieve a net profit 12.1% higher than in the first quarter of the year.
Adjusted EBITDA for the second quarter increased by 1.2% to €2.921 billion, with a 0.8% increase in the first six months of the year, to €5.867 billion. However, exchange rates caused reported EBITDA to fall by 4.8% and 4.6%, respectively.
Telefónica Tech increased its revenue by 12.5% in the second quarter, reaching €566 million. In the first half of the year, it achieved sales of €1.074 billion, an increase of 9.6%.
Cash generationInvestment for the first six months of the year reached €2.003 billion, down 1.9% year-over-year in organic terms (-6.8%), meaning the investment-to-sales ratio stood at 11.1%, within the target for the full year.
Operating cash flow (EBITDA/capex) reached €2.58 billion in the first half of the year, stable in organic terms and 5.9% lower in reported terms due to the impact of exchange rates.
On the other hand, free cash flow (FCF) reached €505 million in the second quarter, compared to €213 million in the first quarter, closing June with a total of €291 million, due to the seasonality typical of the first half of the year.
Debt falls by 5.5%Net financial debt decreased by 5.5% year-on-year, reaching €27.609 billion as of June 30. Long-term financing activity in the first half of the year, amounting to €7.593 billion, enabled the bank to maintain a liquidity position of €18.649 billion, maturity coverage of more than three years, and an average debt life of 10.9 years.
Expansion