Spain's Telefónica rings in net loss in 2023 as staff cuts weigh
Spanish telecoms giant Telefónica said Thursday it swung to a loss in 2023 despite higher revenue after making provisions for layoffs in its domestic business.
The company booked a net loss of €892 million last year, compared to net profit of nearly two billion euros the previous year.
Telefónica said the results reflected a provision of €1.3 billion for a plan which will see it cut up to one-fifth of its domestic workforce as part of cost-cutting efforts.
The group also took a €1.8 billion hit from writing down the value of its British unit VMO2.
Without these one-off charges, Telefónica said it would have recorded a net profit of €2.37 billion in 2023, a 17.1 percent increase over the previous year.
Revenues rose 1.6 percent to €40.65 billion last year. Spain accounted for 27 percent of revenue, followed by Brazil at 21 percent and Germany with 18 percent.
Under a major restructuring announced in 2019, Telefonica has focused on the key markets of Brazil, Britain, Germany and Spain where it sees greater chances to grow sustainably in the long term.
"Telefónica continues to execute its roadmap, not stopping against global macroeconomic uncertainty, with the necessary ambition and determination," Telefonica Chief Executive José María Álvarez-Pallete said in a statement, adding the company had "met all its financial targets" last year.
The earnings come as Telefonica is facing stiffer competition in its domestic market after the EU on Tuesday approved the merger of French telecoms giant Orange's Spanish operations and Spanish rival Mas Móvil that will create the biggest mobile operator in Spain.
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The company booked a net loss of €892 million last year, compared to net profit of nearly two billion euros the previous year.
Telefónica said the results reflected a provision of €1.3 billion for a plan which will see it cut up to one-fifth of its domestic workforce as part of cost-cutting efforts.
The group also took a €1.8 billion hit from writing down the value of its British unit VMO2.
Without these one-off charges, Telefónica said it would have recorded a net profit of €2.37 billion in 2023, a 17.1 percent increase over the previous year.
Revenues rose 1.6 percent to €40.65 billion last year. Spain accounted for 27 percent of revenue, followed by Brazil at 21 percent and Germany with 18 percent.
Under a major restructuring announced in 2019, Telefonica has focused on the key markets of Brazil, Britain, Germany and Spain where it sees greater chances to grow sustainably in the long term.
"Telefónica continues to execute its roadmap, not stopping against global macroeconomic uncertainty, with the necessary ambition and determination," Telefonica Chief Executive José María Álvarez-Pallete said in a statement, adding the company had "met all its financial targets" last year.
The earnings come as Telefonica is facing stiffer competition in its domestic market after the EU on Tuesday approved the merger of French telecoms giant Orange's Spanish operations and Spanish rival Mas Móvil that will create the biggest mobile operator in Spain.
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