27.02.2025
Annual results 2024:Successful strategy execution driving operating results growth at O2 Telefónica
O2 Telefónica closed the 2024 financial year with a strong operating result (EBITDA)
- Telecommunications provider successfully closes financial year 2024 and grows faster than the market with new contract customers
- Margin improved on back of continued high customer growth and effective cost management. EBITDA for the first time exceeds 2.7 billion euros
- O2 brand underpins price-value leadership position. Partner business benefits from new cooperations
Statement Markus Haas, CEO O2 Telefónica
"In a highly competitive market, O2 Telefónica has achieved its strategic goals with strong customer growth and increased operating result. We have expanded our 5G network in record time and brought digital innovations to the market for the benefit of our customers. We are thus making a significant contribution to the digitalization of Germany. We have made the company even more resilient in 2024 and laid the foundation for further profitable growth with an expanded partner business and a new portfolio for our core brand O2," says Markus Haas, CEO of O2 Telefónica.
New customer growth with ongoing momentum
The new “O2 Mobile” portfolio also includes the popular Grow advantage
In financial year 2024, a net total of 824,000 additional customers opted for a mobile contract on the O2 Telefónica network, making the company one of the growth leaders in the German market. The positive development was mainly driven by the strong core brand O2. O2's successful family offers in the first half of the year contributed to this, as did the continued low monthly churn rate. At the same time, the O2 brand further sharpened its positioning as a particularly customer-friendly telecommunications brand in the 2024 financial year. Among other things, O2 offered the popular Grow advantage to millions of existing contract customers, automatically and at no extra charge. The new "O2 Mobile" portfolio with a simplified tariff structure and additional inclusive volume was also launched in fall.
Strategic refinement of the business customer segment and the partner business
In addition to the growth impetus in the consumer business, the company expects growth in the partner business and with business customers. In the past financial year, the company substantially expanded its business with partners and made it more resilient. This includes the expansion and extension of the contract with Freenet and the expansion of business relationships with the international mobile provider Lebara. O2 Telefonica has gained a new partner in Lyca Mobile. These measures are already having a positive impact on customer growth in the second half of 2024.
O2 Telefónica expects growth in the partner business and with business customers
The company has linked the business customer segment more closely to the technology organization. Together with the major advances in network quality and IT infrastructure, O2 Telefónica has thus created the conditions for above-average growth in business with commercial enterprises and customers at municipal and state level. In addition to pure connectivity, services such as innovative end device rental and digital security solutions are also providing approaches for growth in new fields.
The activities in the various customer segments are key components of the "Accelerated Growth & Efficiency Plan". The strategic plan aims to make the company's business model even more resilient and to generate further profitable growth with its own customers and partners in conjunction with a strong cash flow by 2026.
Achieved strong EBITDA growth
New level: Strong customer growth and effective cost management improve profitability and operating result (EBTIDA)
Revenue in the 2024 financial year was primarily impacted by negative regulatory effects and, at EUR 8.492 billion including regulatory effects, was 1.4% below previous year's figure. Mobile service revenue (MSR) was also negatively impacted by the halving of mobile termination fees at the beginning of 2024 and declined 1.4% to EUR 5.812 billion. Excluding these regulatory effects, both, revenue and MSR were flattish versus previous year's level. O2 Telefonica thus gained further MSR market share in German mobile. Revenues in the fixed-line business continued to grow and recorded an increase of 3.6% to EUR 857 million. Revenue development was held back by the decline in hardware revenue, which was below previous year's record figure while in line with the market trend. Hardware sales fell by 4.7% to 1.785 billion euros after an exceptionally strong previous year.
Earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted for special effects, rose by 3.8%, exceeding EUR 2.7 billion for the first time. This is mainly reflecting strong customer growth and efficiency measures. These included, above all, effects of the company's digital transformation, such as the increased use of artificial intelligence in the network and in customer service. The EBITDA margin improved to 32.0% after 30.4% in the same period of previous year.
Billion euro investment driving network expansion
Network technicians put a new mobile site into operation along the highway
In 2024, O2 Telefónica invested more than one billion euros in its network and services, slightly more than in the previous year. With more than 7,500 expansion measures, the company further improved its very good mobile network and once again exceeded the number of previous year of 7,000 measures. This enables the 45 million customers to surf the Internet and make phone calls almost everywhere where people live, work and travel in Germany. The expanded network meets the growing demand for mobile telephony and data usage. With over 5.6 billion gigabytes, the O2 Telefónica network transports by far the largest data volume of all German mobile communications provider.
O2 Telefónica's modern 5G network now reaches more than 97% of the population. In addition, the network engineers have pushed ahead with the expansion in rural and previously underserved regions. Around 1,000 new sites are closing white spots and densifying the network in metropolitan areas. That is a third more sites than those realized in previous year.
"With our high-performance network, well-established own brands as well as existing and new partners, we are well positioned for the future despite a challenging market environment," says CEO Markus Haas.
Video and downloads
| O2 Telefónica is a leading full-service provider of telecommunications services for private and business customers. The portfolio of the core brand O2 and various secondary and partner brands includes traditional telephony and internet connections as well as innovative digital services in the area of the Internet of Things and data analysis. In mobile communications, O2 Telefónica manages more than 45 million mobile lines (incl. M2M - as at 31.12.2024). No network operator connects more people in this country. The company's high-performance and award-winning mobile network reaches more than 99 percent of the population. In the fixed network, O2 Telefónica offers its customers leading technological diversity and geographical availability in Germany. In the 2024 financial year, the company generated revenue of 8.5 billion euros with around 7,500 employees. The company is majority-owned by the Spanish telecommunications group Telefónica S.A., based in Madrid, one of the largest telecommunications groups in the world. |