Swisscom AG - ADR

Revenue and EBITDA Performance: Swisscom’s Q1 2025 revenue stood at CHF 3.75 billion, reflecting a slight decline of 1% year-over-year (YoY), primarily due to declines in Switzerland and currency effects (stronger CHF against EUR). EBITDAaL decreased by 6.6% to CHF 1.27 billion. The full-year guidance remains unchanged, forecasting revenue between CHF 15 billion and CHF 15.2 billion and EBITDAaL of around CHF 5 billion.

Integration Progress in Italy: The integration of Vodafone Italia with Fastweb is progressing well, with technical migration of SIM cards and customer activations expected to accelerate in Q3 2025. Management anticipates cost synergies of hundreds of millions by 2026, which could enhance profitability significantly as operational efficiencies take effect.

Challenges in the Swiss Market: Swisscom reported a declining RGU base in broadband (-14,000) and TV due to competitive pressure, and the mobile ARPU continues to decline due to brand shifts towards lower-cost offerings. This is indicative of an increasingly price-sensitive market, and service revenue erosion is expected to be around CHF 100 million for the full year.