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Investing.com -- Swisscom ’s (SIX:SCMN) net income fell 19.3% in the first quarter of 2025 to CHF 367 million on Thursday, as higher integration costs from Vodafone (NASDAQ:VOD) Italia and declining revenue in Switzerland impacted its performance.
The company reported a 1.2% drop in pro forma group revenue to CHF 3.76 billion and a 6.6% decline in EBITDA after lease expense to CHF 1.28 billion.
The integration of Vodafone Italia, while driving overall revenue growth, has yet to generate synergies to offset the costs associated with the acquisition.
Revenue from the Swiss segment decreased by 1.2% to CHF 1.96 billion, with telecom service revenue falling 2% to CHF 1.29 billion. Despite this, cost-saving measures helped mitigate some losses.
In Switzerland, IT services for business customers grew by 2.4%, while adjusted EBITDAaL remained stable at CHF 865 million.
Postpaid mobile lines in Switzerland rose by 2.8% to 5.51 million, while fixed-line broadband connections fell 1.9% to 1.95 million.
Swisscom’s 5G+ network now covers 86% of the population, with fiber-optic coverage reaching 53% of households and businesses.
In Italy, revenue remained almost flat at EUR 1.82 billion, down 0.4% from last year. Revenue from residential customers fell 2.6%, while business customer revenue rose 2.7%.
Adjusted EBITDAaL in Italy dropped 10.8%, but operating free cash flow increased 16.3% to EUR 57 million due to lower investment spending. Mobile access lines for residential customers fell 2.6%, while business mobile lines grew 12.3%.
Swisscom also joined the Joint Alliance for CSR, committing to improving working conditions in its global supply chain. The company audited 32,000 jobs in Q1 and aims to reach 150,000 by year-end.
For 2025, Swisscom confirmed a revenue forecast of CHF 15 to CHF 15.2 billion and EBITDAaL of around CHF 5 billion.
It also plans to propose raising the dividend to CHF 26 per share in 2026, pending target achievement.