Numbers revealed at telco’s half-year results which were boosted by Fastweb in Italy
Swisscom said it can provide more than 77% of the Swiss population with 5G+ [up to 2Gbps]. According to the industry association asut, 4.6 million 5G-enabled devices were in operation in Switzerland at the end of June 2023.
The numbers were revealed at the telco’s half-year results which saw Group revenue fall slightly by 0.3% to CHF5.450bn, which translated into an increase of 0.5% at constant exchange rates.
In its domestic core business, revenue fell slightly by 0.6% to CHF4.04bn. Revenue from telecommunications services decreased by 1.2% to CHF2.7bn. In contrast, revenue from IT services with business customers rose by 1.6% to CHF583m.
“I’m proud of our strong financial result and solid market performance in the first half of 2023,” said CEO Christoph Aeschlimann. “Although we have been unable to escape the current inflation unscathed, we are using efficient cost management to cushion the blow of rising costs.”
FTTH expansion continues
Swisscom made the decision at the end of 2022 to employ the point-to-point (P2P) architecture for new connections in its fibre network expansion and to convert existing P2MP connections into P2P in the current rollout. The telco will have increased fibre-optic coverage (FTTH) to around 55% by the end of 2025, and to 70-80% by 2030. As a result, its capex of CHF1.11bn was up on the level of the previous year (+5.7%).
Most residential subscribers (2.01m) have signed up to one of Swisscom’s so-called blue offerings. The blue brand now accounts for 48% of all mobile subscriptions and 80% of fixed-line broadband connections. The number of Swisscom fixed-line broadband connections fell by 0.7% YoY to 2.01m connections, with the number of TV connections dropping by 2.1% to 1.55m. The telco suggested this was indicative of a saturated market.
Despite inflation, Aeschlimann said Swisscom is maintaining stable prices for its blue offering (prepaid and postpaid), internet, TV and fixed network subscriptions, as well as secondary and third-party brands, and will not implement any general price increases until the end of 2024.
Revenue from consumer telecommunications services remained more or less stable at CHF1.9bn (-0.4%). The number of postpaid Swisscom mobile lines increased by 164,000 YoY, while the number of prepaid lines decreased by 126,000. The total number of mobile lines rose by 0.6% to 6.20m.
Business market faces usual competitive issues
Swisscom like all telcos providing enterprise services is seeing legacy services squeezed while new offers like cloud, security, IoT and SAP growing. Telecommunications services revenue was down by 3.1% YoY to CHF770m.
The telco has further expanded its capacities in the IT business, acquiring Axept Business Software. Revenue from IT services rose by 1.6% in the first half of 2023 to CHF583m.
Fastweb increases customers, revenue and EBITDA
Fastweb increased revenue in local currency terms by 4.3% to €1.25bn. EBITDA on a comparable basis rose by €8m (+2%).
In mobile, the number of connections increased by 19.2% YoY to 3.34m. The wireline customer base (retail and wholesale) grew by 2.1% to 3.16m.
Although the retail customer base in the broadband business fell slightly by 3% to 2.63m, the number of lines provided by Fastweb to other operators grew, now reaching 532,000 (+37.8%). Bundled retail offers continue to play an important role, with 42% of customers using a package combining fixed network and mobile services.
Residential customers revenues increased by 1.4% to €580m, while revenues in the business customer segment grew by 6.0% to €527m. Wholesale revenues also increased, by 10.8% to €144m.
Swisscom confirmed its 2023 outlook for net revenue of CHF11.1-11.2bn francs and EBITDA of CHF4.6-4.7bn.