Telefonica put a sharp Q3 revenue decline down to the impact of Covid-19 (coronavirus) and intensifying foreign exchange headwinds, while it remained in the red due to an impairment in Argentina.

The company posted a year-on-year revenue decline of 12.1 per cent to €10.5 billion, citing the pandemic and currency difficulties, and reported a net loss of €160 million due to an impairment allocated to Telefonica Argentina, albeit this was narrowed from a €443 million loss in Q3 2019.

In a statement, CEO and chairman Jose Maria Alvarez Pallete remained optimistic, declaring the company was showing “strength in the midst of an unusual situation”.

“Thanks to the implementation of the strategy presented a year ago and the robustness of our business, trends are improving in the third quarter, with a clear recovery in commercial activity in our key markets. We are growing in revenue compared to the previous quarter. Furthermore, we continue to optimise the operating cash flow and move forward in line with our objective,” he said.

Breaking down its four key markets, revenue in home market Spain dropped 4.3 per cent to €3.1 billion, put down to reduced roaming, although it was boosted by fibre take up.

In the UK, revenue hit €1.6 billion, down slightly from €1.8 billion, Brazil fell to €1.7 billion from €2.5 billion and Germany remained flat at €1.8 billion.

Allianz partnership
Separately, the company also confirmed a partnership with the Allianz Group to establish a 50-50 joint venture to deploy fibre to the home services in Germany.

In a statement, the companies said they aimed to deploy fibre in 2 million homes in rural and semi-rural areas, committing to an investment of €5 billion.