Weak domestic demand hits Telecom Italia – Mobile World Live

Weak domestic demand hits Telecom Italia

09 NOV 2012

Telecom Italia (TI) reported drops in revenue and profit for the third quarter of 2012 as reduced domestic market demand was only partially offset by good performances in Brazil and Argentina.

The Italy segment contracted by 7.9 percent in organic terms compared to the third quarter in 2011 while TI’s Brazilian business grew by 8.0 percent with Argentina growing by 18.2 percent.

Profit for the period was EUR681 million, a 13.4 percent decrease on the same period in 2011. Consolidated group revenue for was EUR7.27 billion, down 3.3 percent compared to the same period. The figures beat Bloomberg analyst estimates of a EUR664 million profit.

The third quarter was also affected by the enforcement of a 53 percent reduction in mobile termination rates and price caps for roaming in Europe, according to TI chairman Franco Bernabè

“2012 continues to suffer from recessionary tensions in the domestic market and from an economic slowdown in Latin American countries. Despite these adverse factors, the Group continues to pursue its goals of increasing revenues and preserving profits,” said Bernabè.

Bernabè added that the company is continually improving operating efficiency which will allow it to deliver on its commitment to develop next-generation networks. TI has also improved domestic ARPU through the development of new offers and services.

Telecom Italia launched its LTE service in some markets on 7 November.

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Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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