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Swisscom AG (CH:SCMN)
:SCMN
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Swisscom AG
(SCMN)
Rating:75Outperform
Price Target:
CHF659.00
▲(14.21% Upside)
Swisscom AG (SCMN) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
CHF30.10B
Dividend Yield3.81%
Average Volume (3M)57.62K
Price to Earnings (P/E)22.6
Beta (1Y)0.28
Revenue Growth17.62%
EPS Growth-21.60%
CountryCH
Employees23,717
SectorServices
Sector StrengthN/A
IndustryTelecommunications Services
Share Statistics
EPS (TTM)5.00
Shares Outstanding51,801,945
10 Day Avg. Volume52,748
30 Day Avg. Volume57,616
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
CHF614.75Price Target Upside6.54% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
Swisscom AG Business Overview & Revenue Model
Company DescriptionSwisscom AG provides telecommunication services primarily in Switzerland, Italy, and internationally. It operates through three segments: Swisscom Switzerland, Fastweb, and Other Operating. The company offers mobile and fixed-network services, such as telephony, broadband, TV, and mobile offerings, as well as sells terminal equipment; and telecom and communications solutions for large corporations and small and medium-sized enterprises. It also provides cloud, outsourcing, workplace, mobile phone, networking, business process optimization, SAP, and security and authentication solutions, as well as a range of services to the banking industry; Internet of Things solutions; digitization services to the healthcare sector; IT systems for health insurance companies; fixed-line and mobile networks by other telecommunication service providers; and roaming to foreign operators whose customers use its mobile networks, as well as broadband services and regulated products. In addition, the company plans, operates, and maintains network infrastructure and IT systems; provides support functions to finance, human resource, and strategy, as well as management of real estate and vehicle fleet; and offers broadband and mobile services, such as telephony, mobile offerings, and broadband services, as well as ICT solutions for residential, business, and wholesale customers. Further, it provides IT and network services; online and telephone directories; and cross-platform retail media and security communication services, as well as builds and maintains wired and wireless networks. The company was founded in 1852 and is based in Bern, Switzerland.
How the Company Makes MoneySwisscom generates revenue through multiple streams, primarily from its telecommunications services, which include mobile communications, fixed-line telephony, and broadband internet access. The company also earns income from IT services and solutions for businesses, including cloud computing and data center services. Additionally, Swisscom has a growing segment in digital entertainment, offering television services and content. Significant partnerships with technology providers and collaborations within the telecommunications ecosystem enhance their service offerings, contributing to revenue growth. Furthermore, Swisscom invests in expanding its network infrastructure, which allows it to attract and retain customers while improving service quality, thus driving sustainable earnings.
Swisscom AG Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The earnings call presents a mixed picture with notable achievements in brand recognition, product launches, and integration progress, particularly in Italy. However, these are counterbalanced by revenue and EBITDAaL declines, significant B2C service revenue erosion in Italy, and ongoing ARPU challenges. The stability in Switzerland provides some reassurance, but challenges remain in both markets.Q2-2025 Updates
Positive Updates
Strong Telco Brand Recognition
Swisscom was nominated as the strongest telco brand in Switzerland and won a Connect Test on the mobile hotline with a record score of 490 out of 500, showcasing outstanding customer service.
Launch of Beem B2B Connectivity Portfolio
Swisscom introduced 'beem,' a new convergent B2B connectivity portfolio that combines connectivity with security, receiving positive market reception and achieving expected sales numbers.
Stable Swiss Business Performance
Swisscom maintains a stable RGU base in Switzerland and confirms the full-year guidance for revenue within CHF 15.0 billion to CHF 15.2 billion.
Successful Integration in Italy
The integration of Fastweb and Vodafone in Italy is progressing as planned, with synergy ramp-up and integration costs on track to meet full-year targets.
Wholesale Business Growth in Italy
Italian wholesale revenues grew by 9% to EUR 173 million, with over 1 million UBB lines sold to wholesale customers.
5G and FTTH Expansion
5G+ coverage increased to 87% in both Switzerland and Italy. FTTH coverage also improved, with 54% coverage in Switzerland and 53% in Italy.
Negative Updates
Revenue and EBITDAaL Decline
Group revenue fell by CHF 173 million in the first half, with a net effect of minus CHF 107 million after currency adjustments. EBITDAaL decreased by CHF 144 million, primarily due to integration costs in Italy.
Italy B2C Service Revenue Erosion
B2C service revenue in Italy declined significantly, with a projected full-year decline at the upper end of EUR 100 million to EUR 200 million range.
Challenges in Swiss B2B IT Growth
Swiss B2B IT service revenue growth was lower than expected due to macroeconomic challenges and customer cost-saving measures.
Ongoing ARPU Decline
ARPU in both Swiss mobile and Italian wireless sectors continues to decline, attributed to a shift towards second brands in Switzerland and ARPU dilution in Italy.
Company Guidance
During the Swisscom Q2 2025 results conference call, the company reaffirmed its full-year guidance despite some fluctuations in performance metrics. Swisscom's revenue is projected to be at the lower end of the CHF 15.0 billion to CHF 15.2 billion range, with an overall decrease of 2.3% in the first half of the year, totaling CHF 7.44 billion. The EBITDAaL (Earnings Before Interest, Taxes, Depreciation, Amortization, and Lease) stood at CHF 2.47 billion, marking a 5.5% decline. In Switzerland, service revenue is expected to decline by approximately CHF 100 million, although this could slightly exceed that estimate based on the current run rate. Swisscom's integration of Vodafone in Italy is progressing as planned, with expected annual mobile COGS synergies of EUR 200 million. Meanwhile, the Italian market is experiencing rationalization, with both Fastweb and Vodafone focusing on value over volume, leading to decreased churn and more stable ARPUs. Energy sales in Italy have doubled, contributing to Swisscom's revenue, although specific figures were not disclosed. Overall, the company is on track with its strategic initiatives, maintaining a focus on value retention and operational stability.Swisscom AG Financial Statement Overview
Summary
Swisscom AG's financial performance is robust, with strong revenue growth and efficient operations. The company maintains a healthy balance sheet with conservative leverage and effective equity utilization. Cash flow generation is strong, supporting ongoing investments and shareholder returns. While profitability margins have slightly decreased, the overall financial health remains solid, positioning Swisscom well for future growth.Income Statement
Swisscom AG demonstrates strong revenue growth with a 7.74% increase in TTM, indicating robust demand in the telecommunications sector. The gross profit margin remains healthy at 68.51%, though slightly lower than previous years, suggesting some cost pressures. The net profit margin of 12.02% is solid, albeit lower than the previous year, reflecting stable profitability. EBIT and EBITDA margins are strong at 16.85% and 41.53%, respectively, indicating efficient operations.85
Very Positive
Balance Sheet
The company maintains a conservative debt-to-equity ratio of 0.31, reflecting prudent financial management. Return on equity is stable at 12.06%, showcasing effective use of shareholder funds. The equity ratio of 32.28% indicates a solid capital structure, though slightly lower than previous years, suggesting increased leverage.78
Positive
Cash Flow
Swisscom AG shows a positive free cash flow growth rate of 7.13% in TTM, highlighting strong cash generation capabilities. The operating cash flow to net income ratio is 3.80, indicating efficient cash conversion. The free cash flow to net income ratio of 0.48 suggests good cash flow management, though there is room for improvement.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.03B | 11.04B | 11.07B | 11.05B | 11.18B | 11.10B |
| Gross Profit | 9.02B | 8.72B | 8.81B | 8.96B | 9.00B | 8.90B |
| EBITDA | 5.48B | 4.46B | 4.55B | 4.43B | 4.71B | 4.35B |
| Net Income | 1.33B | 1.54B | 1.71B | 1.60B | 1.83B | 1.53B |
Balance Sheet | ||||||
| Total Assets | 35.91B | 37.21B | 24.75B | 24.62B | 24.80B | 24.26B |
| Cash, Cash Equivalents and Short-Term Investments | 200.00M | 1.59B | 198.00M | 185.00M | 494.00M | 510.00M |
| Total Debt | 3.73B | 3.64B | 1.92B | 1.91B | 2.02B | 1.99B |
| Total Liabilities | 24.31B | 25.06B | 13.13B | 13.45B | 13.99B | 14.77B |
| Stockholders Equity | 11.59B | 12.15B | 11.62B | 11.17B | 10.81B | 9.49B |
Cash Flow | ||||||
| Free Cash Flow | 2.46B | 1.69B | 1.76B | 1.59B | 1.77B | 1.88B |
| Operating Cash Flow | 5.06B | 3.98B | 4.03B | 3.88B | 4.04B | 4.07B |
| Investing Cash Flow | -9.67B | -9.28B | -2.32B | -2.43B | -2.12B | -2.23B |
| Financing Cash Flow | 489.00M | 6.82B | -1.67B | -1.72B | -1.86B | -1.82B |
Swisscom AG Technical Analysis
Neutral
577.00
Price Trends
571.87
Positive
559.87
Positive
525.97
Positive
Market Momentum
3.57
Positive
51.18
Neutral
24.36
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:SCMN, the sentiment is Neutral. The current price of 577 is below the 20-day moving average (MA) of 583.92, above the 50-day MA of 571.87, and above the 200-day MA of 525.97, indicating a neutral trend. The MACD of 3.57 indicates Positive momentum. The RSI at 51.18 is Neutral, neither overbought nor oversold. The STOCH value of 24.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CH:SCMN.
Swisscom AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Performance Comparison
CH:SCMN
Swisscom AG
577.00
54.45
10.42%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.