Shareholders’ letter

Strong today – even stronger tomorrow

Dear shareholders

Swisscom is on track. And it has achieved this in a time that continues to be shaped by uncertainty, geopolitical tensions, global economic challenges and technological and environmental change. We’re going strong thanks, not least, to Fastweb, which is performing very well. We’re now further strengthening our position in Italy. The acquisition of Vodafone Italia is an important step for us and sets the course for future success.

Digitalisation and artificial intelligence (AI) offer enormous opportunities for Switzerland. However, the general public only use these if they can trust the new technologies and responsible handling of data is ensured. This is where Swisscom comes in. We want to be ‘Innovators of Trust’ for our customers and Switzerland. Innovation and trust – these are the keywords for Swisscom’s success. For example, during the year under review we launched an AI platform for business customers with Swiss AI Platform. Our customers can use it to develop their own KI solutions with guaranteed data storage in Switzerland. The topic of digital trust is another focus of innovation. This includes, for example, Swisscom Sign: the only qualified electronic signature considered equivalent to a handwritten signature. In spring 2024, we expanded our range of services to companies so that they can electronically sign contracts and documents simply and with legal effect.

Innovation is a recipe for success not just for Swisscom but for Switzerland as a whole. So that our country will remain the world champion in innovation, Swisscom established the Deep Tech Nation Switzerland Foundation together with UBS. The foundation promotes highly innovative technologies and improves access to venture capital for start-ups and scale-ups so that brilliant ideas become successful companies, thus strengthening Switzerland’s competitiveness.

The best network – expansion continues

Our outstanding infrastructure is and remains the foundation of our success. In 2024, we reached a milestone in optical fibre expansion. Today, more than half of Swiss households and businesses benefit from Fibre to the Home. Mobile communication expansion remains challenging. Although the majority of Swiss people use a smartphone or tablet when out and about, antennas continue to meet with resistance. Various Swiss Federal Supreme Court decisions have resulted in significantly more modifications to mobile communications systems needing to be assessed in regular building permit procedures, even if radiation decreases. This is curbing network expansion. We will, of course, continue to do our utmost to provide our customers with the best network. We succeeded in doing this in the year under review: Swisscom has once again won all the network and service tests.

Fastweb is growing – acquisition of Vodafone Italia strengthens Swisscom

In Italy, Fastweb is again increasing its revenue and result. For years, we have been able to achieve our goals together and deliver good financial results in a challenging market thanks to innovation. In the year under review, Fastweb again systematically took advantage of opportunities and, for instance, entered the energy market by selling electricity subscriptions.

We are now writing the next chapter of our Italian business’s success story. In March 2024, we announced the acquisition of Vodafone Italia and its merger with Fastweb. On 31 December 2024, we successfully completed the acquisition after receiving all the necessary regulatory approvals. The Italian mobile operator has been part of the Swisscom Group since the start of January. Vodafone Italia is an excellent fit for Fastweb – and for Swisscom. Vodafone Italia brings a strong mobile network and Fastweb brings access to a state-of-the-art fixed network. The merger means that the new company will be able to offer customers the best convergent services. The Vodafone Italia acquisition strengthens our position and contributes to our strategy. We want to inspire customers, drive innovation, grow and exploit cost and innovation synergies. We believe that strengthening our Italian business is an important step for the successful future of Swisscom as a group and creates added value for our investors.

Solid figures

Our focus is on constant and long-term value creation. Swisscom achieved good financial results in 2024. With a slightly lower revenue of CHF 11,036 million (–0.3%) and operating income (EBITDA) of CHF 4,355 million (–5.8%), it generated net income of CHF 1,541 million (–9.9%). On a like-for-like basis and at constant exchange rates, revenue rose by 0.2%. As a result of the acquisition of Vodafone Italia on 31 December 2024, integration and transactions costs of CHF 227 million were recognised in the 2024 financial year. Without these costs and other non-recurring items and at constant exchange rates, the decrease in EBITDA was 1.0%. Swisscom’s share price remained stable during the year under review at CHF 504.50 (–0.3%). The total shareholder return (TSR) based on the increase in the share price and distributions over the last five years was positive at 21%.

Looking ahead to 2025, Swisscom expects revenue of around CHF 15.0 billion to CHF 15.2 billion, EBITDA after lease expense (EBITDAaL) of around CHF 5.0 billion and capital expenditure between CHF 3.1 billion and CHF 3.2 billion (around CHF 1.7 billion of which will be in Switzerland). Subject to achieving its targets, Swisscom plans to now propose a dividend of CHF 26 per share for the 2025 financial year at the 2026 Annual General Meeting.

Many thanks

We can look back at a solid year. We were able to set the course in the right direction for an even stronger future. We would like to express our heartfelt thanks to you, our employees and colleagues. You work hard for our customers every day with a great deal of passion and expertise. Many thanks also to you, our shareholders, for your trust in, loyalty to and support for our company. Together, we are driving Swisscom forward.

Kind regards,

Michael Rechsteiner

Chairman of the Board of Directors

Swisscom Ltd

Christoph Aeschlimann