Price erosion eats into Sunrise earnings

22 May 2014

Strong competition in Switzerland’s wireless sector has seen Sunrise continue to register declines in its turnover, as price erosion has undermined the impact of the telco’s substantial subscriber growth. Despite increasing its mobile user base by 339,700 to 2.477 million in the twelve months to end-March 2014, revenues from wireless services in the first quarter of 2014 fell by 4.0% year-on-year to CHF291.284 million (USD326.285 million) due primarily to a fall in monthly ARPU from CHF41.0 to CHF35.1. Compounding Sunrise’s troubles, the fixed line telephony segment continues to contract, with subscriptions falling to 426,000 and revenues slumping to CHF127.547 million. Sunrise did see growth in the fixed broadband space, in particular its burgeoning IPTV service but the expansion did little to offset the negative impact of the wireless and fixed voice markets. Sunrise booked total earnings of CHF470.179 million for the three-month month period, down from CHF486.527 million in the corresponding period of 2013, whilst EBITDA dropped to CHF131.979 million from CHF141.243 million.

Switzerland, Sunrise Communications