Viaplay Group (VPLAY) Q4 2024 earnings summary

Executive summary

• Q4 and full-year results aligned with expectations and guidance, supporting a long-term turnaround strategy focused on cost control, content optimization, and monetization improvements.

• Achieved 5% organic sales growth in core operations, with core D2C ARPU and subscriber base both increasing year-on-year, driven by sports packages, HVOD tier expansion, and value-focused pricing.

• Account sharing restrictions and anti-piracy measures are delivering early positive results, boosting engagement and monetization.

• Non-core operations losses were controlled, with net sales of SEK 198m and EBIT of SEK -36m in Q4; exit from Poland planned for mid-2025.

• Organisational restructuring and a new country-based operating model implemented to drive sustainable transformation.

Financial highlights

• Core net sales reached SEK 4,638m in Q4 2024, up from SEK 4,566m in Q4 2023; FY 2024 core net sales were SEK 17,598m.

• Group operating income before ACI and IAC was SEK 174m in Q4 2024, compared to SEK -230m in Q4 2023; core EBIT (ex ACI & IAC) was SEK 210m.

• Net income for Q4 2024 was SEK -230m, a significant improvement from SEK -2,881m in Q4 2023.

• Group free cash flow was SEK 384m in Q4 2024, with SEK 845m from core and SEK -462m from non-core operations; full-year free cash flow was negative SEK 2 billion, within guidance.

• Financial net debt reduced to SEK 829m at quarter-end, down from SEK 4,681m a year earlier; total net debt including leases was SEK 1,113m.

Outlook and guidance

• 2025 targets: low- to mid-single-digit revenue growth and positive free cash flow for core operations, with group-level positive free cash flow targeted by 2027.

• Double-digit operating profit margins targeted for 2028.

• Non-core operations expected to have a SEK 0.5 billion cash drag in 2025, with phased reductions over 2024-2028.

• Continued focus on strict cost control, content cost optimization, and working capital efficiency.

• FX volatility and limited hedging remain risks, with significant unhedged exposure to USD, EUR, and NOK.