Telia shares slide as weak advertising market weighs on results

Shares in Swedish telecom operator Telia TELIA slid by more than 6% on Thursday after first-quarter core earnings narrowly missed expectations as a weak advertising market continues to weigh on profitability.

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose 3.4% from a year earlier to 7.14 billion Swedish crowns($656.90 million), just short of the 7.24 billion crowns consensus from analysts in an LSEG poll.

Telia continues to grapple with challenges in its TV and media businesses, mostly because of low advertising revenue.

"The tailwind is still the advertising market that we have against us and we hope that it will be a bit better in the second half," CEO Patrik Hofbauer told Reuters.

The Swedish telecoms and TV operator registered a 6.3% decline in advertising revenue, partly offset by 5.2% growth in pay TV revenue.

Hofbauer said the company had improved performance in its digital services, such as streaming, where it added 30,000 new customers.

Shares in the company were down 6.8% at 0712 GMT.

Analysts at J.P. Morgan said Telia's quarterly performance was generally lower than consensus, hit by revenue and subscriber losses in key markets.

Telia still expects its adjusted core profit to grow by a low to mid single-digit percentage this year.

($1 = 10.8692 Swedish crowns)