Virgin Media o2 - comment

The company met its muted 2024 guidance but did show subscriber growth in the final quarter. We had expected top-line friction as higher prices caused customers to downsize their packages. We also expected EBITDA to be impacted by higher marketing costs (to provide discounts to customers to keep them with the company. Guidance for 2025 has network capex of £2bn - £2.2bn (up from £2bn) and adjusted free cash flow of £350m - £400m (vs nearly £500m in 2024). We expect the drop to be driven by increased investment in the network and higher marketing costs. We are updating our model and will publish on this name shortly.