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Associates and Joint Ventures
 12 Months Ended
Dec. 31, 2024
Interests In Other Entities [Abstract]  
Associates and Joint Ventures Associates and joint ventures
The detail of investments accounted for by the equity method and the share of (loss)/income of these investments is the following:
% HoldingInvestments accounted for by the equity methodShare of (loss) income of investments accounted for by the equity method
Millions of euros12/31/202412/31/2023202420232022
VMED O2 UK Limited50 %7,641 7,774 89 (2,030)292 
Movistar Prosegur Alarmas50 %213 230 (16)(22)(12)
FiBrasil Infraestructura e Fibra Ótica, S.A.50 %80 100 (1)(4)(8)
Unsere Grüne Glasfaser (UGG)50 %104 97 (77)(55)(64)
Opal Jvco Limited (nexfibre)25 %94 55 (2)(32)26 
Utiq, S.A.25 %3 5 (4)— — 
Others8 4 (3)(2)(4)
Joint ventures8,143 8,265 (14)(2,145)230 
Daytona Midco, S.L. (Nabiax)20 %— 65 (7)(1)(1)
Adquira España, S.A.44.44 %5 4 — — — 
HoldCo Infraco SpA. (Onnet Fibra Chile)40 %119 150 (24)7 — 
Alamo HoldCo S.L. (Onnet Fibra Colombia)40 %11 14 (17)(10)(15)
Internet para todos S.A.C54.67 %57 55 — — (3)
Telefónica Factoring España, S.A.50 %8 7 4 4 4 
Telefónica Factoring do Brasil, Ltda.50 %2 2 2 1 3 
Telefónica Factoring Peru, S.A.C.50 %3 3 1 1 1 
Telefónica Factoring Colombia, S.A.50 %1 1 1 1 1 
Telefónica Factoring México,S.A. de C.V.50 %— 1 — — — 
Telefónica Factoring Chile, SpA.50 %1 1 — — — 
Telefónica Factoring Ecuador, S.A.50 %— — — — — 
Telefónica Renting, S.A.50 %9 1 4 — — 
Telefónica Consumer Finance, Establecimiento Financiero de Crédito, S.A.50 %14 18 1 1 2 
Movistar Consumer Finance Colombia SAS50 %— — — (21)(3)
Others2 3 — — (2)
Associates232 325 (35)(17)(13)
Total8,375 8,590 (49)(2,162)217 
The detail of the movement in investments accounted for by the equity method in 2024 and 2023 is as follows:
Investments accounted for by the equity methodMillions of euros
Balance at 12/31/202211,587 
Additions236 
Translation differences and other comprehensive income (loss)144 
(Loss) income(2,162)
Dividends(1,218)
Transfers and others3 
Balance at 12/31/20238,590 
Additions160 
Translation differences and other comprehensive income (loss)249 
(Loss) income(49)
Dividends(520)
Transfers and others(55)
Balance at 12/31/20248,375 
Additions for the year ended December 31, 2024 includes the capital increase of 91 million euros in Unsere Grüne Glasfaser (UGG) (73 million euros for the year 2023) and the capital increase in nexfibre amounting to 38 million euros (33 million euros for the year 2023, see Note 28).
Additions in 2023 included (70,960 million Chilean pesos, equivalent to 73 million euros) corresponding to the capital contribution made by Telefónica Chile, S.A. in HoldCo Infraco SpA (of which it owns 40% of the capital) for the acquisition by InfraCo SpA (a subsidiary of HoldCo InfraCo SpA) of the fiber optic assets owned by Empresa Nacional de Telecomunicaciones S.A. ("Entel") following its authorization by the National Economic Prosecutor's Office on December 14, 2023.
"Translation differences and other comprehensive income (loss)" for the year 2024 mainly includes the impact of the pound sterling appreciation associated with the investment in VMO2, amounting to 380 million euros (219 million euros associated with sterling appreciation for the year 2023) and the results of the defined benefit pension plan in VMO2 amounting to 101 million euros (41 million euros for the year 2023). This also includes losses imputed to equity on derivatives financial instruments in Unsere Grüne Glasfaser amounting to 7 million euros (30 million euros gains for the year 2023).
During the year ended December 31, 2024, dividends amounting to 425 million pounds sterling, equivalent to 512 million euros, were received from VMO2 (1,000 million pounds sterling, equivalent to 1,154 million euros during the year 2023, see Note 28). Additionally included dividends amounting to 54 million euros from Nabiax.
On November 7, 2024, Nabiax's majority shareholder, Asterion Industrial Partners SGEIC, S.A. ("Asterion") (80% stake), reached an agreement with the Aermont Group to sell its shares in Nabiax. In compliance with the provisions of the original shareholders' agreement between Asterion and Telefónica Infra, S.L. (which owns the remaining 20%), Asterion has notified this transaction to Telefónica Infra, S.L. and has required it to adhere to the aforementioned sale agreement. In 2024 "Transfers and others" includes the reclassification of the stake in Nabiax to "Non-current assets held for sale" amounting to 58 million euros (see Note 29.c and 30).
VMED O2 UK
Impairment of goodwill recorded by VMO2 in 2023
As a result of the annual goodwill impairment test analysis carried out by VMO2's management at the end of 2023, VMO2 recorded an impairment of goodwill amounting to 3,107 million pounds sterling (approximately 3,572 million euros), mainly due to the decrease in projected cash flows of VMO2 as a consequence of the effects of macroeconomic conditions and the competitive environment in the United Kingdom and the increase in the discount rate (WACC).
50% of this amount (approximately 1,786 million euros) is reflected in Telefónica's consolidated income statement for the year 2023, as its share in the loss of VMO2 accounted for by the equity method (see table detailing the result from the equity method below).
The discount rate applied in the impairment test as of December 31, 2023 was 7.5% after taxes. The terminal growth rate considered was 1%.
Impairment analysis as of December 31, 2024
VMO2's management carried out the annual goodwill impairment test at the end of 2024. Future cash flows used in the value in use calculation were based on ten-year financial forecasts included as a part of the business plan approved by the VMO2 board of directors for use in impairment testing, considering that in such period the operating variables until the perpetuity parameters are reached. This time horizon was used for capital intensive projects such as the full fiber upgrade plan.
As a result of this analysis, it has become clear that, as of December 31, 2024, the value in use is above the carrying amount of the cash-generating unit (CGU) to which the goodwill is assigned, with a margin of around 800 million pounds sterling (around 965 million euros).
The growth projections and operating ratios included in the estimation of the value in use are aligned with the analyst ranges for comparable companies in the region. In terms of revenue, despite the challenges of the competitive environment, the strategic plan includes a growth trend in long-term projections, in line with the estimated evolution for the sector in the United Kingdom. In relation to operating results before depreciation and amortization margins two years ahead, analyst estimates for comparable companies in Europe are in a range of between 32% and 41%, while, regarding long-term investment needs, the capex to revenue ratio is in a range between 12% and 15%. The WACC discount rate applied to the cash flow projections stands at 7.7% at the end of December 2024. The perpetuity growth rate stands at 1%, below the actual terminal growth forecast for the UK economy. The analysis shows that the value in use is higher than the book value of the investment at December 31, 2024.
Regarding the sensitivity of the calculation to reasonably possible variations in key assumptions:
•An increase of about 50 basis points over the WACC rate used, of 7.7% would imply an impairment of goodwill reported by VMO2 of around 1,700 million pounds sterling (around 2,050 million euros).
•A decrease of around 25 basis points in the terminal growth rate (1%), would have no impact on the carrying amount of goodwill.
•Regarding the operating variables used, a decrease of 1 percentage point in the operating results before depreciation and amortization margin or an increase of 0.5 percentage points in the capex to revenue ratio would have no impact on the carrying amount of goodwill.
The carrying value of Telefónica's equity-accounted investment in VMO2 amounting to 7,641 million euros as of December 31, 2024 (7,774 million euros as of December 31, 2023). Telefónica has carried out an additional analysis of the book value of its stake at the end of the year, comparing it with its estimate of its value in use. The key assumptions considered in the calculation are the same as those used by VMO2 in determining its value in use. As a result of this analysis, no need to record any impairment has been identified.
Detail of the main items on the statements of financial position and income statements of VMED O2 UK Limited
Millions of euros12/31/202412/31/2023
Non current assets43,081 41,697 
Intangible assets7,682 8,379 
Goodwill21,404 20,427 
Property, plant and equipment10,994 10,011 
Other non current assets3,001 2,880 
Current assets5,166 4,758 
Inventories245 301 
Current receivables and other current assets2,900 2,882 
Other current financial assets660 567 
Cash and cash equivalents1,361 1,008 
Total Assets48,247 46,455 
Non current liabilities23,139 22,136 
Non current financial liabilities21,754 21,061 
Non current lease liabilities950 663 
Other non current liabilities435 412 
Current liabilities9,665 8,591 
Current financial liabilities4,970 4,165 
Current lease liabilities197 201 
Other current liabilities4,498 4,225 
Total Liabilities32,804 30,727 
Equity attributable to non-controlling interests (100% VMO2)
252 261 
Equity attributable to equity holders of the parent (100% VMO2)
15,191 15,467 
50% Telefónica Group
7,596 7,734 
Acquisition costs61 61 
Other adjustments(16)(21)
Investments accounted for by the equity method7,641 7,774 
Millions of euros202420232022
Revenues12,616 12,547 12,155 
Other operating income516 516 551 
Operating expenses(8,665)(8,632)(8,305)
Impairment losses in goodwill — (3,572)— 
Depreciation and amortization (1)
(3,371)(3,685)(4,170)
Operating income (loss)1,096 (2,826)231 
Share of income (loss) of investments accounted for by the equity method4 2 1 
Financial income51 55 24 
Financial expenses(1,578)(1,436)(1,020)
Realized and unrealized gains on derivative instruments, net (2)
463 (924)2,567 
Foreign currency transaction losses, net(34)677 (1,296)
Net financial result(1,098)(1,628)275 
Result before taxation2 (4,452)507 
Income tax(22)265 (15)
Result for the period (20)(4,187)492 
Attributable to non-controlling interests(19)— — 
Result for the period attributable to equity holders of the parent (100% VMO2)(39)(4,187)492 
50% attributable to Telefónica Group
(20)(2,094)246 
Share-based compensation (3)
1 8 14 
Sale of a minority interest in Cornerstone (4)
112 76 — 
Other adjustments(5)(20)32 
Share of (loss) income of investments accounted for by the equity method89 (2,030)292 
Other comprehensive income (100% VMO2)
(337)(213)(113)
(1) Includes amortization of the customer relationships recorded after the purchase price allocation, amounting to 1,012 million euros in 2024 (985 million euros in 2023).
(2) VMO2 entered into various derivative instruments to manage interest rate exposure and foreign currency exposure. Generally, VMO2 does not apply hedge accounting to its derivative instruments. Accordingly, changes in the fair values of most of its derivatives are recorded in the finance results of its consolidated income statement.
(3) Amount related to incentive awards held by certain employees of VMO2 associated with ordinary shares of Liberty Global and Telefónica. Share-based compensation expense is included in Operating expenses in the consolidated income statement of VMO2.
(4) In 2024 and 2023, VMO2 sold minority interests in its mobile towers joint operation Cornerstone. This amount reflects the change in the Telefónica Group's indirect ownership interest in Cornerstone (from 25% to 16.67% in 2023, then 16.67% to 12.50% in 2024) and resulting from the inflow of resources from a third party.

Commitments
Millions of euros20252026202720282029Subsequent yearsTotal
Purchase and other commitments791 189 109 61 5 — 1,155 
Programming commitments727 728 618 247 — — 2,320 
Network and connectivity commitments773 112 31 29 24 204 1,173 
Services agreements236 231 197 175 180 77 1,096 
Total commitments VMO2 (100%)
2,527 1,260 955 512 209 281 5,744 
Purchase and other commitments include unconditional and legally binding obligations related to the purchase of customer premises and other equipment and certain service-related commitments, including call center, information technology and maintenance services.
Programming commitments consist of obligations associated with programming contracts that are enforceable and legally binding that includes minimum fees.
Network and connectivity commitments include service commitments associated with the network extension program in the U.K. and commitments associated with the mobile virtual network operator (MVNO) agreements.
On the date of constitution of the joint venture, Telefónica and Liberty Global entered with VMO2 into certain service agreements included as "Services agreements", either on a transitional or ongoing basis. Likewise, Telefónica licensed the use of Telefónica and O2 brand rights to VMO2 (see Note 29.c).
The breakdown of balances and transactions related to associates and joint ventures recognized with VMO2 in the consolidated statement of financial position and consolidated income statement is as follows:
Millions of euros12/31/202412/31/2023
Receivables and other assets from associates and joint ventures59 66 
Payables and other liabilities to associates and joint ventures27 34 
Millions of euros 202420232022
Revenue from operations with associates and joint ventures135 134 130 
Expenses from operations with associates and joint ventures44 63 63 
Movistar Prosegur Alarmas
The breakdown of the key financial highlights of Movistar Prosegur Alarmas group and the reconciliation with the carrying amount in the Telefónica Group at December 31, 2024 and 2023 are as follows:
Millions of euros12/31/202412/31/2023
Fixed assets204 172 
Other non-current assets141 160 
Non-current assets345 332 
Cash and equivalents1 1 
Other current assets102 58 
Current assets103 59 
Total assets448 391 
Non-current financial liabilities(205)(175)
Other non-current liabilities(78)(63)
Non-current liabilities(283)(238)
Current financial liabilities(100)(102)
Other current liabilities(65)(43)
Current liabilities(165)(145)
 Total liabilities(448)(383)
Net assets— 8 
Purchase price allocation
Assets42 76 
Liabilities(11)(20)
Net assets31 56 
% Holding50 %50 %
Group’s share in equity15 32 
Goodwill198 198 
Carrying amount in the Telefónica Group213 230 
Group UGG TopCo GmbH & Co KG and UGG TopCo/HoldCo General Partner GmbH (UGG Group)
Unsere Grüne Glasfaser (UGG), is the joint venture of Telefónica (50%) and Allianz (50%), for the creation of an independent operator for the deployment of fiber-to-the-home (FTTH) in rural areas of Germany.
On December 4, 2024, UGG acquired Infrafibre Germany (IFG), which owns a fiber network in Germany and additionally two ISP brands, LEONET and Breitbandversorgung Deutschland (BBV). This transaction accelerates UGG's planned deployment plan, replacing part of its future capex and reinforcing its position as a provider of fiber optic infrastructure in rural areas of Germany. UGG and IFG operate in 8 federal states ("Länder"). The operation has been 100% financed through the bank loan from UGG.
The summary of the magnitudes of the UGG Group and the reconciliation with its carrying amount in the Telefónica Group at December 31, 2024 and 2023 are shown below:
Millions of euros12/31/202412/31/2023
Fixed assets1,344 438 
Other non-current assets194 211 
Non-current assets1,538 649 
Cash and equivalents282 49 
Other current assets63 50 
Current assets345 99 
Total assets1,883 748 
Non-current financial liabilities(1,493)(522)
Other non-current liabilities(43)(36)
Non-current liabilities(1,536)(558)
Current financial liabilities(4)(5)
Other current liabilities(232)(88)
Current liabilities(236)(93)
 Total liabilities(1,772)(651)
 Net assets111 97 
% Holding50 %50 %
Group’s share in equity55 49 
Other adjustments49 49 
Carrying amount in the Telefónica Group104 97 
Commitments
The breakdown of purchase and other contractual commitments of the UGG Group at December 31, 2024 is as follows:
Millions of euros12/31/2024
Less than 1 year431 
1 to 3 years305 
3 to 5 years275 
More than five years414 
Total commitments UGG group (100%)1,425 
Opal Jvco Limited (nexfibre)
Opal Jvco Limited (nexfibre), the joint venture in which Liberty Global and Telefónica have a joint 50% stake and Infravía has the remaining 50%, aims to deploy fiber-to-the-home (FTTH) in the UK. During 2024, nexfibre has continued its fiber deployment.
The summary of the magnitudes of Opal Jvco Limited and the reconciliation with its carrying amount in the Telefónica Group at December 31, 2024 and 2023 are shown below:
Millions of euros12/31/202412/31/2023
Fixed assets1,833 840 
Other non-current assets185 98 
Non-current assets2,018 938 
Cash and equivalents37 23 
Other current assets62 54 
Current assets99 77 
Total assets2,117 1,015 
Non-current financial liabilities(1,453)(593)
Other non-current liabilities(3)— 
Non-current liabilities(1,456)(593)
Current financial liabilities(100)(61)
Other current liabilities(199)(157)
Current liabilities(299)(218)
Total liabilities(1,755)(811)
Net assets362 204 
% Holding25 %25 %
Group’s share in equity90 51 
Other adjustments4 4 
Carrying amount in the Telefónica Group94 55 
Commitments
The breakdown of purchase and other contractual commitments of the Opal Jvco. Group at December 31 2024 is as follows:
Millions of euros12/31/2024
Less than 1 year678 
1 to 3 years122 
3 to 5 years67 
More than five years4 
Total commitments Opal Jvco. group (100%)871 
Most of Opal Jvco. group's commitments are with VMO2.
HoldCo Infraco SpA. (Onnet Fibra Chile)
Holdco Infraco SpA, an associated company of the Telefónica Group through its subsidiary Telefónica Chile. S.A. (40%), provides telecommunications services to wholesalers of fiber optic access to the home (FTTH) and other services based on fiber optic infrastructure, such as network construction, installation and equipment of systems through its subsidiary Infraco SpA.
The summary of the magnitudes of Holdco Infraco Group and the reconciliation with its carrying amount in the Telefónica Group at December 31, 2024 and 2023 are shown below:
Millions of euros12/31/202412/31/2023
Non-current assets1,343 857 
Cash and equivalents11 27 
Other current assets84 182 
Current assets95 209 
Total assets1,438 1,066 
Non-current financial liabilities(892)(521)
Other non-current liabilities(304)(293)
Non-current liabilities(1,196)(814)
Current financial liabilities(34)(3)
Other current liabilities(102)(78)
Current liabilities(136)(81)
Total liabilities(1,332)(895)
Net assets106 171 
Purchase price allocation
Assets159 178 
Liabilities(43)(48)
Net assets116 130 
% Holding40 %40 %
Group’s share in equity89 120 
Other adjustments30 30 
Carrying amount in the Telefónica Group119 150 

Breakdown of balances and transactions with associates and joint ventures
The breakdown of items related to associates and joint ventures recognized in the consolidated statements of financial position and consolidated income statements is as follows:
12/31/202412/31/2023
Millions of eurosAssociatesJoint venturesTotalAssociatesJoint venturesTotal
Credits and other financial assets
244 2 246 263 2 265 
Receivables and other assets (Note 14)87 112 199 91 93 184 
Financial liabilities— 10 10 — — — 
Non-current lease liabilities 60 9 69 37 — 37 
Non-current payables and other liabilities (Note 21)433 1 434 236 4 240 
Long-term contractual liabilities 31 52 83 44 54 98 
Current lease liabilities55 4 59 42 — 42 
Current payables and other liabilities (Note 22)377 50 427 183 44 227 
Short-term contractual liabilities 14 6 20 15 6 21 
202420232022
Millions of eurosAssociatesJoint venturesTotalAssociatesJoint venturesTotalAssociatesJoint venturesTotal
Revenue from operations 520 251 771 473 223 696 209 251 460 
Expenses from operations 677 136 813 634 136 770 199 116 315 
Financial revenues 26 2 28 29 1 30 27 1 28 
Financial expenses 45 1 46 9 7 16 1 9 10 
"Credits and other financial assets" at December 31, 2024 includes loans granted and long-term trade receivables amounting to 112 million euros and 14 million euros, respectively by Colombia Telecomunicaciones, S.A. ESP BIC to the associate company Álamo Holdco, S.L. and it subsidiary Onnet Fibra Colombia S.A.S., (112 million euros and 29 million euros as of December 31, 2023, respectively). Additionally, this line includes at December 31, 2024 long-term loans from Telefónica Chile to the associate company HoldCo Infraco, SpA amounting to 118 million euros (121 million euros as of December 31, 2023) of which 75 million euros corresponds to the subordinated debt generated by the sale of 40% of the fiber optic business (75 million euros as of December 31, 2023) and 43 million euros corresponding to the indefinite-term loan for the acquisition of the fiber optic assets owned by Entel (46 million euros as of December 31, 2023, see Note 12).
"Non-current payables and other liabilities" and "Current payable and other liabilities" at December 31, 2024 includes 433 million euros and 217 million euros, respectively, of Telefónica España with the associate company Telefónica Renting, S.A. (235 million euros and 85 million euros, respectively, at December 31, 2023). Telefónica Renting is a company of the CaixaBank group (see Note 11). "Revenue from operations" and "Expenses from operation" in 2024 includes 373 million euros and 455 million euros, respectively, of Telefónica España with this company (243 million euros and 392 million euros for the year 2023).
Additionally "Revenues from operations" includes 28 million euros corresponding to the transactions of the Group with the associate company HoldCo Infraco SpA (63 million euros and 88 million euros in 2023 and 2022, respectively) and 98 million euros with the associate company Onnet Fibra Colombia, S.A.S. (140 million euros in 2023).
"Expenses from operations" in 2024 includes 103 million euros corresponding to the transactions of the Group with the associate company HoldCo Infraco SpA (144 million euros and 121 million euros in 2023 and 2022, respectively) and 81 million euros with the associate company Onnet Fibra Colombia, S.A.S. (60 million euros in 2023).