Telefonica AGM OKs All Board Proposals, Confirms €0.15 Dividend and Turnaround Strategy

• The shareholders approved all the board’s proposals at the AGM, including the accounts for 2025, the appointment of an auditor and a director, the allocation of EUR 1,060m in voluntary funds, and paid a dividend of €0.15 per share payable on June 18, 2026.

• The chairman mentioned i “Change and Grow” the strategy of simplifying the group, focusing on the four main markets (Spain, UK, Germany, Brazil), exiting the non-main markets of Latin America, and pursuing high-level European integration with the aim of becoming the leading “tech-telco” in 2030 and the top telco in the world in 2035.

• Telefonica said it met its financial obligations for 2025 with an EBIT adjustment of up to 2%, free cash flow from continuing operations of 2,069 million euros, B2B revenue growth of 7.1%, and cited strategic measures such as the acquisition of Netomnia and the acquisition of FiBrasil fiber to strengthen network capabilities.

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Telefonica (NYSE:TEF) called its general meeting of shareholders on the second call with a quorum representing more than 65% of the company’s shares, according to figures read into the record by the secretary of the meeting and later updated after the closing of the list of speakers.

The provisional attendance figures stated at the beginning of the meeting showed 27,390 shareholders who attended in person or by proxy, holding 3,720,786,545 shares and representing 65.62% of the company’s share capital. The chairman announced the quorum of the meeting at the second call, and the representative asked if any of those present had doubts or protests about the statements of attendance; no one was reported at that time.

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Later, the final attendance data presented after closing the list of speakers showed 27,661 shareholders were present or represented, holding 3,726,013,000 shares, representing 65.71% of the company’s capital.

The Secretary also reviewed the shareholder intervention and voting process, including remote participation procedures and instructions related to proxy voting where directors may face a conflict of interest. Shareholders attending in person are instructed to register votes against or absent at designated desks; otherwise, votes will be taken in favor of the proposed decisions.

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The secretary informed the shareholders about the company’s annual report on business management for the financial year 2025, filed with Spain’s securities regulator (CNMV) on Feb. 24, 2026, and made available on the company’s website. The secretary said Telefonica complies with “almost all” the recommendations of Spain’s good governance code, while highlighting areas of partial compliance, including:

• A 10% limit on the maximum number of votes a single shareholder can cast under Article 26 of the city’s bylaws, which is defined as a device to protect minority shareholders.

• The existence of a single joint Nomination, Remuneration, and Corporate Governance Committee, despite current plans to separate it.

• Disclosure procedures regarding executive contracts, including whether the terms of termination of an employee remain from the previous contract.

The annual report on directors’ remuneration for the financial year 2025 was described as approved by the board on Feb. 23, 2026 and was filed the next day in the CNMV.

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The meeting reviewed the main proposed decisions brought by the board, including the approval of the 2025 accounts and reports, sustainability information, distribution of profits, appointment of auditor, appointment of the board, payment of shareholders, and advisory and procedures. Important items included:

• Approval of Telefonica’s annual and consolidated accounts and management reports for the financial year 2025, as prepared by the board at its meeting of 23 February 2026.

• Approval of consolidated non-financial group information and sustainability for fiscal year 2025, with the secretary noting that PricewaterhouseCoopers (PwC) audited the financial information and verified the non-financial information.

• Distribution of Telefonica, SA profit of EUR 1,060 million voluntary reserves.

• The re-election of PricewaterhouseCoopers Auditores, SL as statutory auditor for the financial year 2026 and the appointment of the same firm for the financial years 2027-2029, following a public tender process.

• The director proposals include the re-election of María Luisa García Blanco and the confirmation/appointment of Anna Martínez-Balañá, César Mascaró y Alonso, and Mónica Rey Amado, and the appointment of Jane Thompson, all described as independent directors.

• A proposed dividend of EUR 0.15 per share is charged on free reserves, with payment scheduled for June 18, 2026.

• Approval of directors’ remuneration policy to apply from approval for fiscal years 2027-2029.

• Advisory (consultative) vote for the 2025 annual report on directors’ salaries.

In the words of the shareholders, the chairman said that the company started about 15 months ago a “deep transformation” aimed at simplifying the organization, focusing on the main markets, strengthening the balance sheet, and reducing exposure to Latin America. He described Telefonica’s strategic ambition as being the “best access point” for citizens, companies, and institutions to digital technologies, with the goal of being among the leading “tech-telcos” in Europe by 2030 and among the leading telcos in the world by 2035.

The chairman said Telefonica is focused on four main markets—Spain, the United Kingdom, Germany and Brazil—and said the company has completed exits from Peru, Uruguay, Ecuador, Colombia and Chile. He also cited the acquisition of Netomnia in the UK as being in line with the company’s approach to integration and network capabilities.

Discussing the operation, he mentioned plans that include an AI-powered cloud with low latency processing and “17 edge nodes,” automatic network hardening, and the Titan Connect solution for secure and robust communication in critical areas. He also referred to the success of the Movistar Plus+ content and cited several products by name.

Regarding financial performance, he said Telefonica met its financial obligations for 2025, with increased revenue and improved profitability. Among the figures he cited were adjusted EBIT growth of 2% (adjusted for exchange rates), free cash flow from continuing operations of EUR 2,069 million, and net income of 326 million, which was described as an increase of 2% year-on-year. He also pointed to B2B growth of 7.1% and said IT revenue will represent more than 48% of B2B revenue by 2025. He pointed to operations in Spain, Germany, and Brazil, including Vivo’s revenue growth of 11.2% in 2025 and mobile access of 103 million, and said that the company has acquired 100% Brazilian fiber.

During the Q&A, the shareholder asked about the reason for the dividend reduction and sought management’s opinion on the performance of the share price. The chairman replied that the budget policy is part of the allocation of capital, taking into account the generation of income and the financial flexibility required for the new phase of the company. He reiterated the commitment to a EUR 0.15 dividend per share by 2026 and said that, in the medium term, value creation will be driven by growth, liquidity, and cash generation. On the share price, he said it will reflect the company’s ability to generate income, EBIT, “EBITDA quality,” and turn EBITDA into cash flow, adding that investor confidence will be reflected in the share price as results improve.

Another shareholder asked about European telecom integration. The chairman said that Telefonica considers Europe to be different with “38 large employers” compared to the three in the United States, China, and India, saying that a measure is needed to invest, develop technology and compete. He said Telefonica intends to “lead or lead” the merger, starting within individual markets before moving to the European level, while adding that he could not discuss specific negotiations or possible moves.

In the answers led by CEO Emilio Gayo, the management answered questions about the layoff plan, describing it as enabling the company to bring in special talent, improve employment by redesigning skills, and develop new work models. He said the outcome at Telefonica España had been positive, emphasizing the negotiation process supported by the unions and noting that most exits were voluntary.

Gayo also responded to concerns about cable and infrastructure in Spain, saying the company is renewing 50,000 jobs a year and plans to increase that to 100,000, and that 60% of the copper has been cut and is expected to be completed in the next 12 months. He said the European funds received were used for “dual use,” including rural 5G connectivity and fiber development as well as the digitization of customers and public administration. He also answered questions about pensions, noting that allegations were made at Social Security and that channels exist for former employees to send questions.

At the end of the meeting, the secretary reported that there is a sufficient majority to approve all the decisions proposed by the board in the program, and the final voting data will be published on the company’s website.

Telefónica, SA is a Spanish multinational telecommunications company headquartered in Madrid. Founded in 1924 as Compañía Telefónica Nacional de España, it has grown to become one of the largest telecommunications groups in the world. Telefónica offers a wide range of communications services to residential and business customers, including mobile and fixed-line telephony, broadband Internet, and pay TV. The company also develops and sells network infrastructure and related services to support communications at scale.

Beyond traditional voice and data services, Telefónica has expanded into digital and IT services aimed at business and public sector customers.

The article “Telefonica AGM OKs All Board Proposals, Confirms €0.15 Dividend and Transformation Strategy” was first published by MarketBeat.