More than just calling us: Swisscom

More than just calling us: Swisscom

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We have recently welcomed Swisscom to the Obermatt Swiss Pearls Index as a new constituent - a decision driven by a comprehensive evaluation of the company's strengths and potential through the Obermatt 360° View. Swisscom's inclusion reflects our commitment to selecting high-quality companies with robust fundamentals and the potential for sustained long-term growth for the index.

At the same time, Sonova was removed from the portfolio. This decision was made based on Sonova's currently low 360° View.

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Beyond its strong Obermatt 360° View score, Swisscom possesses several other compelling attributes. Its dominant market position in Switzerland provides a solid foundation for consistent revenue generation and profitability. Furthermore, Swisscom's commitment to shareholder returns through consistent dividend payouts aligns perfectly with OMSP1's focus on generating sustainable income for investors.

In the third quarter of 2024, the company reported solid financial results, reinforcing its position as a financially sound and resilient player in the telecommunications sector. This continued success underscores Swisscom's ability to navigate the dynamic market landscape while maintaining operational excellence. Furthermore, Swisscom remains committed to expanding its network infrastructure. The company continues to invest heavily in the expansion of its fiber-optic network, providing customers with access to high-speed internet services and enhancing its competitive advantage. This ongoing network expansion is crucial for meeting the growing demand for high-bandwidth connectivity and positioning Swisscom for future growth in the digital economy. At the same time, Swisscom is launching its new AI-capable data farms, with offerings aimed at their business users.

The ongoing acquisition of Vodafone Italia remains a key strategic focus for Swisscom. While the integration process presents inherent challenges, the company is actively working towards a successful integration to expand its market reach and capitalize on new growth opportunities in the Italian market.

While Swisscom boasts numerous strengths, it also faces several challenges. The telecommunications industry is fiercely competitive, with established players and new entrants vying for market share through aggressive pricing strategies and innovative service offerings. This intense competition can exert pressure on pricing and profitability margins. Furthermore, the rapid pace of technological advancement necessitates continuous investment in areas like 5G and fiber optics, which can significantly impact short-term profitability. Additionally, the ever-evolving regulatory landscape, including data privacy regulations and antitrust concerns, can pose significant challenges to the company's operations.

The inclusion of Swisscom in the OMSP1 portfolio marks an exciting milestone, as it represents the first telecommunications company to be included in the index. This diversification enhances the index's exposure to a vital sector of the Swiss economy and brings the OMSP1 portfolio closer to mirroring the actual industry distribution within the Swiss economy.