Dividend policy is an integral part of our Capital Allocation strategy and will be the outcome of Telefonica’s free cash flow after investing in Telefónica’s future and ensuring the right financial leverage.
In the last years, Telefónica has combined different types of remuneration to the shareholders, such as dividend in cash, “scrip dividend”, or discretional share buyback and amortization of treasury stock.
In February 2025, the Company announced a cash dividend of 0.30 euros per share for 2025. The first tranche will be paid the 18th of December 2025 (0.15 euros) and the second will be paid in June 2026 (0.15 euros). For this payment, the adoption of the corresponding corporate resolutions will be proposed in due course.
The Annual General Shareholders’ Meeting of the Company, at its meeting held on April 10, 2025, agreed the distribution of a dividend in cash charged to unrestricted reserves, by means of a payment of a fixed gross amount of 0.30 euros during 2025 payable in two tranches:
- The first payment in cash of a gross amount of 0.15 euros per share has been paid on June 19, 2025.
- The second payment in cash of a gross amount of 0.15 euros per share will be on December 18, 2025.
In November 2025, the company announced a 2026 dividend per share in cash of 0.15 euros per share, to be paid in June 2027. For such purpose, the adoption of the corresponding corporate resolutions will be proposed in due course.
For the medium term, the target remuneration for 2027 and 2028 will be tied to a defined percentage of the FCF base for dividend [1] (payout of FCF). The 2027-28 percentage will be in the range of 40-60%. For these, the adoption of the corresponding corporate resolutions will be proposed in due course.
The decision to transition the remuneration policy in the medium term is part of Company’s capital allocation framework to ensure dividend payments remain sustainable and aligned with the willingness to invest in order to transform, grow, and deleverage as detailed in November 2025 in the Capital Markets Day.
[1] FCF base for dividend is the FCF base for guidance including employee commitments and dividends from VMO2.