Good morning, ladies and gentlemen, and also a warm welcome from our side to Swisscom's Q2 2026 Results Presentation. My name is Louis Schmid, Head of Investor Relations.

And with me are our CEO, Christoph Aeschlimann; and Eugen Stermetz, our Chief Financial Officer. Let's now move to Page #2 with the agenda of today.

As you can see, our CEO starts the presentation with Chapter 1 achievements, a quick overview on the Q2 highlights, the operational and financial performances of the second quarter. Then in Chapter 2, Christoph presents the business update for Switzerland and Italy.

In the second part of today's presentation, our CFO, Eugen runs you through Chapter 3 with our Q2 financials, including the confirmation of our full year guidance. With that, I would like to hand over to Christoph to start his presentation.

Christoph?

Thank you, Louis. Welcome to the Q2 call also from my side.

I'll start directly on Page #4 with the quarter highlights. You have seen from the numbers that we delivered a solid performance, and we are operationally and financially on track.

I'm very pleased with the first half year results. Based on these results, we have also confirmed the full year guidance.

In Switzerland, we were able to again win the mobile connect hotline test, and we managed to secure the Champions League rights until 2030, which further strengthens our entertainment offering in Switzerland. We also announced a couple of management changes in Switzerland.

We decided to put in place a dedicated Swiss CEO and CFO. All positions have been nominated by internal successors, ensuring continuity and allowing more focus on the Swiss market and the ongoing AI-based transformation in Switzerland.

We also nominated a successor of the B2C business with Michel Siegenthaler, who is a long-standing member of the B2C management team. And also on that side, we have ensured continuity and full focus on executing our current strategy.

As a group CEO, I will continue to provide strategic leadership across Switzerland and Italy, and Eugen will hold overall financial responsibility for the group as Group CFO. Our strategy remains exactly the same and is unchanged, both for Switzerland and for the whole group of Swisscom.

Now moving to Italy. We are fully on track on the integration, integrating Vodafone Italia into Fastweb and synergy realization is going on faster as planned, and we are ahead of budget and plan on the integration side.

We're also leading with innovation in Italy. We launched numerous products, one which is noteworthy is ROSS, our AI app for consumers, and we also enhanced the energy portfolio, and I will talk a bit more about energy later on during the call.

Now moving on to Slide #5. You can see the Q2 financials have a consistent operating free cash flow increase, reaffirming our full year guidance.

Revenue is still slightly down by 2%, posting CHF 3.6 billion in revenue, driven by lower service revenue, both in Italy and Switzerland and lower hardware in Italy. Eugen will give a bit more color on the revenue development later on in the presentation.

EBITDAaL is up 6.1% to CHF 1.269 billion, driven by synergies in Italy and strong cost savings in Switzerland. We had seasonally lower CapEx, down minus 6.3%, leading to a high growth on operating free cash flow with CHF 608 million, which is up 23.9% compared to previous year-on-year comparison.

On the right-hand side, you can see the operating free cash flow bridge, which I will not comment as Eugen will go into detail through these numbers later on in the finance section. But overall, I think we can say that we are very pleased with the Q2 and H1 results, posted a solid and good performance in the first 6 months of 2026.

I will now provide an update on our business in Switzerland and Italy. As you know, we have clear priorities to grow the free cash flow by ensuring stable free cash flows from Switzerland.

So I'm now on Page #7. Ensuring the free cash flows or stable free cash flow, sorry, in Switzerland, we do this by managing 3 things.

First, managing the Telco top line. We are working on boosting efficiency and delivering cost savings and achieving profitable IT growth in B2B space.

Second, we are ensuring growing free cash flows from Italy. This is achieved by 3 actions: driving the integration and delivering the synergies, delivering the Telco turnaround, specifically on the B2C side and also growing IT business, but also the energy business in Italy.

I will now go into a bit more details how we are doing according to these 3 objectives, both in Switzerland and in Italy. Now diving into Switzerland, we start with B2C on Page #8.

You can see that we are operationally on track, and we have successfully implemented the price increase. As you can see on the right-hand side, this has led to a temporary increase in churn numbers in Q1.

This churn is now coming down again to, let's say, the seasonally normal churn figures. You can see that in Q2, churn has come down substantially.

It is still slightly elevated to the historical churn levels, but we are confident that churn will now normalize over the coming quarters in 2026. We still had some negative impact on the RGU side, especially on broadband, while the mobile side is working quite nicely with plus 10,000 RGUs in Q2.

Broadband was also better than Q1, but still slightly negative with minus 8,000. This will be one of our main priorities going forward, working on making sure that also on the broadband side, we can achieve stability on the RGU side.

This will require additional measures on the Wingo side as we want to strengthen Wingo also as a broadband provider. This is one of the reasons why we launched the Wingo brand refresh to position Wingo more strongly in the market.

We also executed a price increase on the Wingo side with a more-for-more approach with plus CHF 1 from September 1 going on. We did the same on the Migros Mobile side on our third brand.

You can see that we are working on various levers to improve the service revenue evolution and make sure that we deliver the most value out of the B2C business. Another important pillar next to service revenue is working on all the value-added services.

We are very pleased that we were able to confirm or continue to work together with UEFA Champions League until the end of the decade, which strengthens our blue TV proposition. But also, we see very good momentum on the security side with strong net adds and also the AI proposition for consumers is developing a very positive traction overall.

We will continue to invest both on the AI and security side as this is important to positively impact ARPU over time and counteract the brand switches and deliver new revenues overall for our B2C business. Maybe one last comment before we move on, on the ARPU side, you can see that ARPU is slightly up, impacted positively on the one side by the price increase of own brands and then some negative effects due to continued brand switching from own brands to Wingo.

But overall, you can see that for this quarter, we had a positive impact roughly driving up ARPU CHF 1, both on mobile and on wireline. Now I'm moving on to B2B, where we -- starting with the Telco business.

The operational trends are roughly in line with what we've seen in previous quarters. So losing RGUs, both on mobile and on broadband, while ARPU is also slightly up also due to selected pricing measures that we took in the past quarters.

It's sort of stable, slightly improving on the ARPU side, but still negative on the net add side. One of our main focus in B2B is also working on the RGU side, making sure that we stop the continued loss of connections.

We do this by working on several aspects. First, we do a lot of actions on the customer value management, increasing retention and value realization, especially on the SME side.

We are executing numbers -- numerous activities. We are scaling up further the sales of beem.

Basically delivering more value and different products to our customers on the security side to make sure that our offers are more sticky, combining security with connectivity. We are also working on strengthening our partner strategy, especially in the mid-market to further scale beem and the IT platform reselling.

Maybe one note on beem. We see quite positive numbers on the growth side of beem.

The mobile business is delivering very well. We already have over 100,000 users.

On the broadband side, pickup is also -- is picking up, slightly lower numbers with 1,200 locations being secured. We will continue to focus on the beem scale-up in the ongoing quarters this year and especially also next year as we believe that secure -- delivering secure connectivity will be one of the key topics going forward in the B2B space.

On the IT side, there is a bit light and shadow. On the one side, we have a softer revenue top line, mainly driven by lower volumes for workplace and UCC, which we were not able to compensate with the higher demand that we see for sovereign cloud and AI.

Overall, slightly lower revenues. We expect this to continue for the full year.

Probably IT service revenue will come in slightly lower on a full year basis than last year as also the market is quite demanding at the moment. We decided to focus on the profitability improvement and making sure that we can deliver more EBITDAaL despite softer revenues.

You can see that already in Q1 and Q2, we were able to deliver an increased profitability with strict cost discipline and better project execution, and we expect this to continue also on a full year basis, bringing up profitability of the IT business to a much better and more profitable level. At the same time, we are also working on new growth avenues for B2B.

We are further investing into Swiss AI Assistant as we see increased demand on the AI front, especially in the SME, but also the corporate side. We are working on many opportunities in the defense sector, where we have a lot of multiyear contracts in place now, which should allow us to deliver new growth going on -- coming in the coming years.

Now moving on to Network and Wholesale on Page #10. You can see that we continue to invest in our network.

5G plus coverage is up 2.5%, now covering 90% of Switzerland and FTTH coverage is up 4%, now covering 58% of Switzerland with FTTH connection. We're also making good progress on migrating our mobile customers to the new 5G stand-alone core with over 1 million customers now on the new core infrastructure, which is important for our tech renovation and moving to a fully cloud-enabled technology basis.

On the spectrum side, we expect the final communication by the regulator until the year-end in the coming months. We expect the auction to happen somewhere in summer, autumn 2027.

Still roughly 1 year to go until the auction will finally happen or should happen. We will know the exact timing once the regulatory communication has happened.

Hopefully, we can update you more on this topic in the Q3 call early November. Positively is, I think, positive news we have on the wholesale front.

You can see that we have consistent RGU growth on the broadband side, again, plus 14,000 net adds, exactly the same as in Q1. We have substantially better and higher run rate now than in 2025 when you compare this on a yearly basis.

We expect this to continue for the full year. This is continuously delivering service revenue growth on the wireline side, you can see that we deliver CHF 5 million more or plus 10% service revenue growth.

We expect this to continue in the next quarters as we continue to gain market share and drive up penetration in the FTTH footprint that we are building out. Now on Page #11 is the last slide on Switzerland.

Some words on our cost savings. You have seen in the results, we have delivered CHF 42 million of cost savings.

A lot of the savings this year are front loaded, and we also have some seasonality in Telco savings. We are fully confident that we will deliver more than CHF 50 million of cost savings.

But please do not extrapolate the Q2 number to the full year. We will not deliver CHF 84 million of cost savings this year.

I mean it would be very nice. But our guidance is to stick to the at least CHF 50 million for the full year.

We also announced the opening of a new near-shoring center. As you know, we have near-shoring centers in Riga and Rotterdam, and we are opening a new center in Lisbon next year to better balance the workflow between these areas and also make sure that we have more options in the light of the geopolitical developments makes -- gives us more flexibility with a new lower cost center in Portugal versus the situation we have today.

I will now move on to Page #12 in Italy. The integration of Vodafone Italia is proceeding very positively and according to plan, actually slightly ahead of plan.

You see that we have delivered EUR 89 million savings in Q2, bringing synergy realization to EUR 166 million for the first half. We are fully on track to deliver the EUR 300 million on a full year basis.

The integration or synergy realization is driven this year very much by the transitioning of the Vodafone Group services, which we are in-sourcing back into Italy, and this is going as planned. At the same time, I think we can say that the integration costs are under control, even slightly lower than we expected them in the first half of the year, but we will significantly ramp up integration costs in the second half year as we have some larger IT and network investments coming up in the second half of the year.

Now on Page #13, you can see B2C. We are continuing to execute our value focus on the Telco side and delivering growth in the energy business.

Now the back to front book alignment has been successfully completed on the mobile side and is still ongoing in broadband. You can see the different effects this has on churn, RGU and ARPU.

On the wireline side, the net adds are improving versus Q1. We are 66,000 better, still negatively impacted by the value strategy, but much better in Q2 over Q1 as the repricing effects are phasing out.

Also, churn is coming down. You see that we are now standing at 16% churn, which is materially better than where we were 1 year ago.

For the first time since the merger, we also have a slightly increasing ARPU on the mobile with ARPU now standing at EUR 8.3 overall. The broadband side, Q2 is still affected by the ongoing value focus and the back to front book price alignment that we are currently executing.

Churn is only slightly up. This is, I would say, the good news, roughly stable churn.

But on the inflow or sales side, I think the continued value focus makes it harder to generate more gross adds. Overall, we see a slightly softer net adds, but also slightly increased ARPU versus Q1.

Now we are sharpening also our brand positioning. While we are clearly positioning Fastweb and Vodafone as a premium brand, we position home mobile much more clearer as an attacker brand so that we can serve the market with our dual strategy branding on the one side, the premium approach under the Fastweb and Vodafone umbrella and a more smart shopper approach, attacker approach on the home mobile side.

Last but not least, we are continuing to invest in our energy business. We have successfully launched a new enhanced converged proposition, which is delivering very encouraging results.

We now have 141,000 RGUs, and this will deliver slightly over CHF 100 million in top line in 2026. So a very nice growth compared to the previous year.

Now moving on to B2B on Slide #14. We continue to maximize value in Telco and drive IT and energy growth.

You can see that the RGU developments are slightly negative, both in wireline and in wireless. But wireless is impacted by the fading out of the TM9 framework agreements, but the RGU base is growing on a year-by-year comparison by plus 75,000 net adds.

Broadband net adds are broadly in line with previous quarters, but are affected by lower gross additions due to challenging market environment, especially in the SME space, where the market is quite challenging at the moment. But we are working on further portfolio optimization, working on new portfolio elements so that we can make our portfolio more attractive and hopefully improve these trends in the coming quarters.

Now we are -- I think on the IT front, we have good news. We are scaling up our proprietary AI solutions and cloud services, where we see very good demand to strengthen our sovereign cloud offering for enterprises and public administration.

Also, the energy business is scaling up, double-digit top line growth expected also on the B2B side, driven by both RGU and ARPU improvements, thanks to the convergent offers and the strong sales performance. On the Network and Wholesale side, on Page #15, you can see that also in Italy, we are continuously expanding and investing in our network.

5G plus coverage is up 3%, standing exactly at 90%, the same as in Switzerland. We have again been awarded numerous network awards being the best network in Italy.

Also, FTTH rollout is advancing steadily. It's up 8%, bringing us to 61% FTTH coverage in Italy with a balanced 50-50 passive active fiber sharing that we are using from Open Fiber and fiber.

You've maybe seen also that we have launched a pilot with Starlink to test how we could improve mobile coverage in rural areas. This is a technical pilot.

It's delivering encouraging results, but still a lot of work required and also regulatory approvals required to be able to launch this as a full commercial offering. Now some words on the development of the wholesale side.

You can see that as we announced previously, the PosteMobile migration is now completed, and you can see the full RGU effect of roughly EUR 2.6 million gross in the Q2 figures. Some of it is partially offset by the performance of CoopVoce and other MVNOs, but still we have a net reduction of RGUs by minus 2.3 million.

This net reduction will continue in the second half of the year as TIM announced the winning of the Lyca MVNO and the migration is now fully ongoing. This represents another roughly 1 million of RGUs that will be migrated away from our network over the next half years.

This will, of course, generate some losses on the -- like wholesale MVNO revenues, but it also alleviates quite a lot of traffic on our network, and we can counterbalance some of these effects by delaying some network or not required capacity investments on the mobile network side due to less SIMs on the network. On the other side, broadband is developing very positively.

You see plus 49,000 net adds, plus 22% on a year-on-year basis, driven by solid demand and expanded partners in this space, and we are continuously working on acquiring new partners to continue to drive our broadband on the -- broadband wholesale business, sorry. Okay.

Final slide from my part from me on Page #16. One word around AI and strategic infrastructure initiatives.

We are continuously bolstering our AI footprint in Italy. We have launched a new Fastweb AI suite and managed -- which is basically a managed inference solution and we're able to win over 10 projects since the launch early this year.

We will continuously invest into this offering as we believe that AI inferencing will be a major growth drivers in the years to come. We also launched the ROSS proposition for consumers, which is basically an AI agentic app for consumers, and we will see how this delivers in the coming quarters and years.

I think more importantly on this slide are the strategic infrastructure initiatives, which are progressing very well. You have seen that the Court of Milan has rejected INWIT interim measures and basically confirmed that our termination is fully lawful and in line, and we can proceed.

Our preparations are fully on track for the migration starting on 1st of April 2028 to maximize flexibility. We will provide you with more detailed update probably in the Q3 results, how we intend to migrate off the INWIT grid.

We are also progressing on the Tower JV with Telecom Italia, which is the initiative to deploy roughly 6,000 sites. We are currently working on the long-form agreement, which we expect to be completed by year-end.

We are also working on the RAN sharing agreement with Telecom Italia to accelerate 5G deployment or 5G coverage in low-density area. This is currently in the regulatory process where we are making progress.

The antitrust review is ongoing, and we expect this to be completed also next year, and we will update you as soon as we have more news on this topic. Overall, very pleasing progress on the infrastructure side, which is important for us to make sure that we can on the one side, accelerate investments in network, make sure that the networks become better in Italy at the same time, reduce our cost base in the years to come.

I will now hand over to Eugen for the financial results.

Thank you, Christoph, and good morning, everybody, from my side. Let's dive directly into the group numbers on Page 18.

Revenue was down CHF 225 million year-over-year. Net of currency, that's CHF 147 million.

In Switzerland, revenue was down just CHF 27 million, most of which was in the first quarter. The overall equation is Telco service revenue down, also IT service revenue slightly down, but higher hardware and software revenues in B2B in particular in the second quarter.

Also the service revenue decline was lower in the second quarter. This is why Q2 is better than Q1.

Italy, down CHF 111 million basic equation here, Telco service revenue down, also hardware and software down, but energy up. Q2 also here was much better than Q1.

The year-over-year development was driven by lower Telco service revenue decline in the second quarter, among other factors. On the EBITDAaL side in the group, we are up CHF 83 million, adjusted CHF 92 million.

Switzerland is slightly up, plus CHF 10 million. We had strong cost savings in the first half of the year with a bit of phasing.

Christoph already did my job here of managing expectations for the full year. I'm not going to add much on that topic.

There was another factor in play in the second quarter, which was a better IT result despite lower revenues. Also here, Christoph already commented very much to the point.

Italy, EBITDAaL was up CHF 92 million, obviously driven by synergy, but also here some in-year phasing in indirect costs helped. All in all, we are clearly on track to meet the EBITDAaL guidance for the full year.

Page 19. CapEx was down CHF 131 million in the group.

In Switzerland, down CHF 70 million. The main reason here is different phasing of FTTH between the years.

In the first half of 2025, we had very high FTTH volumes. There will be some CapEx catch-up to be expected in the second half of the year.

For the full year, we confirm the guidance of CapEx slightly down in Switzerland. In Italy, CapEx was down CHF 67 million.

That's CapEx adjusted. Integration CapEx was actually up.

You don't see it here on this chart. We'll see it on the Italian pages.

For the full year, we confirm the guidance of reported CapEx in Italy roughly stable with adjusted CapEx down, which you already see here on this chart in the first half of the year and the integration CapEx up in the full year. Then operating free cash flow, up CHF 214 million, obviously driven by higher EBITDAaL and lower CapEx, both in Switzerland and in Italy.

Also here for the full year, we are fully on track to deliver as guided, stable free cash flows from Switzerland and growing free cash flows from Italy. I'll move on to Switzerland, Page 20.

Revenue first, down CHF 27 million. B2C, minus CHF 23 million, pretty equal in the first 2 quarters.

The service revenue development was better in Q2 than Q1. You don't see it here in the total revenue numbers because there was a change in hardware revenues quarter-over-quarter, but we'll see the service revenue on the next page.

B2B down EUR 11 million with Telco service revenue down, also IT, but hardware up, as I mentioned already. On the Wholesale, you see quite nicely in the second quarter, plus CHF 5 million on wholesale.

For once, we have a quarter where roaming is not bouncing around much year-over-year. What emerges is the steady -- slow but steady growth from the wireline access business that will continue to go on for a very long time due to the fiber rollout.

EBITDAaL in Switzerland, slightly up CHF 13 million, adjusted CHF 10 million, as we saw on the first pages. B2C down CHF 10 million.

Telco service revenue partly compensated by cost savings. We had some shift of advertising from Q1 to Q2 compared to prior year.

This is why the improvement in Telco service revenue doesn't show up in the EBITDAaL number this quarter. B2B, minus EUR 8 million.

Here also Telco service revenue partly compensated the cost savings and in particular, the improvement in IT business EBITDAaL due to the factors that Christoph already mentioned shows up here also in the sequential evolution of year-over-year numbers. Infrastructure and Support Functions, cost savings flowing in as expected.

I move on to Page 21. You see it here on the top part of the chart, CapEx was down EUR 70 million.

It's almost entirely due to lower CapEx in the wireline access network, meaning in the FTTH rollout, this is mostly phasing, as mentioned. Just to be clear, we confirm the 60% FTTH coverage target for the end of the year.

With EBITDAaL slightly up and CapEx down, obviously, operating free cash flow is up EUR 83 million. Page 22, deep dive on the Swiss numbers.

On top right, the Telco P&L. You see here the plus CHF 42 million that we delivered in the first half of the year.

I'm not going to comment any further on the phasing. We already did that.

Top left, you see the Telco service revenue development very nicely. B2C in Q1, minus CHF 16 million and year-over-year and in Q2, only minus CHF 3 million.

This is the price increase that works as planned. ARPU effects are improving both in wireless and in wireline.

Now there are a couple of more moving pieces than just the price increase also going ahead into the third and the fourth quarter, particularly roaming in the third quarter. We don't expect this minus EUR 3 million of Q2 to be the run rate for the coming quarters, rather for the second half of the year, we expect the B2C service revenue decline roughly in the range as in the first half of the year.

Total service revenue decline, B2B and B2B for the full year, we still expect to be in a similar range as 2025, which was around minus EUR 120 million, maybe slightly better given the recent development here on B2C. On to Italy, Page 23, revenue down EUR 118 million.

B2C minus EUR 56 million, which is essentially the service revenue decline you see in the quarterly evolution that service revenue decline improved significantly in Q2. We'll see it on the next page.

B2B, down EUR 82 million, mostly driven by lower hardware revenue with low margins, but also lower Telco service revenue. Q2 a bit better across all revenue categories.

In Wholesale, you see in Q2 the flat year-over-year number, 0 compared to prior year. This is the Poste loss kicking in also in the financial numbers.

In Q2, it was possible still to compensate the Poste loss by other MVNOs ramping up over the last 12 months and also the year-over-year positive development of our wireline business. This flat development will not be the case in the coming quarters as the Poste loss fully kicks in and also the Lyca loss that Christoph mentioned will play a role.

EBITDAaL, lower part of the page, EBITDAaL up EUR 104 million, adjusted EUR 98 million. It's mostly driven by the contribution margin in B2C, which is obviously in turn driven by the MVNO synergy ramp-up.

Contribution margin in B2B minus 15% reflects the lower revenues given the -- also the revenue mix of the revenue decline. Contribution margin wholesale is flat.

There's also a different mix of revenues as wireless revenues drop out with Poste and wireless -- wireline revenues come in with a lower margin. Then indirect costs were lower by EUR 50 million, 5-0.

In particular, Q2 was impacted by in-year phasing. That's not the number to use our favorite phrase to be extrapolated into the second half of the year.

On to Page 24. CapEx lower EUR 52 million overall.

Adjusted CapEx lower by EUR 71 million across all categories, as you can see, mostly from Q1, Q2 was much more in line with prior year. Under adjustments, you see the higher CapEx from the integration.

It's a bit masked by 2 or 3 other factors, but integration CapEx was higher than prior year by EUR 27 million. It's still ramping up.

For the full year, we expect up to EUR 200 million CapEx integration costs or up to EUR 100 million higher than in the prior year. Operating free cash flow is up by EUR 156 million in the first half of the year, but with the bulk of the integration CapEx yet to come.

Page 25, service revenue evolution in Italy, similar picture to Switzerland. Finally, on B2C, we see the value strategy at work also in year-over-year service revenue numbers.

We have been talking for a while about the impact on operations and on quarter-on-quarter figures. Now with mathematics at work, it also shows up in the full -- in the year-over-year numbers.

Q1 B2C service revenue was down EUR 35 million. Now in Q2, it's just minus EUR 22 million with a positive impact from the ARPU effect, both in wireless and in wireline, where in wireless, we have completed the back book to front book alignment.

In wireline, as Christoph explained, it's still going on. On B2B, also Q2 better than Q1, but obviously, B2B is always a bit more volatile with some onetime revenues that we had in Q2.

On to Page 26, synergies on track. We reached a quarterly run rate of EUR 80 million.

We are on track to deliver EUR 300 million plus for the full year. Integration costs, EUR 51 million so far.

We still expect up to EUR 250 million in total, out of which up to EUR 200 million in CapEx, as I mentioned already, the spike is yet to come. Also prior year 2025 was quite backloaded when it came to integration CapEx, and we expect the same for this year.

I'll now move back up to the group. Page 27, free cash flow bridge.

Free cash flow was up by CHF 221 million in the first half of the year, fully in line with operating free cash flow. Just 2 moving pieces in between.

On the one hand, the net working capital is always negative in the first half of the year. This year, we have a positive deviation compared to prior year of plus CHF 85 million.

On the other hand, we had a second moving piece, which is higher tax payments in Q2 of almost equivalent size. All in all, free cash flow increase is simply in line with operating free cash flow increase.

Also Page 28, net income, quite uneventful. Net income is up by CHF 43 million, simply driven by the higher EBITDAaL.

Page 29, given the results we just reported, we obviously confirm the full year guidance. with that, I hand back to the operator.

It's Polo Tang from UBS. I have 3 questions.

The first one is really just about Swiss price rises. You raised pricing on the Swisscom brand by, I think, 3%, 4% in April and by 1% to 2% on the Wingo brand that will take full effect by September.

I'm just curious, what's been the reaction from your customers? Given your competitors are also trying to land price rises, have you seen any changes in terms of behavior or promotional activity in terms of the market?

That's the first question. Second question is really just coming back to the soft guidance on Swiss Telco revenues.

You mentioned that you're still expecting CHF 120 million of decline for Swiss Telco revenues for the full year. But given that Q1 was CHF 25 million, Q2 was, I think, CHF 19 million.

I'm just trying to understand why you've left unchanged. Can you maybe talk about some of the headwinds and tailwinds to consider over Q3 and Q4?

I know you flagged the roaming drag in Q3, but is there anything else? My third question is really just a bigger picture question in terms of satellites.

How should we think about satellites in terms of impact or not in terms of the Swiss and Italian markets? Is there a difference in terms of how you think about the impact on broadband versus mobile?

Thank you, Polo. On the price increase, overall, I would say, reactions from customers was as expected.

You've seen that we had slightly elevated churn figures in Q1 and now churn is sort of normalizing again, but the price increase did generate incremental churn from our customers, both on mobile and on broadband. We also saw some increased down trading from the main brand to Wingo, which I think also highlights that the room for further price increases on the main brand is somehow limited.

Although our competitors also reacted with price increases, the market remains very promotional, especially on the MVNO front, but also the main MNOs are still out there with very aggressive promotions. On the one side, you have increases on the back book and front book, but at the same time, executing very aggressive promotions.

So this sort of counterbalances or affects some of the price increase, and we expect this to continue also in the coming quarters.

Okay. I'll take the second question on the service revenue guidance.

As you mentioned, our initial full year guidance was in a similar range to prior year, about minus CHF 120 million. I think the split last year was roughly minus CHF 70 million on B2B and minus CHF 50 million on B2C.

Now if we are in the first half of the year, we are at minus CHF 35 million. This is very much in line with what we gave as a full year guidance.

Yes, B2C is better. That the current figure of minus CHF 18 million would not be in line with minus CHF 50 million.

This is also why I said we expect something similar to the first half of the year in the second half of the year, maybe slightly better than the CHF 50 million we gave at the beginning of the year and also maybe slightly better than the minus CHF 120 million for B2C and B2B taken together. What prevents Telco service in our view for the full year to be something like minus -- on B2C, minus CHF 16 million first quarter, minus CHF 3 million second quarter and then another CHF 2 million, minus CHF 3 million in Q3 or Q4.

There are a couple of pieces. One I mentioned it's the roaming dynamics in the third quarter.

There's also packages for international calls, which was a bit in line with roaming and the geopolitical situation, which impacts travel patterns. Then finally, there is the gross adds dynamics as we still recover from the price increase that Christoph mentioned with gross adds quite weak.

Churn is coming up nicely in the [indiscernible] in the past, but gross adds still have to discover and this will also have an impact. These are the 3 things that we see.

Obviously, there might be things that we don't see. We came to the conclusion, the most plausible forecast, if you like, for the moment is the minus CHF 120 million, but maybe a bit better on the B2C side.

Coming to your question on satellite, I would say in -- I mean, probably the impact is, one, very hard to predict because technology is developing very quickly. Consumer perception is changing quickly.

At the same time, we have the ongoing fiber rollout and very different dynamics both in Switzerland for mobile and broadband. I think it's not so easy to give like a single answer to your question, probably requires some more nuanced look.

I think on the Swiss side, I believe the impact will be quite moderate because the broadband infrastructure we already have today is very performant, and we are progressing well with the FTTH monetization and then the migration to the FTTH network. Satellite, we see it mostly as a complement on the broadband side for sort of extreme rural areas where we will most likely not build out fiber infrastructure.

On the mobile side, at the moment, the networks in Switzerland are so good that we don't really see meaningful competition on the mobile side from satellite. We also rather see it as a complement delivering more resilience, especially for emergency communication or should a mobile tower sort of break down for a couple of hours.

I think in Italy, broadband, the situation is slightly different. There, you can also see already quite a big pickup from satellite services.

I think Starlink is quite successful in Italy, especially in the rural areas where there is no fiber and also the copper infrastructure is not that strong. That's why it's very important in Italy that the ongoing fiber rollout is really completed and that we reach 90% fiber coverage by end of the decade.

But also not only building out the coverage, but also starting to focus more on migration of copper to fiber infrastructure because we do believe that once the customer is on fiber, this product is far superior to what satellite can deliver and delivers a much better customer experience. It is the best way to ensure that there is not too much erosion on the broadband side or a loss of market share to the satellite services.

Like on mobile, as we said, we are testing mobile services to complement our mobile coverage with satellite. This could be an interesting avenue.

But also the mobile development on satellite will be very heavily impacted by the European regulation, which is still under discussion. Depending on what the EU regulate ultimately on the division of the MSS spectrum, it will have either a higher impact on mobile or a negligible impact depending on how much spectrum is really available to deliver services over satellite in the coming years.

It's Maurice Patrick from Barclays. Just a couple from my side.

The first question, you alluded to it in your prepared remarks around the spin down from main brands to discount brands in the Swiss market. I think historically, you have given some specific data points, very helpful on the spin down from main brand to discount brand.

You highlight, I think, in this presentation that continues. I'd love to get a sense in terms of if that sort of 2 to 3 percentage point annual swing is still at the same pace and maybe if that's going to continue through the rest of '26 and '27?

The second question, just on AGCOM and INWIT in Italy. AGCOM, the regulators come out proposing license extensions or spectrum extensions in exchange for higher quality delivery of mobile services.

Clearly, very helpful to get a cost tailwind if that comes through for you. But you remain in deadlock with INWIT, if I'm not wrong, having won the latest court case, which they're going to appeal.

I'm just curious to understand if those 2 processes can go in parallel, i.e., the extent to which you can agree or negotiate with AGCOM guaranteed improvements in mobile service whilst planning to remove your entire infrastructure from INWIT.

Maybe on the first one, I'm not sure whether you were referring to the impact of the shift to the second brand on service revenue or whether you were referring to cannibalization rates or the penetration. I'll try to cover whatever we have.

On mobile, the second and third brand penetration is at the moment at 38% on broadband, it's much lower 15%. That's one data point you might have had in mind.

On the service revenue, you see it on Page 22, where we highlight in the ARPU effect how much of this ARPU effect was driven by the change in brand mix. You can see that.

I don't think that we ever published anything on the topic. Did that help?

Yes. I mean just -- so 38% of your mobile is coming in the second and third brand on a fixed line was how much?

15%, some are coming in, but already in the base. So that's...

Of the base. Yes, I think it was -- sorry to jump in.

I think historically, you showed like a market share shift or rather a market -- it was like a diagram showing the extent to which your customer base is shifting from main brand to second brand.

Well, what we do have, obviously, we show on a regular basis, the penetration rate in the base. You can deduct the change in this penetration rate.

Year-over-year, the penetration rate went up by 3 percentage points on the mobile side. The 38% was respectively, 35% or whatever last year and also in broadband, it went up.

Now on your second question, Italy, AGCOM and INWIT. The AGCOM published the new rules a couple of days ago.

Actually, the details came out only this week. We are still analyzing the impact of exactly what this would potentially mean in terms of service coverage, service quality of service obligations and how we -- what kind of investments are required to fulfill these obligations.

I would say we can update you in more detail on the impact at the next quarter. Then we can also estimate if actually what AGCOM has proposed is net positive or net negative compared to the cost of spectrum or an auction.

I think this analysis is still ongoing. It looks encouraging, but it really depends a bit on the details of what is expected in terms of coverage and the quality of service investment.

Now irrespective of what AGCOM would like us to do on coverage and quality of service, we have, in any case, planned to continue to invest in our mobile network, both to densify the network that demand is increasing and to increase coverage. Ongoing investments in mobile are fully compatible with what we are doing on the INWIT side.

That's also one of the reasons why we launched the Tower JV because it will be one of the means to actually build out new towers and we are also in discussion with other tower operators to use existing towers for the densification. I would say both activities progress in parallel in the situation and at the same time, continuing to densify our mobile network.

It's Josh Mills here from BNP Paribas. A couple of questions from my side.

Firstly, on the Swiss price increases, it does look like alongside the service revenue tailwinds, the impact on churn and it hasn't been as negative as you might see it. Do you think that this could become more of a structural annual price increase?

Or is there a specific reason why for you, this is more of a 2026 one-off that wouldn't be repeated? I think you mentioned on the call that you don't want to test the limits of customer willingness to pay too much, but it does look like it could become a bit more structural.

Some of your thoughts around that would be helpful. Then secondly, on Italy, TI is challenging some of the MSA terms or at least having a discussion with FiberCop about them going forward.

Is that something that you're looking at doing? What does your current guidance strictly assume in terms of MSA costs?

Can you just explain whether there's any potential upside benefit if you were to secure better prices on the fixed line MSA?

Okay. On the Swiss price increase, I would say, yes, churn is coming down.

It was not that high, but I think every incremental churn is not something we want to see. Churn is only one aspect.

I think also what we saw on the NPS side, the NPS took quite a hit from the price increase. Customers do notice the price increase and are not really happy about it.

Looking at the market overall, being still very promotional with very aggressive offers, we believe that the room to make this like structural and having repetitive price increases is quite small. I wouldn't bet on the fact that the Swiss market moves into, let's say, a market structure where you see repeated price increases.

But it doesn't mean that we can't work on pricing going forward. I think one of the levers, which is more-for-more approach is always available.

This is what we are executing now with Wingo, changing the product structure, including more service and hence, increasing prices or the Swiss parliament is discussing several VAT increases. This obviously is also something that we need to take in account and could lead to potentially next price increases in the years to come.

I wouldn't exclude them, but we will be very careful about further price increases as the customer reaction we see also, we shouldn't push the customers too much, especially on the main brand. Now in Italy, I'm not sure if I fully got the question about the MSA.

Obviously, the INWIT discussion we have is about M&A and structurally improving our cost of the towers. I mean, you have seen that we have won the first legal proceeding.

We have the right to terminate the MSA. Migration is technically feasible, and we are preparing the migration now, but we are obviously also open to continue working with INWIT if the economic conditions meet our expectations.

Maybe I think you referred to, Josh, if I understood correctly, also to FiberCop, which is a complex regulatory situation, which we rather will not give an update today.

Can I sneak one extra one in just because in relation to Maurice's question, I know you stopped disclosing on a quarterly basis, the penetration of sub-brands, but it looked like at the end of last year, the sub-brand penetration increased by about 2%. It's now increasing by about 3%.

Then also the spin down or the brand mix on wireless ARPU has increased a bit quarter-on-quarter. Does that fit with the message you're giving today that there has been a bit more of a spin down versus Q1, just to check those numbers.

I can't confirm the exact numbers, and there might also be some rounding in there. But yes, Christoph already mentioned that the price increase led to an increase in spin downs of customers from the main brand to the second and third brand.

That's consistent with what you see.

It's Paul Sidney from Berenberg. Just a couple for me, please.

The Swiss spectrum auction in 2027 seems to be going against the trend of extending license terms that we've seen in Germany and Italy. I was just wondering, is there any reason that Switzerland is going down this route?

And could the auction raise the risk that Swisscom's spectrum advantage in Switzerland is eroded, spectrum potentially reserve for new entrant or even SpaceX looks to bid, which is obviously a sort of nightmare scenario. Then just in Italy, I was intrigued to hear your CHF 100 million of revenue from the B2C energy customers, 141,000.

I just wonder, is there an opportunity to upsell further services to your customer base? Obviously Poste is selling insurance, wealth management services and I think planning to sell the services across the TI base post the transaction completion, but like to hear your comments there.

Okay. Thank you.

Spectrum auction, yes, it's a fact that the Swiss are slightly going against the trend we see in Europe, but the regulator made it clear that they will not extend licenses, but will go for an auction. I think that's quite clear going forward.

We will obviously make sure that we can repurchase the frequencies we have today as we believe that this is an important asset that we need to have also in the future to guarantee the quality of service of our network and looking at the number of customers we have on our network. How the auction will proceed exactly, we will see once the regulator has published the final rules, which should happen until the year-end.

Then I think we can also comment a bit more on how we see the auction playing out. Now in Italy, the CHF 100 million energy is not only B2C, it's including B2B.

It's the full energy business. But it's indeed good to see that we can sell other products to our B2C customer base.

We are also looking into other avenues like security or insurance also in Italy to basically increase the share of wallet in our customer base. That's something we are looking into and could be new growth drivers for Italy going forward.

Yes. Mark [indiscernible] from [ Finance Wichoft ].

I have 3 short questions concerning the mobile spectrum. Given that it will be an auction in Switzerland because that's news for me it's still in play.

The second question is about the service revenue decline in Italy. Will we have to get used to it in the coming years?

Will there always be a decline? Did you give a concrete number for Italy for this year as you did for Switzerland, this slightly less than CHF 120 million.

Is there an equivalent figure for Italy? The third and last question is about the competitive situation in Italy.

Do you still think that there is the chance that there will be a merger among one of your competitors and then you will have one less? I mean there still is, I think, a rumor going on about Iliad.

And yes, if Iliad is going to merge with a competitor.

Okay. Thank you for the question.

On mobile spectrum, yes, it's not finally decided. You're completely right that there will be an auction, but this is our expectation that there will be an auction and no prolongation of spectrum, but the final decision is still pending and will be communicated by the regulator.

But I think it's safe to assume that there will be an auction. You want to take that.

Question number 2. Yes, there is a number out there that we mentioned in the full year results conference.

We expect the service revenue decline in Italy of roughly CHF 150 million, which is much improved over the previous year, and we expect for the future a gradual stabilization of that number without any specific guidance at the moment for 2027 onwards.

Sorry, on your last question, merger in Italy, I mean, there are always lots of rumors going on. Of course, we don't comment on these rumors.

I don't know if there -- I mean, we don't know what other parties are talking about.

Okay. And just maybe for clarification.

So you say CHF 150 million was the outlook. And did I understand correctly that you're saying the service revenue decline is going to -- that this trend is going to continue in the coming years in Italy?

It's going to gradually ease over time, but we don't give any specific time lines or numbers beyond the 2026 guidance.

Okay. Gradually easing.

It's Christian Bader from ZKB. Actually my question has just been answered.

It's regarding Telco service revenues in Italy at the first quarter conference call, you said you expect CHF 150 million loss this year. I just wondered if you confirm that number.

Confirmed.

It's Robert Grindle from Deutsche Bank. I'd just like a reminder, please, about the accounting and cash treatment of the Vodafone compensation for the loss of the Poste MVNO.

Does that come through at all in Q2? And what's the phasing from here?

Is there any compensation from Vodafone for the loss of the Lyca MVNO?

Yes. Thanks, Robert, for the question.

On Lyca, no, there is no compensation. Yes, there is a compensation on Voda on the Poste deal.

We are going to book it in either Q3 or Q4 in one go at CHF 75 million, and we will treat it as an adjustment.

It's Ajay Soni from JPMorgan. Two quick questions.

On the price rises, I think it's clear the main brand situation is not clear and there's caution here going ahead. On the second and third brands, do you feel more comfortable pushing through consistent price rises here as I think you have done in the last couple of years?

Obviously, this section of the market remains very competitive. Then just bigger picture on the Italian synergy.

You've owned the Vodafone asset for a couple of years now. Have you seen any further synergy opportunities?

Where would these be? Could you quantify any of them?

Thank you. On second and third brand, there might be more room to work consistently on price.

I mean now we are executing the second price increase in Wingo. We will see how this goes.

We will gather more experience and we can then decide next steps going forward. On the IT synergies, I think we still have to realize the other 50% of synergies.

We delivered CHF 300 million out of the CHF 600 million. There is still a lot of work to be done.

We are confident that we can deliver the full CHF 600 million based on what we see today. But we will not announce additional synergies as we first need to already deliver what we promised 2 years ago.

Thank you very much. And with that, I would like to conclude today's conference call.

If you should have any additional questions, please feel free to reach out to the IR team. We look forward to speaking to you, and have a pleasant day.

Thank you.