Orange SA Shares Rise After Q3 Results

Shares of Orange SA (EPA:ORAN) rose by 1.7% on Thursday, buoyed by its third-quarter results, which met analysts' expectations.

The telecom giant reported strong growth in key financial metrics:
– EBITDAaL rose 3% year-over-year
– Operational free cash flow increased by 7% year-over-year

Performance Overview

Orange France’s top-line performance improved, rising 1.3% in Q3 compared to a 0.3% increase in Q2. This growth was driven by stronger convergence ARPU, which grew by 5% year-over-year, supported by stable retail demand and improved wholesale revenues that saw a smaller decline than in prior quarters.

“The key to the share price near-term will likely be the Investor Call, which will inevitably focus on the recent mini price war in France,” analysts at Morgan Stanley noted.

Market Challenges

Despite the price pressure, Orange has maintained a stable position, particularly in mobile net additions and convergence, although it experienced a slight decline in convergence additions. Analysts at Citi Research mentioned, “Though the mix is not disclosed, we believe that much of the EBITDAaL growth has come outside of France.”

Regional Performance

Outside of France, Orange's operations in the Middle East and Africa continued to perform strongly, with 10.5% growth in the region's revenues driven by high demand for mobile data services, Orange Money, and fixed broadband.

While Orange’s business solutions division faced challenges with ongoing revenue declines, the company expects the division’s EBITDAaL losses to halve by year-end, contributing to a broader positive outlook for the company.