Turkcell's Q4 2024 Earnings Call: Contradictions on 5G Timeline, Churn Rates, and Inflation Assumptions

These are the key contradictions discussed in Turkcell's latest 2024Q4 earnings call, specifically including: 5G tender timeline and investment size, churn rate and pricing strategy, CapEx over sales ratio, and inflation assumptions:



Revenue Growth and Profitability:
- Turkcell reached a top line of TRY 16.7 billion for the full year 2024, reflecting a 7.8% year-on-year rise, surpassing their guidance.
- With a strong focus on profitability, they achieved TRY 69.8 billion in EBITDA, maintaining a solid margin just below 42%.
- This growth was driven by disciplined pricing strategies, upselling to postpaid plans, and double-digit ARPU growth.

5G Investment and Network Expansion:
- Turkcell successfully tested 5G in football stadiums, achieving download speeds over 1 Gbps, demonstrating their readiness for 5G deployment.
- The company plans to increase base station fiberization to 48% and enhance data center capacity by 27%, highlighting its commitment to technological advancements.
- These efforts are aimed at enhancing connectivity and supporting next-generation applications.

Digital Services and Paycell Growth:
- Digital business services generated TRY 4.4 billion in revenue, with recurring service revenues rising 19% year-on-year.
- Paycell, Turkcell's mobile payment platform, achieved 33% growth in Q4, driven by higher commissions and transaction volumes.
- The growth in these sectors is attributed to increased adoption of mobile payment platforms and strategic partnerships.

Churn Management and Customer Retention:
- Turkcell managed to keep its mobile churn rate around 2% despite aggressive competition, indicating effective churn management.
- Higher churn was mainly observed in the prepaid segment due to alternate data solutions and intense competition.
- The company's focus on churn management and strategic pricing helped maintain customer retention levels.