Berenberg: Telia deal will boost Viaplay’s Q4 numbers

Nordic and international streamer Viaplay’s surprise agreement with Telia in December will boost its Q4 numbers, increasing its subscriber count and providing carriage and ad revenues that will boost revenue and earnings, according to analysts at Berenberg.

According to the analysts, its previous downgrade in Viaplay’s 2022 outlook was heavily influenced by the loss of 200,000 Nordic subscribers reported last year, which was mostly down to the loss of those subscribing via Telia.

Berenberg had previously estimated that only 125,000 of the 200,000 customers lost after the ending of Viaplay’s agreement with Telia would return to the streamer in Q4. However, the outfit said it understood that Telia customers “who were kicked off Viaplay in October”, and who still had a TV subscription with Telia, recovered access to Viaplay in December.

“While this does not mean Viaplay has recovered all previously “lost subscribers”, this does make the level of net adds required in Q4 to reach its guidance more manageable,” Berenberg concluded.

According to the analysts, Viaplay had also previously factored in a SEK150 million negative impact in advertising revenues in 2023 as a result of the loss of distribution via Telia, along with a loss of SEK250 million a year in carriage fees.

The return of this revenue will have a positive impact this year and will add a small amount to the Q4 2022 numbers. While the total revenue numbers from these changes are small, Berenberg said that they would have a stronger impact on EBIT.

Berenberg upped its price target for Viaplay from SEK315 to SEK322.

Viaplay Group and Telia agreed a multi-year partnership in Sweden that will provide customers of both companies with access to a broader range of content in December. The agreement came just two months after the two firms parted company.

The two have deepened their sports co-operation, with selected UEFA Champions League, LaLiga and Serie A matches added to the Viaplay Total streaming package, and Swedish men’s national football team matches and selected UEFA Europa League and UEFA Europa Conference League matches shown on Telia’s C More streaming service.

Access to the Viaplay streaming service will be added to more Telia TV and streaming packages in Sweden in the course of 2023.