Telefonica S.A. — Investor Presentation 2023

May 11, 2023

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Q1 23 Results

Mr. Ángel Vilá COO

Delivering on our goals

	Core Markets			T. Hispam	Value-Adding Group
	Service revenue growth accelerating, improving OIBDA trend y-o-y Double digit revenue & OIBDA growth	Scaled European Cloud/Cyber champion	Best infra portfolio	-28% invested capital since Dec-19	Open Gateway project
Key developments	Excellent progress in 5G >82% pop. cov; robust rev. & OIBDA evolution Accelerating revenue growth	Revenue +43.5% y-o-y	Growth in Telxius	13% OIBDA-CapEx/Sales	Twin transition greenabler
	In-market consolidation prospects Growth + Lower capital	Double digit revenue growth	Rollout execution	Optionality	Fair Share consultation
Looking ahead…	intensity Normalised CapEx/Sales >50% synergies run-rate in YE 23	Potential source of value	Consolidation prospects Networks expansion	Self-sustainability	Pursuing fairer regulation environments

A strong start to 2023

Strengthened commercial position

• Fibre (+16% y-o-y); mobile contract (+7% y-o-y); 5G coverage increasing
• Investing for growth = higher NPS, lower churn, pricing power proven
• CapEx focus on NGN

Ramping-up revenue growth y-o-y (reported and organic)

• Consistent service revenue growth acceleration; +4.2%
• Price increases well received
• Very strong B2B revenue; +9.0%

Resilience; proactive management of efficiencies

• Streamlined operating model
• Underlying OIBDA growth for 3rd straight quarter
• Strong FCF generation even under seasonality

Balance sheet optimisation

• Light maturity profile and strong liquidity
• Limited debt refinancing
• High portion of long-term fixed rate debt

Sustainability pathway; transformation of networks Legacy copper switch-off in Spain by April 2024

Key financial metrics

	Q1 23			Q1 23
	Reported + 50% VMO2 (€m)	Organic y-o-y		Reported (€m)	Reported y-o-y
			Revenue	10,045	6.7%
Revenue	11,497	4.9%	OIBDA	3,121	(2.4%)
			OIBDA Underlying	3,145	2.4%
OIBDA	3,634	1.1%	Net Income	298	(57.9%)
			FCF (incl. leases principal payments)	454	(11.6%)
OIBDA-CapEx (ex-spectrum)	2,320	2.1%	Net Financial Debt ex-leases	26,443	(3.5%)

Positive FX impact Debt -€0.2bn
€ (m)	Q1 23
Revenue	136
OIBDA	47

Well on track for 2023 guidance

2023 guidance

organic

	Targets	2023	Q1 23
Revenue y-o-y organic		"Low single digit growth"	+4.9%
	OIBDA y-o-y organic	"Low single digit growth"	+1.1%
	CapEx/Sales organic	~14%	11.3%
	Shareholder remuneration
	2023 Dividend	€0.3/share (cash)		2023 calendar payments 15th June 2023 €0.15/sh.; cash 14th December 2023 €0.15/sh.; cash
	December 2023	€0.15/sh. (cash)
	June 20241	€0.15/sh. (cash)		24.8m own shares cancelled

On target to achieve ESG goals

		Environmental		Social		Governance
Key targets		Net-zero by 2040 (SBTi validated) 100% renewables by 2030 Zero-waste by 2030		>90% MBB rural coverage by 20241 33% women executives by 2024 Zero adjusted pay gap by 20242		Parity3 in top governing bodies by 2030 Zero-tolerance of corruption 30-35% sustainable linked financing by 20244
	✓	Reducing emissions: Copper switch-off (SP); CDP Supplier Engagement Leader	✓	Connecting communities: e.g. >80% 5G coverage in SP & DE. UK social tariffs	✓	Best practices in Corporate Governance: all BoD proposed resolutions approved at AGM
Examples of	✓	Development and use of renewables. BR: +3 distributed generation plants, DE: +1 PPA	✓	Ranked #1 in WBA's Digital Inclusion nd Benchmark: 2 consecutive year	✓	ESG at the core with ISO certifications renewed across T. Hispam
our progress	✓	Circular economy: Q1 ~10k used network units sold to 3rd parties; recycling 98% of waste	✓	st Driving diversity and inclusion: 1 VMO2 UK Gender & Ethnicity Pay Gap report	✓	Financing linked to sustainability criteria: leading the sector with €17bn
				H

²Adjusted pay gap: equal pay for jobs of equal value 3. Parity defined as not less than 40% of each gender represented

¹ Core markets.

1. Financing linked to sustainability criteria includes balance sheet debt, hybrids and undrawn committed credit lines based on ICMA sustainable

bond principles, LMA Sustainability Linked Loan Principles and other ESG criteria. Not necessarily linked to EU Taxonomy aligned activities

Spain

(56)

(27) (26)

91.1 90.1 90.1 90.3 92.6 1.3% 1.1% 1.2% 1.0% 0.9% Convergent KPIs Net adds (k) 6 3 1 21 3 ^{14 23} (9) (5) FBB Postpaid Convergent Q1 22 Q2 22 Q3 22 Q4 22 Q1 23

Revenue & OIBDA growth (y-o-y organic)

Commercial momentum

Best Q trading post-pandemic FBB y-o-y growth after 4 years Further churn reduction (-0.4 p.p. y-o-y) Tariff update (Movistar +6.8% avg. Q1 23)

Service rev. accelerated (+1.0% y-o-y) on improving retail OIBDA on the path to stabilisation Benchmark (OIBDA-CapEx)/Sales (26% organic)

60% of B2B portfolio EcoSmart Supporting circular economy (device buy back)

Germany

(10)

5

Fixed BB net adds (k)

Q1 22 Q2 22 Q3 22 Q4 22 Q1 23

19 18

25

Revenue & OIBDA (y-o-y organic growth)

and growth "Very good' rating in connect test >82% 5G pop. coverage (Mar-23); on track for ~90% target at YE 23 M4M implemented for 'O2 Mobile' portfolio (~10% higher price points) Sustained own-brand momentum,

Good commercial traction

driving strong revenue & solid OIBDA growth

Improved ESG scores

Virgin Media O2

101 114 115 188 108 Fixed network build (k; PPs)

Mobile contract churn (%)

Q1 22 Q2 22 Q3 22 Q4 22 Q1 23

Revenue & OIBDA growth (y-o-y organic)

Focus on operational progress and long-term growth

Seasonality in mobile contract base, low and stable churn levels y-o-y (1.0% in Q1 23)

108k PPs in Q1 23 and 5G connectivity >2,100 towns and cities

Revenue growth accelerating y-o-y

Mobile pricing environment improving

Expansion of eligibility for social tariffs

Revenue & OIBDA growth (y-o-y organic)

Highest revenue growth in 10 years

Contract m. share: 43.7% (+2 p.p. since Oi deal)

Contract churn: 1.1%; healthier environment Price increases in Contract and Hybrids

Digital services gaining traction: >2m OTT video subscribers B2B digital revenue: >6% o/total revenue

Lower CapEx intensity:+22.7% y-o-y OIBDA-CapEx

3rd straight year as CDP Supplier Engagement Leader

T. Tech, a global next-generation IT provider

• Double-digit y-o-y growth across T. Tech Companies
• Improved revenue mix:
  • o Higher weight of Managed & Professional services & own platforms revenues
  • o Better geographic distribution (>85% revenue hard currency)
• Differential customer journey
  • o Key driver for relevance in the B2B market
  • o Top position in large global B2B deals (4th in the Telco Global services outlook by Omdia 2023)
• Reinforced partner ecosystem & capabilities: AWS, Hitachi Vantara,Expert.ai.

Operational Highlights

Leader in B2B digital services: Cloud, Cybersecurity, IoT, Big Data

Strong Commercial activity

• Bookings growth ~+40% y-o-y in L12M
• Healthy funnel generation

Highly skilled and diversified team

• Talent-led organisation: hiring, skilling & retaining
• >6.2k professionals; 80% located in Europe
• ~4k certifications
• 18% attrition in L12M

Industry Analysts Recognition

Very Strong in Managed Security and Private LTE/5G Network Services

Leader in Magic Quadrant Managed IoT Connectivity Services (9th consecutive year).

Frost Radar: TOP 12 in Americas Managed and Professional Security Services

T. Infra, consolidating our leadership of FibreCos and critical infrastructure

The best combination of profitability and growth 70% 30% 5 th quarter of consecutive organic² OIBDA growth 4.7% 6.0% 8.4% 10.4% Revenue OIBDA Organic Reported Q1 23 12 54.2% OIBDA margin +0.7 p.p. y-o-y organic

¹Included in the total Group's FTTH PPs ²Constant perimeter (excluding tower business)

Q1 23 Results

Mrs. Laura Abasolo CFCO & Head of T. Hispam

T. Hispam, capturing value growth opportunities

FTTH & Cable PPs (m)

Margins (organic)

-28% Invested Capital (since Dec-19) Value growth & tariff update Revenue growth boosted by contract & FTTH OIBDA affected by commercial activity and InfraCo model OIBDA-CapEx expected to grow in FY 23

Making progress in digital inclusion

Further deleverage, sound liquidity and contained cost

Comfortable liquidity position

Gross debt maturities, Mar-23 (€bn)

2023 2024 2025 2026

Deleverage trend continues

Net Debt/OIBDAaL

Contained interest payment cost

Total debt related interest payment cost ex leases

Conclusions

Mr. Ángel Vilá COO

Positive momentum in Q1 23

• Strong start to the year, resilience; consistent execution of strategy
• Accelerated growth in revenues (reported and organic y-o-y); pricing power, leading churn and NPS
• Pricing actions and efficiencies more than offset inflationary pressures

• Good progress in fibre, mobile contract and 5G, proving differential infrastructure
• Sustainability pathway: transforming networks
• Robust balance sheet, proactive approach to debt management

• Shaping the opportunities
• Reiterating guidance and dividend for 2023
• ESG a greenabler: anticipating regulatory needs (EU taxonomy, PAI, SFDR Art. 8 & 9)

Results presentation and Q&A Session

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Telefónica's management will host a webcast on 11 May at 10:00 AM (CEST), 9:00 AM (GST), and 4:00 AM (EDT)

Participants from Telefónica

• Ángel Vilá l COO
• Laura Abasolo l CFCO & Head T. Hispam
• Lutz Schüler l CEO Virgin Media O2
• Eduardo Navarro l Chief Corporate Affairs & Sustainability Officer
• Adrián Zunzunegui l Global Director of Investor Relations

• To access the webcast: click here
• The webcast replay will be available on Telefónica IR's website after the event

• To participate in the Q&A session, please register using the following link to receive the dial in and PIN details. click here.

Bloomberg GEI 2023

A List 2022

Member of DJSI Europe

st in sector 2022

1

1 st company worldwide in 2022 Digital Inclusion Benchmark

For further information, please contact: Investor Relations Adrián Zunzunegui (adrian.zunzunegui@telefonica.com) Isabel Beltrán (i.beltran@telefonica.com) Torsten Achtmann (torsten.achtmann@telefonica.com) Tel. +34 91 482 87 00 ir@telefonica.com www.telefonica.com/investors