Telefónica, the Spanish multinational telecommunications company, faced a significant loss of 4.318 billion euros in 2025, largely attributed to the accounting impact of selling its Latin American subsidiaries, asset depreciation, and the costs associated with the Employment Regulation File (ERE) in Spain. This loss is notably higher than the previous year's loss of 49 million euros and marks the second-largest loss in the company's history, only surpassed by the 5.576 billion euros loss recorded in 2002 during the implosion of Terra and subsequent UMTS license payments.

Despite the financial downturn, when excluding extraordinary items, Telefónica reported a net profit of 2.122 billion euros from its ongoing operations, showcasing a 7.9% decline from 2024. This indicates that the core business remains somewhat stable, albeit under pressure from external factors that have severely impacted overall profitability. The significant loss underscores the challenges facing Telefónica as it navigates the volatile telecommunications market while implementing large-scale restructuring efforts.

The upcoming years will be critical for Telefónica as it seeks to recover and stabilize its financial situation while focusing on its operations in Spain and Latin America. The company's performance in these markets will be closely monitored by investors and analysts, especially in light of its historical losses and ongoing challenges in adapting to a rapidly changing global telecommunications landscape.