Telefónica (NYSE:TEF) (LSE:TDE) released its January-September earnings today, with revenue growth of 5.4% and a 11.6% rise in free cash flow. The performance to September reflects its focus on setting the groundwork for future growth and allows Telefónica to reiterate its guidance for 2011 and confirm its shareholder remuneration policy. At 30 September, Telefónica reported strong growth in its customer base (+6%), with almost 300 million accesses across the world. Highlights include the success of the strategy to capture contract customers (accounting for almost 50% of mobile net adds so far this year), the penetration of mobile broadband services (accounting for 15% of the Company’s mobile accesses) and the increase in fixed broadband services (17.8 million customers to date). Telefónica reported a 5.4% increase in revenues to 46,672 million euros at the end of the third quarter, due mainly to the higher growth in revenues from mobile data services (up almost 20% in organic terms) and the sound performance of its business in Latin America, where reported revenues climbed 18%. Additionally, more than a quarter of consolidated revenues (26%) derive from the fixed and mobile internet business and revenues from services that go beyond connectivity, and the new organisational structure announced in September. This will allow the Group to focus on developing the digital world with these segments of activity as its main pillars, thereby increasing the weight of the revenues within the Telefónica Group and at the same time increase efficiency. Lastly, in addition to the positive impact of the revaluation to fair value of the pre-existing stake in Vivo at the time of the acquisition of the interest belonging to Portugal Telecom in 2010, January-September 2011 earnings were shaped by the provision recognised for restructuring costs following the agreement reached with the trade unions to reduce the headcount by up to 6,500 in Spain over the next three years. The latter measure has affected reported earnings but does not imply cash outflow. In reported terms, consolidated OIBDA totalled 14,251 million euros, operating income was 6,696 million euros and net profit stood at 2,733 million euros to September 2011. Excluding extraordinaries, the year-on-year change in these items would be 0.1%, -6.8% and -10.6%, respectively.