Spanish telecom giant Telefonica reported first-quarter earnings Wednesday, revealing that revenue fell 10 percent to €14.1 billion ($18.5 billion), even as net income grew 20.6 percent to €902 million ($1.1 billion).

The company reported that it lost 51,000 pay-TV subscribers in Spain in Q1.

Spain’s Telefonica continues to lose pay-TV (IPTV Spain) customers in its domestic market at a worrying rate, with 50k leaving in the first quarter of this year alone to reach 659k, although its Latin American operations helped partially rebalance these losses.

Across Europe as a whole, Telefónica saw its pay-TV customer base shrink 17% in the first quarter of this year on an annual basis to reach 852k

Revenue from Telefonica’s financially-strapped home market dropped 16 percent in part due to record-breaking 27 percent unemployment in Spain and increased competition from smaller rivals offering cheaper packages of voice, broadband and TV.

Telefonica CEO Cesar Alierta said the mixed results reflect “a progressive stabilization of the business and a greater degree of diversification, together with the constant improvement in the financial position.”