SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the

Securities Exchange Act of 1934

For the month of February 2008

Commission File Number 1-13758

PORTUGAL TELECOM, SGPS, S.A.

(Exact name of registrant as specified in its charter)

Av. Fontes Pereira de Melo, 40
1069 - 300 Lisboa, Portugal

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Lisbon, Portugal, 28 February 2008

Portugal Telecom announced today its full year results for the year ended 31 December 2007.

In 2007, consolidated operating revenues amounted to Euro 6,148 million, an increase of 6.6% y.o.y. Reported EBITDA increased by 5.3% y.o.y to Euro 2,357 million, equivalent to a margin of 38.3%, and income from operations increased by 11.5% y.o.y to Euro 1,234 million. Reported net income for the period amounted to Euro 742 million, a decrease of 14.4% over the same period of last year. On a comparable basis, adjusting for exceptional items, EBITDA and net income would have increased by 6.7% y.o.y and 26.3% y.o.y respectively in 2007. EBITDA minus Capex totalled Euro 1,457 million, an increase of 6.4% y.o.y. As at 31 December 2007, net debt amounted to Euro 4,382 million and after-tax unfunded post retirement benefit obligations totalled Euro 958 million.

PT’s financial results have been prepared in accordance with International Financial Reporting Standards (IFRS). Following the shareholder approval of the PT Multimedia (PTM) spin-off on 27 April 2007, PT Multimedia was considered as a discontinued operation for reporting purposes. The spin-off was fully concluded on 7 November 2007.

(1) EBITDA = income from operations + depreciation and amortisation. (2) EBITDA adjusted for several exceptional items as described in table 3. (3) Income from operations = income before financials and income taxes + curtailment costs + losses (gains) on disposal of fixed assets + net other costs (gains). (4) Net income adjusted for several exceptional items as described in table 4. (5) Excludes the commitments under the terms of the UMTS licence (Euro 231 million in 4Q07 and Euro 242 million in 2007). (6) EBITDA margin = EBITDA / operating revenues. (7) Net debt divided by EBITDA. (8) Net debt plus after-tax unfunded post retirement benefit obligations divided by EBITDA excluding PRB.

Income Statement

Consolidated operating revenues increased by 6.6% y.o.y in 2007 (+9.3% y.o.y in 4Q07), driven by growth at Vivo, TMN and Other Businesses. Vivo operating revenues increased by 17.0% y.o.y in Euros and by 14.2% y.o.y in Reais in 2007, primarily on the back of continued growth in customers and ARPU, as well as interconnection effects (bill & keep). TMN operating revenues increased by 2.7% y.o.y, underpinned by continued customer growth, particularly in postpaid. Wireline operating revenues decreased by 5.3% y.o.y in 2007, as a result of the impact of continued line loss and pricing pressure on retail revenues, notwithstanding the improvement in wholesale and data & corporate revenues. Other revenues (including intra-group eliminations) increased to Euro 180 million mainly as a result of the consolidation of MTC (Euro 79 million) as from September 2006, and the increase in revenues of other international fully consolidated subsidiaries.

(1) Considering a Euro/Real average exchange rate of 2.7315 in 2006 and 2.6661 in 2007. (2) EBITDA = income from operations + depreciation and amortisation. (3) Income from operations = income before financials and income taxes + curtailment costs + losses (gains) on disposal of fixed assets + net other costs (gains).

EBITDA increased by 5.3% y.o.y in 2007 to Euro 2,357 million and EBITDA margin decreased by 0.5pp y.o.y to 38.3%. Adjusting for exceptional items (Table 3) mainly related to prior years service gains at Wireline and provisions at Vivo, EBITDA would have increased by 6.7% y.o.y, and the margin would have remained flat at 36.3%. EBITDA improvement in the period was driven primarily by growth in the mobile divisions, Vivo and TMN, and the increase in Other Businesses. Vivo EBITDA increased by 19.9% y.o.y (17.0% y.o.y in local currency), primarily on the back of the strong increase in top-line. As for TMN, EBITDA increased by 3.1% y.o.y, driven by robust customer growth, in voice and data, combined with strict cost control, notwithstanding increased commercial activity (+20.8% increase in gross additions). Wireline EBITDA decreased by 6.0% y.o.y, mainly as a result of the decrease in prior years service gains in 2007. Excluding this impact, underlying EBITDA would have decreased by 2.6% y.o.y, with the 1.3pp improvement in underlying EBITDA margin resulting from the continued reduction in personnel-related and other operating costs. Other EBITDA increased to Euro 74 million in 2007, mainly as a result of the consolidation of MTC (Euro 38 million) as from September 2006, and the increase in EBITDA of other fully consolidated subsidiaries.

(1) Considering a Euro/Real average exchange rate of 2.7315 in 2006 and 2.6661 in 2007. (2) EBITDA = income from operations + depreciation and amortisation.

Curtailment costs amounted to Euro 276 million in 2007, including a cost of Euro 289 million related to the reduction of 1,004 employees and a gain of Euro 14 million related with the settlement of benefits. In 2006 curtailment costs amounted to Euro 19 million due to the booking of net gains of Euro 209 million related to the termination of the protocol with the national healthcare system. Work force reduction programme costs in 2006 amounted to Euro 228 million corresponding to the reduction of 772 employees.

Net interest expenses decreased by 10.3% y.o.y to Euro 197 million in 2007, mainly as a result of the reduction in the average cost of debt in Portugal and in Brazil, as well as the decrease in Vivo’s average net debt in the period, notwithstanding the increase in PT’s average net debt in the period due to the execution of the share buyback.

Equity in earnings of affiliates amounted to Euro 126 million in 2007, as compared to Euro 131 million in 2006, on the back of the reduction in the contribution from Médi Télécom (Euro 3 million in 2007 vs. Euro 46 million in 2006) resulting primarily from the recognition in 2006 of tax losses carried forward from previous years. The contribution from PT’s main affiliated companies increased across the board, namely Unitel (Euro 92 million vs. Euro 83 million), CTM (Euro 17 million vs. Euro 15 million) and UOL (Euro 13 million vs. Euro 6 million).

Net other financial gains, which includes net foreign currency gains, net gains on financial assets and net other financial expenses, amounted to Euro 188 million in 2007, as compared to losses of Euro 29 million in 2006. In 2007, net gains on financial assets included gains related to: (1) the sale of 22% of Africatel (Euro 111 million), the holding company that aggregates all of PT’s interests in Africa excluding Médi Télécom; (2) the equity swap contracts on PTM shares (Euro 77 million in 2007 vs. Euro 10 million in 2006); (3) the disposal of the investment in the shares of Banco Espírito Santo (Euro 36 million), and (4) the cash settlement of equity swaps on PT own shares (Euro 32 million in 2007 vs. Euro 24 million in 2006).

Provision for income taxes amounted to Euro 243 million in 2007, as compared to a gain of Euro 21 million in 2006. The change in this item is primarily explained by the: (1) Euro 53 million tax credit booked in 1Q06, in connection with the liquidation of a holding company; (2) Euro 142 million gain booked in 2Q06, in connection with the reduction of deferred tax liabilities resulting from the voluntary taxation of certain capital gains, and (3) Euro 134 million tax losses from previous periods booked by Vivo, following the completion of its corporate restructuring in 4Q06. Adjusting for these exceptional items, the provision for income taxes in 2006 would have amounted to Euro 308 million, with the adjusted effective tax rate thus falling from 35.9% in 2006 to 23.6% in 2007, mainly as a result of: (1) the reduction in the nominal tax rate in Portugal from 27.5% in 2006 to 26.5% in 2007; (2) the decrease in allowances for deferred taxes on tax losses generated by Vivo, following the corporate restructuring completed at the end of 2006, and (3) the booking of the non-taxable capital gains related to the disposals of 22% of Africatel and the investment in the shares of BES.

Income from discontinued operations includes the earnings of PT Multimedia before minority interests up to the end of October 2007, as a result of the spin-off of this division. In 2007, this item included costs related to the spin-off process amounting to Euro 24 million (Euro 18 million, net of tax) in connection with employee, organisational and IT restructuring costs.

Income attributable to minority interests increased to Euro 93 million in 2007 from Euro 87 million in the previous year, mainly as a result of the increase in income attributable to MTC minority interests (Euro 23 million in 2007 vs. Euro 9 million in 2006), which was consolidated as from September 2006, and Africatel (Euro 10 million in 2007), following the sale of a 22% stake of this holding company in August 2007. These effects were partially offset by the decrease in the income attributable to minority interests of Vivo (Euro 15 million in 2007 vs. Euro 34 million in 2006), primarily explained by the tax gains booked by Vivo in 4Q06.

Net income amounted to Euro 742 million in 2007, a decrease of 14.4% y.o.y, primarily as a result of the increase in curtailment costs in 2007 (Euro 276 million in 2007 vs. Euro 19 million) and lower provision for income taxes in 2006, which more than offset the increase in EBITDA and higher net financial gains. Adjusting for exceptional items, net income would have increased by 26.3% y.o.y in 2007 to Euro 608 million (see table 4).

(1) This item includes EBITDA related adjustments (see table 3). (2) Includes gains from the disposal of BES shares in the amount of Euro 36 million in 2007 and from the disposal of 22% of Africatel in the amount of Euro 111 million in 2007. (3) This item includes: (i) a tax credit related to the liquidation of a holding company in the amount of Euro 53 million in 1Q06; (ii) the voluntary taxation on deferred tax gains in the amount of Euro 142 million in 2Q06; (iii) the recognition of tax losses from previous periods at Vivo in the amount of Euro 135 million in 4Q06 and 2006, and (iv) the change in the statutory tax rate in Portugal from 27.5% to 26.5% in the amount of Euro 8 million in 4Q06.

Capex

Capex increased by 3.6% y.o.y in 2007 to Euro 899 million in 2007, equivalent to 14.6% of revenues. Wireline capex increased by 22.5% y.o.y to Euro 292 million, primarily due to: (1) network upgrades to provide greater bandwidth, in part related to IPTV services launched in June 2007; (2) the capitalisation of transponder satellite capacity for the DTH offer, which will be launched later this year, and (3) client-related capex. This increase was partially offset by the decrease in Vivo and TMN’s capex, with the latter being directed mainly towards the build up of network capacity and 3G/3.5G coverage. Capex at Vivo was directed towards to the GSM/EDGE overlay as well as network coverage and capacity. Other capex includes capex related to consolidated businesses not included in the main segments and support companies. In 2007, other capex increased to Euro 64 million, as compared to Euro 54 million in 2006, mainly as a result of the consolidation of MTC (Euro 17 million) as from September 2006.

(1) Considering a Euro/Real average exchange rate of 2.7315 in 2006 and 2.6661 in 2007. (2) Includes the capitalisation of Euro 43 million related with transponder satellite capacity for the DTH offer. (3) Excludes the commitments under the terms of the UMTS licence (Euro 231 million in 4Q07 and Euro 242 million in 2007).

Cash Flow

Operating cash flow amounted to Euro 1,433 million in 2007, a decrease of 9.7% y.o.y. The reduction in operating cash flow is explained by the working capital investment in 2007, versus a divestment in 2006, primarily as a result of higher commercial activity at TMN and Vivo.

(1) Includes dividends received from PTM (Euro 54 million in 2007 vs. Euro 58 million in 2006) and Unitel (Euro 73 million in 2007 vs. Euro 15 million in 2006).

Free cash flow increased by 50.5% y.o.y to to Euro 1,242 million in 2007, primarily as a result of: (1) the increase in net disposals of financial investments; (2) lower interest paid, and (3) lower contributions and payments related to post retirement benefits, as a result of the Euro 87 million reimbursement made in 2007 by PT Prestações, the fund created to cover healthcare responsibilities, on account of healthcare expenses paid by PT in 2007 and in previous years. These effects were partially offset by higher income taxes paid, which increased since PT’s tax losses carried forward were fully used in 2006.

Net disposals of financial investments in 2007 included primarily the disposal of the investment in the shares of BES (Euro 111 million), the cash settlement of the PTM equity swap (Euro 94 million) and the proceeds from the sale of a 22% stake in Africatel (Euro 117 million). In 2006, net acquisitions of financial investments included mainly the acquisition of a 34% stake in MTC (Euro 108 million) and PT’s investment in the capital increase of BES (Euro 19 million).

The reduction in interest paid from Euro 311 million in 2006 to Euro 234 million in 2007 is explained mainly by: (1) the fact that PT paid in 2006 the last annual interest installment (Euro 52 million) of the Eurobond repaid in 2006; and (2) by the decrease in Vivo’s interest payments resulting from the reduction in the cost of debt and the decrease in average net debt.

Consolidated Net Debt

Consolidated net debt amounted to Euro 4,382 million as at 31 December 2007, as compared to Euro 3,757 million as at 31 December 2006. The increase in net debt over the period is explained primarily by: (1) the share buyback currently under execution; (2) the recognition of the investments in UMTS commitments, and (3) the extraordinary contribution to the pension fund.

As at 31 December 2007, 80% of total debt was medium and long-term, and 64% of total debt was set in fixed rates. As at 31 December 2007, 86% of total debt was denominated in Euros and 14% in Brazilian Reais. The 50% share of Vivo’s net debt, proportionally consolidated by PT, amounted to Euro 370 million as at 31 December 2007. At the end of December 2007, approximately 95% of Vivo’s net debt was either Real-denominated or hedged into Reais.

(1) In 2007, this item included dividends paid by PT (Euro 517 million) and its subsidiaries. (2) In 2007, PT contracted equity swaps over 117.7 million own shares under the share buyback programme currently being executed.

The total undrawn amount of PT’s committed commercial paper lines and standby facilities stood at Euro 1,451 million as at 31 December 2007. The amount of available cash from the domestic operations plus the undrawn amount of PT’s committed commercial paper lines and standby facilities totalled Euro 2,672 million at the end of December 2007.

In 2007, PT’s average cost of debt and maturity was 4.9% and 6.7 years respectively, including loans obtained in Brazil and denominated in Reais. Excluding Brazil and the interest cost associated with the PTM equity swap (settled in 2Q07), PT’s average cost of debt was 3.7% in 2007. The debt maturity excluding Brazil was 6.7 years at the end of December 2007. In 2007, the net debt to EBITDA ratio was 1.9 times and EBITDA cover stood at 11.9 times. Considering also the after-tax unfunded post retirement obligations, the adjusted net debt to EBITDA ratio remained broadly flat at 2.3 times in 2007.

In July 2007, PT successfully issued a Euro 750 million exchangeable bond with a maturity of 7 years. The coupon was fixed at 4.125% and the exchange price at Euro 13.9859, which was adjusted to Euro 11.60 following the spin-off of PT’s interest in PT Multimedia.

Post Retirement Benefit Obligations

As at 31 December 2007, the projected benefit obligations (PBO) of PT’s post retirement benefits amounted to Euro 4,203 million, down 7.9% from Euro 4,563 million at the end of December 2006. PT’s post-retirement benefit plans have been closed to new participants since 1994 for pensions and 2000 for healthcare.

In 2007, following the introduction of changes to the Social Security rules (DL 187/2007 and Law 52/2007) and adjustments introduced by PT to the growth rate used to calculate pension complements, the PBO was reduced by Euro 122 million. The impact of this reduction includes Euro 110 million related to vested rights that were recognised as prior year service gains and Euro 11 million related to unvested rights, which are deferred and amortised over the average working life of active employees. In addition, PT settled the Marconi Melhoria plan, which resulted in a reduction of unfunded liabilities by Euro 14 million, recognised

as curtailment gains. In summary, gross unfunded obligations amounted to Euro 1,304 million at the end of 2007, whilst after tax unfunded obligations stood at Euro 958 million.

As part of the annual actuarial study, as from 31 December 2007 actuarial assumptions used to calculate the PBO were adjusted. These changes included the: (1) increase in the discount rate used for pensions and healthcare obligations from 4.75% to 5.25% and in the discount rate used for salaries from 4.25% to 4.75%; (2) increase in the inflation rate from 1.75% to 2.0%; (3) decrease in the growth rate of salaries from 2.25% to 2.0%, and (4) increase in the growth of the healthcare expenses from 2.75% to 3.0%.

Gross unfunded obligations decreased by Euro 351 million in 2007 to Euro 1,304 million, primarily as a result of: (1) the net actuarial gains booked in the period in the amount of Euro 285 million; (2) the reduction and settlement of benefits in the amount of Euro 135 million, and (3) the Euro 117 million extraordinary contribution made in 2007, notwithstanding the Euro 291 million work force reduction costs incurred in the period.

(1) In 2007, the PRB gain recorded in the income statement amounted to a gain of Euro 65 million, including a gain of Euro 2 million related to the amortisation of prior years service gains of unvested rights. (2) In 2007 curtailment cost recorded in the income statement amounted to Euro 276 million, and excludes Euro 15 million related to the spin-off of PTM which were recorded under “discontinued operations” and includes a gain of Euro 2 million related to the extraordinary recognition of deferred prior years service gains.

In 2007, contributions and payments included: (1) Euro 38 million of regular contributions; (2) Euro 175 million of salaries to pre-retired and suspended employees; (3) Euro 61 million of net reimbursements related to healthcare benefits, and (4) Euro 117 million related to an extraordinary contribution to the pension funds.

As set out below, post retirement benefit costs were negative Euro 65 million in 2007, compared with a gain of Euro 72 million in 2006, mainly due to the decrease in prior years service gains of Euro 40 million recorded. The decrease in service cost in 2007 is explained primarily by the reduction in healthcare obligations that occurred at the end of 2006, while the decrease in net interest cost is explained by the narrowing of the unfunded gap.

(1) In 2007, this item includes Euro 110 million related to vested rights and Euro 2 million related to the amortisation of prior years service gains on unvested rights.

Shareholders’ Equity

(1) This item is primarily related to the changes in the Euro/Real exchange rate. (2) In 2007, PT contracted equity swaps over 117.7 million own shares under the share buyback programme currently being executed. (3) In 2007, this item includes Euro 36 million corresponding to the offset of the gain obtained on the disposal of the investment in the shares of Banco Espírito Santo recorded in the income statement in 2Q07. (4) This item includes primarily Euro 28 million related to price resets on existing equity swap contracts on own shares.

As at 31 December 2007, shareholders’ equity excluding minority interests amounted to Euro 1,338 million, a decrease of Euro 917 million in 2007. Distributable reserves decreased by Euro 871 million to Euro 1,856 million at the end of December of 2007, with the impact of the share capital restructuring (Euro 440 million), as approved by shareholders on 27 April 2007, and the net income generated in 2007 under Portuguese GAAP (Euro 613 million) being more than offset by the acquisition of treasury shares in 3Q07 (Euro 1,050 million) and the dividends paid in 2Q07 (Euro 517 million).

(1) In 3Q07, PT acquired 103 million own shares for a total amount of Euro 1,050 million, through the exercise of the physical settlement option of equity swaps contracted under the share buyback programme currently being executed.

As approved in the General Meeting held on 27 April 2007 and for the purposes of the execution of the share buyback programme, on 20 December 2007 PT reduced its share capital in the amount of Euro 3,091,695 through the cancellation of 103,056,500 treasury shares, corresponding to 9.13 % of the share capital, which were acquired in 3Q07 as mentioned above. As a result, PT’s share capital is now equivalent to Euro 30,774,000 represented by 1,025,800,000 shares.

As at 13 February 2008, PT had a total of 63,391,786 own shares of held through equity swap contracts, of which 20,640,000 shares were contracted under the previous share buyback programme. As part of the share buyback programme under execution, PT has acquired a total of 145,808,286 own shares, equivalent to 12.92% of PT’s share capital prior to the share capital reduction executed on 20 December 2007. With reference to 13 February 2008, the total amount returned to shareholders, through the share buyback programme under execution totals Euro 1,434 million. The number of outstanding shares, adjusting for equity swaps on own shares recognised in the balance sheet, is 962,408,214.

Consolidated Balance Sheet

As at 31 December 2007, the net exposure (assets minus liabilities) to Brazil amounted to R$ 7,525 million (Euro 2,898 million at the Euro/Real exchange rate of 31 December 2007). The assets denominated in Brazilian Reais in the balance sheet, as at 31 December 2007, amounted to Euro 5,454 million, equivalent to approximately 41.6% of total assets.

 (1) Considering a Euro/Real exchange rate of 2.8118 at year-end 2006 and 2.5963 at year-end 2007. (2) In 2007, this item includes Euro 26 million related to prior years service gains on unvested rights not yet recognised.

Wireline

Wireline operating revenues decreased by 3.9% y.o.y in 4Q07 to Euro 485 million, with the reduction in retail revenues more than offsetting the increase in wholesale and data & corporate revenues in the quarter.