- Net revenue up 4.3 percent in the second quarter to 28.4 billion euros, service revenues up 4.9 percent.
- Adjusted EBITDA AL up 7.8 percent to 10.8 billion euros.
- Free cash flow AL up 48.5 percent to 5.2 billion euros.
- Adjusted net profit up 31.3 percent on prior-year figure to 2.5 billion euros.
- Free cash flow AL guidance now raised to around 19.0 billion euros from previously around 18.9 billion euros.
- Germany: strong customer growth.
- United States: milestone reached – more than 100 million postpaid customers.
- Europe: earnings growth at record level.
- Systems Solutions: positive trend continues.
Unbroken growth in all markets. Deutsche Telekom reliably delivered strong figures yet again for the second quarter of 2024. Service revenues increased by 4.9 percent year-on-year to 24.1 billion euros. At the same time, adjusted EBITDA AL grew 7.8 percent to 10.8 billion euros. Excluding the effects from exchange rate fluctuations and changes in the composition of the Group, i.e., in organic terms, growth amounted to 4.0 percent for service revenues and 6.6 percent for adjusted EBITDA AL. Free cash flow AL increased substantially by 48.5 percent to 5.2 billion euros.
“All our operations are performing well,” said Tim Höttges, CEO of Deutsche Telekom. “Quarter by quarter, we are seeing our strategy pay off.”
At 2.1 billion euros, net profit in the second quarter was up 35.6 percent against the same period of the prior year. Adjusted for special factors, net profit increased by 31.3 percent to 2.5 billion euros. This corresponds to adjusted earnings per share of 0.50 euros. After six months, adjusted earnings per share stood at 0.95 euros.
Following suit from T-Mobile US, Deutsche Telekom also raised its full-year guidance for free cash flow AL. The Group now expects around 19.0 billion euros, up from previously around 18.9 billion euros. There is no change in the guidance for adjusted EBITDA AL at around 42.9 billion euros, and for recurring adjusted earnings per share at more than 1.75 euros.
Germany: strong customer growth
Fiber-optic usage in Germany is gaining momentum. In the second quarter of 2024, the number of customers with pure fiber-optic lines increased by 113,000. The rate of growth has thus risen steadily over recent quarters, with the total number of customers using pure fiber-optic lines reaching over 1.2 million at the end of June. TV net adds stood at 114,000, with positive effects including the UEFA European Championship and the abolition of the privilege for property owners to pass on cable and internet service fees as ancillary costs to tenants (“Nebenkostenprivileg”) as of July 1, 2024. Broadband net adds for the quarter stood at 41,000.
Mobile communications also delivered strong figures. The branded contract customer base grew by 311,000 between April and June. Mobile service revenues increased by 3.7 percent year-on-year.
Revenue in the Germany operating segment amounted to 6.4 billion euros in the second quarter, up by 3.6 percent against the prior-year period. Adjusted EBITDA AL increased by just 1.0 percent to 2.6 billion euros, with the one-time payment to employees agreed in the collective agreement having a negative impact.
United States: milestone reached
T-Mobile US reached another milestone in its success story. As of June 30, the company reported more than 100 million postpaid customers for the first time. In the second quarter, postpaid net adds of 1.3 million were recorded, including 777,000 postpaid phone net customer additions. T-Mobile US once again delivered industry-leading growth with these figures.
Regarding financial performance indicators, adjusted EBITDA AL increased by 9.1 percent year-on-year to 7.8 billion U.S. dollars. At the same time, service revenues increased by 4.4 percent in the second quarter to 16.4 billion U.S. dollars.
Europe: profit growth at record level
The European national companies once again stepped up the pace of profit growth. Adjusted EBITDA AL reached 1.1 billion euros in the second quarter, an increase of 8.9 percent in organic terms against the prior-year quarter. The rate of growth is expected to slow in the second half of the year, as the tailwind from lower energy costs in the first six months compared to the prior-year period will fall off. Revenue grew by 6.8 percent in organic terms to 3.1 billion euros.
The strong growth in customer numbers also continued. The companies recorded mobile contract net adds of 183,000, broadband net adds of 53,000, and TV net adds of 23,000 in the second quarter.
Systems Solutions: growth in order entry
The positive trends in T-Systems’ business figures continued in the second quarter of this year. This is particularly the case for new deals, with order entry increasing by 28.3 percent to 957 million euros.
Revenue in Systems Solutions totaled 981 million euros between April and June, an increase of 2.1 percent year-on-year. This revenue growth was driven by both business with cloud services and by digitalization solutions. Adjusted EBITDA AL rose by 1.4 percent in organic terms to 87 million euros.
The Deutsche Telekom Group at a glance
Comments on the table
New partners for the cell tower business
On July 13, 2022, Deutsche Telekom agreed to sell a 51.0 percent stake in the tower business companies in Germany and Austria (GD Towers) to DigitalBridge and Brookfield. The transaction was consummated on February 1, 2023. From this date onward, GD Towers is no longer included in the Group’s figures as a fully consolidated entity.
The sale resulted in a gain on deconsolidation in the first quarter of 2023 of 12.9 billion euros. This extraordinary income has been eliminated from the adjusted net profit for the first half of 2023 and the full-year 2023.
The stake in the cell tower business retained by Deutsche Telekom of 49.0 percent has been recognized using the equity method since February 1, 2023.
The GD tower company DFMG Deutsche Funkturm GmbH continues to build and operate infrastructure for Deutsche Telekom’s mobile network.
a) Cash outflows for investments in property, plant, and equipment, and intangible assets (excluding goodwill).
b) At reporting date.
Operating segments: development of operations
Operating segments: development of customer numbers in the second quarter of 2024
Comments on the table
a) Sum of all FTTx access lines (e.g., FTTC/VDSL, vectoring, and FTTH/B).
Operating segments: development of customer numbers in year-on-year comparison
Comments on the table
a) Sum of all FTTx access lines (e.g., FTTC/VDSL, vectoring, and FTTH/B).
This media information contains forward-looking statements that reflect the current views of Deutsche Telekom management with respect to future events. They are generally identified by the words “expect,” “anticipate,” “believe,” “intend,” “estimate,” “aim,” “goal,” “plan,” “will,” “seek,” “outlook,” or similar expressions and include generally any information that relates to expectations or targets for revenue, adjusted EBITDA AL, or other performance measures. Forward-looking statements are based on current plans, estimates, and projections, and should therefore be considered with caution. Such statements are subject to risks and uncertainties, most of which are difficult to predict and are generally beyond Deutsche Telekom’s control. They include, for instance, the progress of Deutsche Telekom’s staff-related restructuring measures and the impact of other significant strategic or business initiatives, including acquisitions, dispositions, and business combinations. In addition, movements in exchange rates and interest rates, regulatory rulings, stronger than expected competition, technological change, litigation and regulatory developments, among other factors, may have a material adverse effect on costs and revenue development. If these or other risks and uncertainties materialize, or if the assumptions underlying any of these statements prove incorrect, Deutsche Telekom’s actual results may be materially different from those expressed or implied by such statements. Deutsche Telekom can offer no assurance that its expectations or targets will be achieved. Without prejudice to existing obligations under capital market law, Deutsche Telekom does not assume any obligation to update forward-looking statements to account for new information or future events or anything else. In addition to figures prepared in accordance with IFRS, Deutsche Telekom presents alternative performance measures, e.g., EBITDA, EBITDA AL, adjusted EBITDA, adjusted EBITDA AL, adjusted EBITDA margin AL, core EBITDA, adjusted EBIT, EBIT margin, adjusted net profit/loss, adjusted earnings per share, free cash flow, free cash flow AL, gross debt, and net debt. These measures should be considered in addition to, but not as a substitute for, the information prepared in accordance with IFRS. Alternative performance measures are not subject to IFRS or any other generally accepted accounting principles. Other companies may define these terms in different ways.
About Deutsche Telekom: Deutsche Telekom at a glance
