Victory Lap for Deutsche Telekom: Bumping Up Annual Targets Due to Unstoppable U.S. Growth
Expanding client base and robust U.S. operations propel Deutsche Telekom to elevate annual performance goals - Rising Customer Base and Profitable U.S. Operations Prompt Telekom to Amend Yearly Goals
Hey there,
Good news, folks! The cream of the crop in telecommunications, Deutsche Telekom, has marked a significant 43.5% year-on-year boost in consolidated net income during January to March, hitting a whopping 2.8 billion euros. Even morphing the numbers to exclude special effects, the growth persisted at a robust 9.1%. Kudos to CEO Tim Höttges for pointing out the company's tenacity amidst challenging conditions, right?
Here's the kicker: Two-thirds of the revenue for Deutsche Telekom hails from the U.S.A! It's subsidiary, T-Mobile, has bagged an impressive 1.3 million new customers in the first quarter alone. That's a substantial rise, pushing the total count to a staggering 131 million customers—10 million more than last year.
In the heart of Germany, mobile customer count saw an increase of 274,000 in the first quarter. Also worth celebrating, the number of those hooked onto pure fiber optic connections in the fixed network went up by 128,000 to 1.6 million. Progress, baby! The operating profit in Germany climbed by 2.3% compared to last year.
Deutsche Telekom, feeling the surge of success, is now upping the ante for its annual financial targets in 2025. After heralding robust mobile customer demand in the U.S., T-Mobile USA is gazing at postpaid net additions of 1,337,000 in Q1 2025—an impressive increase from 1,220,000 in Q1 2024. [1] As a result, Deutsche Telekom is resetting its expectations for adjusted EBITDA AL to approximately €45.0 billion, a delightful 4.5% growth on a pro-forma basis compared to 2024. [1][3][4] The free cash flow is also gearing up to increase to around €20.0 billion, compared to earlier estimates of €19.9 billion. [3]
To sum it up, Deutsche Telekom's revised financial forecasts for 2025 have swelled thanks to strong mobile net additions, particularly at T-Mobile USA, resulting in a slight but meaningful increase in its annual guidance for operating profit and cash flow. [1][3] In layman's terms, the crazy customer growth at T-Mobile USA is the undisputed hero behind Deutsche Telekom's decision to crank up its annual targets.
In light of Deutsche Telekom's impressive growth in the United States, particularly with T-Mobile USA, the company is considering the implementation of a community policy that focuses on providing vocational training programs for its employees in the business sector. This move is aimed at enhancing the overall efficiency and productivity of the company, contributing to the achievement of its expected adjusted EBITDA AL of approximately €45.0 billion in 2025. The increased revenue and financial targets are largely attributed to the substantial growth in the number of customers, with T-Mobile USA expecting to add 1,337,000 postpaid net additions in Q1 2025, a significant increase from the previous year.
