27 Depreciation, amortization and impairment losses
The following table provides a breakdown of depreciation, amortization and impairment losses:
millions of € |
|
|
|
|---|---|---|---|
|
2023 |
2022 |
2021 |
Amortization and impairment of intangible assets |
6,580 |
6,931 |
6,621 |
Of which: impairment losses |
101 |
180 |
155 |
Of which: impairment losses on mobile licenses |
4 |
19 |
4 |
Of which: amortization of mobile licenses |
554 |
559 |
606 |
Depreciation and impairment of property, plant and equipment |
11,954 |
13,603 |
14,498 |
Of which: impairment losses |
110 |
668 |
92 |
Depreciation and impairment of right-of-use assets |
5,441 |
7,102 |
5,972 |
Of which: impairment losses |
10 |
308 |
37 |
|
23,975 |
27,635 |
27,091 |
Impairment losses break down as follows:
millions of € |
|
|
|
||||
|---|---|---|---|---|---|---|---|
|
2023 |
2022 |
2021 |
||||
Intangible assets |
101 |
180 |
155 |
||||
Of which: in connection with the ad hoc impairment tests of assets of the fiber-optic-based fixed network in the United Statesa |
0 |
27 |
0 |
||||
Of which: in connection with the ad hoc impairment test in the Systems Solutions cash-generating unitb |
96 |
119 |
140 |
||||
Of which: in connection with the ad hoc impairment test in the Romania cash-generating unit |
0 |
32 |
0 |
||||
Property, plant and equipment |
110 |
668 |
92 |
||||
Of which: in connection with the ad hoc impairment tests of assets of the fiber-optic-based fixed network in the United Statesa |
28 |
528 |
0 |
||||
Of which: in connection with the ad hoc impairment test in the Systems Solutions cash-generating unit |
54 |
24 |
60 |
||||
Of which: in connection with the ad hoc impairment test in the Romania cash-generating unit |
0 |
85 |
0 |
||||
Right-of-use assets |
10 |
308 |
37 |
||||
Of which: in connection with the ad hoc impairment tests of assets of the fiber-optic-based fixed network in the United Statesa |
8 |
272 |
0 |
||||
|
221 |
1,156 |
284 |
||||
|
|||||||
Depreciation, amortization and impairment losses on intangible assets, property, plant and equipment, and right-of-use assets decreased by EUR 3.7 billion year-on-year to EUR 24.0 billion, with the decrease being mainly attributable to the United States operating segment.
Depreciation and amortization decreased by EUR 2.7 billion to EUR 23.8 billion, with the decrease being mainly attributable to the United States operating segment. Depreciation and amortization at T‑Mobile US were lower due to the ongoing strategic withdrawal from the terminal equipment lease business. Depreciation and amortization also decreased due to the complete write-off of certain 4G network components, including assets affected by the decommissioning of the former Sprint’s legacy CDMA and LTE networks in 2022. The decrease was offset by increased depreciation and amortization in connection with the further build-out of the nationwide 5G network in the United States. In addition, a further reduction in the useful life of leased network technology for cell sites following the business combination of T‑Mobile US and Sprint increased depreciation of the corresponding right-of-use assets by EUR 0.2 billion. In the Germany operating segment, depreciation and amortization increased, partly as a result of the sale and leaseback of passive network infrastructure in Germany and Austria in connection with the sale of the GD tower companies and the associated recognition of retained right-of-use assets.
The impairment losses recognized in the reporting year amounted to EUR 0.2 billion and largely related to the Systems Solutions operating segment and the Group Headquarters & Group Services segment. These related to follow-up investments in connection with assets previously impaired in the 2020, 2021, and 2022 financial years. Furthermore, despite the business outlook remaining positive, the increase in the cost of capital in the reporting year prompted further impairment losses to be recognized on non-current assets at the end of 2023. The impairment losses recorded in the prior-year period of EUR 1.2 billion were mainly attributable to the former Sprint’s fiber-optic-based wireline assets in the United States operating segment (EUR 0.9 billion). These impairment losses arose in part in connection with the sale of the business agreed in September 2022. Other impairment losses in the prior year related to the Systems Solutions operating segment and Group Headquarters & Group Services segment (EUR 0.1 billion), and to the Europe operating segment (EUR 0.1 billion).
For further information, please refer to Notes 6 “Intangible assets,” 7 “Property, plant and equipment,” and 8 “Right-of-use assets – lessee relationships.”