Since 2021, our Group strategy has been determined by our vision of becoming the Leading Digital Telco by 2030. Because few if any industries face change on the same scale as the telecommunications industry. Digitalization is the central catalyst for the key trends in this regard, from increasing volumes of data traffic and the attendant demand for high-performing, secure networks, to highly individualized and context-sensitive digital products and services with immediate availability through self-service and cloud-based as-a-service models. We are seeing companies from other industries pushing onto the market with lean, software-defined production models. Providers such as Google, Microsoft, and Amazon Web Services offer B2B connectivity solutions and are increasingly providing network functions in their cloud environments. CPaaS (communications platform as a service) companies offer user-friendly communications services on their own communications platforms – without having their own networks. They provide developers and business customers with standard telecommunications services (calls, text messages) and new network functions through standardized application programming interfaces (APIs). This shifts access to end customers from telecommunications providers to the CPaaS companies and big tech companies.
We at Deutsche Telekom take up digitalization as the primary driver of significant changes in our ecosystem and correspondingly also in our strategic alignment. For us, this means continuing to invest in our networks and making digital participation possible for all. Because building and operating convergent networks remains the core of our strategy. But it also means continuing to digitalize. Whether it involves our products and services, market approach, production, or processes, we ourselves must also become more digital. Only if we are digitalized in all areas, can the success of the last few years continue. The result will be a Deutsche Telekom that can adapt faster and more flexibly to changing market conditions. We reported comprehensively on the further development of our strategy at our Capital Markets Day in October 2024.
We are already well positioned to reach our goals on our journey to realizing our Leading Digital Telco vision: our key performance indicators at the end of the 2024 financial year confirm that Deutsche Telekom remains Europe’s leading telecommunications company. No other telecommunications company has a comparable footprint with its own networks in Europe and the United States. We see ourselves as a global enterprise with a considerable presence in Europe, European roots and values, and an extremely strong business in the United States. However, our Group strategy does not aim to micromanage all local units, but to provide a strategic framework and to utilize local strengths such as networks and competitive standing. Our T‑Mobile US business in the United States in particular has operated under this decentralized approach for many years enjoying considerable success with its Un-carrier initiatives. Because our Group-wide strategic goals are clear: we want to align ourselves long-term with the needs of our customers and transform ourselves into a digital company, leveraging the synergies within our Group, to hold our own against new competitors and continue our growth course.
Our growth ambitions and success metrics measured using key performance indicators remain unchanged. The success of our strategy can be seen in our long-term competitiveness and as such is reflected in the established key financial figures: we had set an annual growth target (Group CAGR) of 1 to 2 % for revenue and 3 to 5 % for adjusted EBITDA AL for the years 2021 through 2024. We have achieved these targets and announced new targets through 2027 at our 2024 Capital Markets Day.
For further information on our financial ambition levels through 2027, please refer to the section “Finance strategy.”
We are different – superior brand, unique portfolio, best team, strong values, and leading ESG ambitions
Our brand
“Connecting your world” – that is our slogan and at the same time our claim. It sums up Deutsche Telekom’s brand promise in a nutshell. We give our customers access to the diverse possibilities of this world. As a trustworthy partner, we accompany them on this journey – and also ensure that no one is left behind. This is what the Telekom brand stands for.
Global Telco Brand
#1
+84 % brand value since 2020
Our employees
We are passionate, diverse, and act responsibly. We want to be leading in everything we do, so that the leading parts become a leading whole. Customer satisfaction and outstanding quality are the best investments for this. We count on global strength, while being deeply rooted in the local communities in which we operate. This is how we grow. This is how we gain momentum for the future.
83%
of our employees are proud of our brand
Our responsibility
Our societal responsibility forms the basis for our corporate actions. We want to achieve net zero in our direct operations by 2025 and along our entire value chain by 2040. We are committed to digital participation, privacy, and security as well as respectful behavior online based on democratic rules.
The volume of emissions we intend to be responsible for is:
ZERO
None at all! No small print. And we want to achieve this target by 2040.
Data & AI
Become a data-informed, AI-enabled digital-first company
Customer satisfaction
We accelerate our flywheel, by doubling down on Data and AI: customer interfaces, networks, IT, and processes – we are digitalizing everything, end to end. Combining operational data and customer satisfaction data helps us to better understand customer behavior, and to proactively address issues to improve customer satisfaction.
Machine-learning network operations
correlate customer and network data to predict and improve customer satisfaction
Best offer
The digitalization of our core business is helping us to improve customer experience. We use data analytics and machine learning to determine the most relevant product or service to offer to our customers at the right time.
Customer data analyses
…enable offers tailored automatically to customer needs
Artificial Intelligence
We are systematically expanding our expertise in innovative technologies like artificial intelligence for the sake of our digital transformation. Data-based analyses are already helping us to maintain our hardware more proactively, understand customer needs better, and manage our networks more efficiently.
We are investing in...
and automation for better customer experience and efficiency
AI for efficiency
We want to to make the best possible use of the advantages of AI along our value chain. For instance, AI will enable us to individually adapt each mobile radio cell to expected workload levels. It will anticipate spikes in local utilization rates, e.g., if there’s an open-air concert, and increase the antenna capacity as required. Likewise, it can put certain frequencies into sleep mode during periods of expected low demand, e.g., at night.
Optimize
by tailoring network settings to real-time customer usage data
Investments
Differentiate via leading network experience – best fiber, best 5G
Cash capex
We invest – above all in the best networks. Customers should have the best network experience anytime, anywhere, whether on fixed or mobile networks, or with alternative access technologies. Fiber to the home in the fixed network and 5G in mobile communications are particularly important for this.
In 2024 we invested
~ EUR16billion
first and foremost into building and operating networks
Fiber Germany
We leverage the fiber rollout to create long term profitability. We keep the pace for our fiber build-out activities and aim to pass 2.5 million households per year with optical fiber in Germany.
Fiber:
17.5million
homes passed in Germany until 2027
Fiber Europe
In our European countries we follow two different approaches aligned with our actual position: Where we are incumbent we aim for more than 1 million households per year. In countries where we are fixed challengers, we will build on fiber partnerships.
Fiber:
13.5million
homes passed in our EU footprint until 2027
Fiber US
We also want to expand our offering in the United States to include a broadband fixed network. To this end, T-Mobile US is using its leading position in terms of mobile spectrum to offer customers 5G broadband via fixed wireless access. On top, T-Mobile US aims to reach 12 to 15 million households with fiber optics by 2030, leveraging collaborations and joint ventures.
Fiber:
12–15million
homes passed in the US until 2030
5G in Germany and US
With 5G, we have created the best Deutsche Telekom mobile network of all time. With even greater performance and speed, it offers entirely new opportunities since the high bandwidths guarantee more stability and capacity. This allows our customers to enjoy video chats, streaming, and online shopping without any jerkiness or buffering.
~98%
5G coverage in Germany and in the US (2024)
5G in Europe
With 5G, we have created the best Deutsche Telekom mobile network of all time. With even greater performance and speed, it offers entirely new opportunities since the high bandwidths guarantee more stability and capacity. This allows our customers to enjoy video chats, streaming, and online shopping without any jerkiness or buffering.
~78%
5G coverage in our EU footprint (2024)
Customers
Grow by monetizing high-quality networks and services that enhance digital life and business with Magenta Advantage
Customers worldwide
Our networks and products convince with quality. This is how we continuously win new customers. With our products, we support both private and business customers in their “digital lives and work.”
We serve more than
300million
customers worldwide
Turn customers into fans
With additional offers such as in our OneApp, we offer our customers further advantages, turning them into fans. This is how we will continue to grow in the consumer and business customer segments in the future and tap into new revenue sources through our Magenta Advantage.
Turn customers into fans
Magenta Advantage
Our customers benefit from the “Magenta Advantage”: They get access to exclusive offers via our channels. Our partners can bring their new services to a wider audience more quickly too. This means we continue improving loyalty among our customers while getting a cut of our partners’ revenue.
When all three of these come together...
...everyone is happy.
Strong position in B2B
We have a unique starting position in B2B: We leverage our global B2B footprint and use T-Systems as differentiator to accelerate our growth. Close collaboration across all units is the foundation for future shared success in B2B.
Global B2B expertise
By pooling our resources and combining individual strengths, we can address every aspect of our customers’ digital transformation needs – from sovereign cloud solutions and AI innovations to secure connectivity and IoT offerings.
Unique global B2B setup with
>40,000
employees covering all relevant B2B needs
Revenue growth B2B
We continue to transform. Portfolio and structure, process/channel digitalization and automation. Cross-segment collaboration, data insights and AI take us to the next level. Our goal is to grow in service revenues while increasing our profitability.
B2B service revenue
~5%
CAGR 2023–2027
Efficiencies
Increase productivity and cost efficiency end-to-end through continuous automation, simplification, and modernization
EBITDA AL
The large number of customers allows us to make full use of our networks and achieve economies of scale also in other areas of the company. On top we will increase our productivity and cost efficiency end-to-end through continuous automation, simplification, and modernization.
Adjusted EBITDA AL
+4–6%per year
CAGR 2023–2027
Cost efficiency
The digital transformation is key to further enhancing cost efficiency throughout our entire value chain: from the customer interface to our production processes, through to the management of our own infrastructure and supply chains.
Reduce share of indirect costs over service revenues
by3–5percentage points
until 2027 (Deutsche Telekom excluding T-Mobile US)
Financials
Maximize capital returns to re-invest in sustainable growth and deliver superior shareholder value
Revenues
We are committed to continue our growth path: in revenues as well as in EBITDA AL – on both sides of the Atlantic.
Net revenue
~4%
CAGR 2023–2027
Cash flow
As a result of our strategy, we achieve solid financial results. These results put us in a position to reward our shareholders on one hand and on the other hand to make further investments. This, in turn, keeps our flywheel spinning.
Free cash flow AL
~ EUR21billion
in 2027
Earnings per share
We will also use potential surplus funds for further EPS accretion, including from T-Mobile US stake increases and own share buy-backs.
Adjusted earnings per share
~ EUR2.50
in 2027
Global scale
Scale-up with global services, cloudified API-based NT/IT platforms, and common operations
API
We accelerate our flywheel, by utilizing our global scale: We create an ecosystem that other companies can easily connect to. Connectivity, services, and data (e.g., location data, connection conditions, and user behavior) can also be accessed by third parties (e.g., service providers and app developers) via APIs and can thus be integrated into new applications – similar to the app store principle.
Standard interfaces
for selected network functions
Common operations
We accelerate our flywheel, by the utilizing our global scale: We will leverage global platforms, scale common products and best practices as well as implement a common network operation model in our European footprint.
Future network operations
designed along technology platforms driving harmonization
Centers of excellence
We accelerate our flywheel, by the utilizing our global scale: We intensify collaboration across all our markets. In B2B we use centers of excellence for more innovation and better customer experience. This way we leverage and build on unique capabilities from one country for the benefit of all.
Centers of excellence – B2B
Flywheel: Leading Digital Telco vision
At the center of our strategy is the flywheel. It describes the effect mechanisms of our strategic priorities in our key areas of operation:
Investments: We invest – above all in our networks. These are the basis for delivering our products and services to customers.
Customers: We continuously win new customers with our product and service portfolio. Worldwide, we have over 261 millionmobile customers, alongside further fixed-network and TV customers.
Efficiencies: The large number of customers allows us to make full use of our networks and achieve economies of scale also in other areas of the Company. For example, when we develop certain platforms for all customers worldwide, rather than in individual markets. This gives us an efficiency advantage. We are also improving efficiency in our standard processes through digitalization and other measures.
Financials: As a result, we achieve solid financial results. These results put us in a position to make further investments. This keeps our flywheel spinning.
We are set to accelerate this flywheel with the planned addition of two further areas of operation:
We are driving forward the digital transformation of our Company and want to leverage the potential offered by our data and by AI better than ever going forward. This applies both to internal processes, so as to further enhance quality and efficiency, and to specific offerings for our customers.
At the same time, we are leveraging our global scale with plans to capitalize on more economies of scale in the future, such as synergies through shared platforms, products, and workflows.
In the following, we describe the areas of operation of our strategy and the results achieved in the 2024 financial year.
AL – After Leases
Since the start of the 2019 financial year, we have taken the effects of the first-time application of IFRS 16 “Leases” into account when determining our financial performance indicators. “EBITDA after leases” (EBITDA AL) is calculated by adjusting EBITDA for depreciation of the right-of-use assets and for interest expenses on recognized lease liabilities. When determining “free cash flow after leases” (free cash flow AL), free cash flow is adjusted for the repayment of lease liabilities.
In the combined management report, one mobile communications card corresponds to one customer. The totals were calculated on the basis of precise figures and rounded to millions or thousands. Percentages were calculated on the basis of the figures shown (see also SIM card).
