38 Segment reporting

Deutsche Telekom reports on five operating segments, as well as on the Group Headquarters & Group Services segment. Three operating segments are distinguished by region (Germany, United States, Europe), one by customers and products (Systems Solutions), and another by tasks (Group Development). For three operating segments, business activities are assigned by customer and product (Germany, Systems Solutions, United States), while one operating segment allocates its activities on a regional basis (Europe) and another allocates them by equity investment (Group Development).

The Germany operating segment comprises all fixed-network and mobile business activities for consumers and business customers, including separate sales entities in Germany to allow a customer-centric sales approach. The Wholesale business delivers wholesale telecommunication services for third-party telecommunications companies. Build-out of the mobile and fixed networks in Germany is managed by the Technology business unit.

The United States operating segment combines all mobile activities in the U.S. market. T‑Mobile US offers services, terminal equipment, and accessories for consumers. In addition, the company sells devices to dealers and other third-party distributors for resale. They provide wireless communications and broadband services through a variety of service plan options to U.S. domestic customers, including plans marketed to businesses. T‑Mobile US also offers wireless devices. They also provide products that are complementary to their wireless communications and broadband services, including device protection, financial services and advertising.

The Europe operating segment comprises all fixed-network and mobile operations of the national companies in Greece, Hungary, Poland, the Czech Republic, Croatia, Slovakia, Austria, North Macedonia, and Montenegro. In these countries, Deutsche Telekom is an integrated provider of telecommunications services. Hellenic Telecommunications Organization (OTE) ended its mobile activities in the Romanian market upon completion of the sale of the national company there as of October 1, 2025. Besides the traditional fixed-network and mobile business with residential customers, most of the national companies also offer ICT solutions for business customers.

The Systems Solutions operating segment offers a comprehensive portfolio of B2B ICT services worldwide and in particular in the core market of Germany, as well as in Austria and Switzerland (DACH), under the T‑Systems brand. The business focus is on the central growth areas of advisory, cloud services, and digitalization. Security solutions and networking offers are integral components of its service offering, supported by strategic partnerships. Our services penetrate deep into the value chains of selected industries – in particular automotive, healthcare, and the public sector.

The goal of the Group Development segment is to actively manage entities and equity investments to grow their value. The investment management group DTCP; Comfortcharge, which is a provider of e-mobility charging infrastructure; and the Group functions of Mergers & Acquisitions and strategic Portfolio Management are also assigned to Group Development.

The Group Headquarters & Group Services segment comprises all Group units that cannot be allocated directly to one of the operating segments, as well as the Board of Management department for Product and Technology. Group Headquarters defines strategic aims for the Group, ensures they are met, and becomes directly involved in selected Group projects. Group Services provides services to the entire Group; in addition to typical services provided by Deutsche Telekom Services Europe, such as financial accounting, human resources services, and operational procurement, Group Services also includes the placement services of personnel services provider Vivento. Further units are Group Supply Services (GSUS) for real estate management and strategic procurement, and MobilitySolutions, which is a full-service provider for fleet management and mobility services.

Changes to the segment and organizational structure in 2025

Deutsche Telekom consummated material business combinations in the reporting year. In the United States operating segment, the DOOH providers Vistar Media and Blis were acquired, as well as the wireless operations and selected spectrum licenses of UScellular, which have since been fully consolidated and included in Deutsche Telekom’s consolidated financial statements. The equity investments acquired in the Lumos and Metronet FTTH platforms in the United States operating segment are included in the consolidated financial statements using the equity method. In the Europe operating segment, Telekom Romania Mobile Communications was sold.

For further information on the corporate transactions consummated in the reporting year, please refer to the section “Changes in the composition of the Group and other transactions” under “Summary of accounting policies.”

The business segments are reviewed at regular intervals by the Deutsche Telekom Board of Management in terms of the allocation of resources and their earnings performance.

The measurement principles for Deutsche Telekom’s segment reporting structure are based primarily on the IFRSs adopted in the consolidated financial statements. Deutsche Telekom evaluates the segments’ performance based on revenue and profit/loss from operations (EBIT), among other factors. Revenue generated and goods and services exchanged between segments are calculated on the basis of market prices. Services provided by Deutsche Telekom IT are generally charged at cost. Development services are not charged, but capitalized at segment level in accordance with the internal control concept. In accordance with the segments’ control concept, intragroup leases are not capitalized by the lessee, but instead recognized as periodic expenses. In accordance with the Company’s principles of segment management, when loans with embedded derivatives are granted internally to Group entities, the derivative component is recognized separately also in the creditor company’s financial statements and measured at fair value through profit or loss. Segment assets and liabilities include all assets and liabilities that are carried in the financial statements prepared by the segments and included in the consolidated financial statements. Segment investments include additions to intangible assets, property, plant and equipment, and right-of-use assets. Where entities accounted for using the equity method are directly allocable to a segment, their shares of profit or loss after income taxes and their carrying amounts are reported in that segment’s accounts. All of the performance indicators shown in the following tables are presented exclusively from the segments’ perspective: The effects of intersegment transactions are eliminated and presented in aggregate form in the reconciliation line.

The following table shows the performance indicators (revenue, EBIT) used by Deutsche Telekom to evaluate the operating segments’ performance as well as additional segment-related indicators (goods and services purchased, personnel costs, depreciation and amortization, impairment losses, interest income, interest expense):

Information on geographic areas

The Group’s non-current assets and net revenue are shown by region: Germany, Europe (excluding Germany), North America, and other countries. The North America region comprises the United States and Canada. The Europe (excluding Germany) region covers the entire European Union (excluding Germany) and the other countries in Europe. Other countries include all countries that are not Germany or in Europe (excluding Germany) or North America. Non-current assets are allocated to the regions according to the location of the assets in question. Non-current assets encompass intangible assets; property, plant and equipment; right-of-use assets; capitalized contract costs; investments accounted for using the equity method; as well as other non-current assets. Net revenue is allocated according to the location of the respective customers’ operations.

For information on products and services, please refer to Note 20 “Net revenue.”