Development of the overall economic environment and the associated impact

The global economy proved remarkably resilient in 2025, despite high political uncertainty and increased trade barriers. It was driven by advanced production and trade flows, high investments in data centers and artificial intelligence (AI), and supportive fiscal policy measures, as well as easing in the monetary policy environment following cuts in key interest rates. Nevertheless, growth in global trade slowed in the reporting year. Labor markets remained robust overall, despite initial signs of slowing.

Uncertainty over the global economic outlook remains high. In particular, ongoing high geopolitical tensions constitute a significant risk factor. Uncertainty in trade policy has risen further in the context of increasing import restrictions in major economies. By contrast, a broad-based revival in private consumption could lead to a moderate economic recovery in the year ahead. In the medium term, progressing digital transformation and more widespread use of artificial intelligence are likely to boost productivity growth. However, the economic outlook remains subject to significant downside risks.

The telecommunications industry has so far proven to be relatively resilient in the face of economic fluctuations.

For further information on the economic trend, please refer to the section “The economic environment” in the combined management report.

Deutsche Telekom is aware that, especially in view of the current developments, extrapolating past experience to the future is only possible to a limited extent. Deutsche Telekom continues to address these challenges and considers them in its business decisions in the course of developing measures to mitigate the risks. For example, interest rate risks are mitigated by means of active interest rate management, whereby each year, a maximum is set for the percentage of variable-interest liabilities, taking into account the planned finance costs. With respect to their energy supply, Deutsche Telekom’s national companies pursue different procurement strategies, e.g., by concluding power purchase agreements, to balance long-term supply reliability and appropriate prices.

For further information on risk mitigation measures, please refer to the section “Risk and opportunity management” in the combined management report.

Deutsche Telekom also considers the development of the economic environment in its consolidated financial statements and financial reporting, e.g., when determining the impairment of goodwill, the recognition of deferred taxes, and the measurement of provisions, financial instruments, and investments accounted for using the equity method.