Germany

Customer development

Total

In Germany we continue to be market leader both in terms of fixed-network and mobile revenues. This success is attributable to our high-performance networks, a broad product portfolio, and good service. We want to offer our customers a seamless and technology-neutral telecommunications experience. We regularly adapt our product portfolio to address the needs of our customers.

The fixed-network broadband market hosts a large number of players with differing infrastructures – from national through to regional providers. In order to consolidate our position on the market as Germany’s leading telecommunications provider, we continue to add new offerings to our portfolio.

Mobile communications

The number of high-value mobile contract customers under the Telekom and congstar brands grew by 919 thousand customers overall against December 31, 2023. Sustained high demand for mobile rate plans with data volumes continues to drive this trend. The number of prepaid customers grew by 4.5 million against the start of 2024, primarily due to M2M SIM cards used in the automotive industry.

Fixed network

Demand remained high for our fiber-optic-based lines, with the total number increasing to 20.7 million since the end of 2023. This strong growth is driven by demand for higher bandwidths.

The number of retail broadband lines remained at a high level, increasing to 15.1 million compared with December 31, 2023. Around 49 % of the customers have subscribed to a rate plan with speeds of 100 Mbit/s or higher. We recorded an increase of 263 thousand in the number of TV customers compared with year-end 2023. The number of fixed-network lines stood at 17.2 million.

Wholesale

As of September 30, 2024, fiber-optic-based lines accounted for 71.6 % of all lines – 4.2 percentage points more than at the end of 2023. This growth is a result of the demand for our commitment agreements. Ongoing demand among retail customers for higher-bandwidth lines also contributed to the increase. The number of unbundled local loop lines decreased by 507 thousand compared with the end of the prior year, while fiber-optic-based lines increased by 262 thousand. These developments result partly from the shift to higher-value fiber-optic-based lines and partly from consumers switching to other providers. In addition, our wholesale partners are migrating their retail customers to their own infrastructures. The total number of wholesale lines at the end of September 2024 was 10.6 million.

Development of operations

Revenue, service revenue

In the first nine months of 2024, we generated revenue of EUR 19.1 billion, which was up by 2.9 % year-on-year. This was mainly attributable to growth in service revenues of 2.0 %, due to increased revenue in the fixed-network core business, largely driven by broadband and IT business, and in the mobile business. Another revenue driver was the 9.4 % increase in non-service revenues, including from mobile terminal equipment revenues.

Revenue from Consumers increased by 5.7 % compared with the prior-year period. Revenue from broadband business continued to grow, due in part to the positive effects from customer appreciation for reliable networks and high bandwidths. Volume-driven declines in revenue from voice components continued to impact on fixed-network business. The mobile business increased due to higher service revenues, mainly as a result of positive customer development.

Revenue from Business Customers was down 5.2 % against the prior-year period, primarily due to certain revenues being recognized under Wholesale since January 1, 2024. In organic terms, revenue was up 0.7 % against the prior-year level, due in part to the positive trends in IT business and mobile service revenue, with the latter driven mainly by sustained growth in the customer base.

Wholesale revenue was up at the end of September 2024 by 20.3 % year-on-year as a result of the change in disclosure of revenues described under Business Customers. On an organic basis, revenue was 0.8 % higher than in the prior-year period.

Adjusted EBITDA AL, EBITDA AL

Adjusted EBITDA AL increased by EUR 0.2 billion or 2.7 % year-on-year. The main reasons for this increase are a sound operational development, driven by high-value revenue growth, and enhanced cost efficiency, primarily as a result of the lower headcount and the ongoing implementation of efficiency enhancement and digitalization measures. This trend was negatively affected by one-time effects, in particular the premium to compensate for inflation under the scope of the collective agreement. Our adjusted EBITDA AL margin amounted to 41.1 %.

At EUR 6.9 billion, EBITDA AL was below the level of the prior-year period. The effects described with regard to adjusted EBITDA AL included special factors in the amount of EUR 0.9 billion comprising, for example, the forgone contingent consideration receivable from IFM Global Infrastructure Fund, and socially responsible staff restructuring.

Profit/loss from operations (EBIT)

Profit from operations amounted to EUR 4.1 billion, a decrease of 8.4 % against the prior-year period. In addition to the issues mentioned under EBITDA AL, which had a negative effect on EBITDA, EBIT was also affected by higher depreciation, amortization and impairment losses year-on-year, which were partly attributable to the sale and leaseback of passive network infrastructure in Germany in connection with the sale of GD Towers.

Cash capex (before spectrum investment), cash capex

Cash capex increased by EUR 194 million or 5.6 % compared with the prior-year period. Capital expenditure totaled around EUR 3.6 billion in the first nine months of 2024, in particular for the fiber-optic build-out. The number of households passed by our fiber-optic network had increased to 9.3 million by the end of September 2024. In mobile communications, 97.5 % of German households can already use 5G.