Deutsche Telekom's 2024 Earnings: A Year of Growth and Record Dividend

In the world of telecommunications, Deutsche Telekom (ETR:DTE) has just released its full-year 2024 earnings, and the news is nothing short of impressive. The company's strategic focus on fiber optic networks has paid off, driving strong financial performance and setting the stage for further growth. Let's dive into the key takeaways from Deutsche Telekom's 2024 earnings report.

Revenue and Earnings Growth

Deutsche Telekom's total revenue increased by 3.4 percent compared with the prior year to 115.8 billion euros. Service revenues grew by 3.9 percent to 96.5 billion euros, while adjusted EBITDA AL grew by 6.2 percent to 43.0 billion euros. Free cash flow AL was up 18.7 percent to 19.2 billion euros, and adjusted net profit increased by 18.3 percent in 2024 to 9.4 billion euros. These impressive results demonstrate the company's ability to grow across all business areas, as CEO Tim Höttges noted.



Record Dividend and Share Buy-Back Program

For the financial year just ended, the Group plans to distribute a dividend of 0.90 euros per share, which will be the highest dividend payment in Deutsche Telekom’s history. This is subject to approval by the relevant bodies. Additionally, Deutsche Telekom plans up to 2 billion euros in share buy-backs in 2025. These initiatives show the company's commitment to returning value to shareholders and maintaining a strong financial position.

Fiber Optic Network Growth

Deutsche Telekom's fiber-optic network is gaining in popularity, with more than 10 million households now able to subscribe to a fiber rate plan. The gigabit network already has a customer base of almost 1.5 million, with 472,000 new customers added in the year just ended, a 61 percent increase from 2023. The total number of net broadband additions in 2024 was 134,000, and the TV customer base grew by 311,000. This strong growth in fiber use has contributed to positive trends in the company's most important financial performance indicators.

T-Mobile US' Strong Customer Growth

T-Mobile US, in which Deutsche Telekom holds a 51.5 percent stake, continued its industry-leading growth in 2024. Service revenues amounted to 66.1 billion U.S. dollars, up 4.5 percent against 2023. At the same time, adjusted EBITDA AL increased by 8.1 percent to 30.9 billion U.S. dollars. This solid financial performance was driven by unabated strong customer growth, with T-Mobile US reporting 6.1 million new postpaid mobile customers, including 3.1 million phone customers. For 2025, T-Mobile US expects further strong growth in postpaid mobile customers of 5.5 to 6.0 million.

Guidance for 2025

Deutsche Telekom expects adjusted EBITDA AL for the 2025 financial year of approximately 44.9 billion euros, an increase of around 4.5 percent against 2024. Adjusted free cash flow AL is expected to increase by around 4.0 percent to around 19.9 billion euros, and adjusted earnings per share is expected to increase by around 9.0 percent to around 2.00 euros. These targets align with the ambitions communicated at the Capital Markets Day in October, indicating a positive outlook for the company's future growth.

In conclusion, Deutsche Telekom's 2024 earnings report showcases a year of strong growth, driven by the company's strategic focus on fiber optic networks and the continued success of T-Mobile US. With a record dividend and share buy-back program, Deutsche Telekom is well-positioned to continue its growth trajectory in 2025 and beyond. As an investor, keeping an eye on Deutsche Telekom's progress and considering its attractive dividend yield and growth prospects can be a wise move in the ever-evolving telecommunications landscape.