Deutsche Telekom Raises Earnings Outlook for 2023

Deutsche Telekom, the German telecommunications company, has increased its earnings outlook for 2023 for the third time this year. This decision comes after the company reported a higher quarterly net profit, which can be attributed to lower integration costs resulting from the merger of T-Mobile US and Sprint.

Adjusted Earnings Forecast

Deutsche Telekom now expects adjusted earnings before interest, taxes, depreciation, and amortization after leases to reach approximately €41.1 billion ($44.02 billion) for the full year. This is an increase from their previous forecast of around €41.00 billion. The upward revision reflects the strong performance exhibited during the third quarter.

Strong Cash Flow

The company also expects its free cash flow after leases for the year to exceed €16.1 billion, surpassing their previous guidance by €100 million.

Improved Net Profit

During the third quarter, Deutsche Telekom reported a net profit of €1.92 billion, compared with €1.58 billion from the same period last year. The increase in profit can be attributed to the planned reduction in integration costs in the U.S.

Revenue Insights

While revenue for the quarter decreased from €28.98 billion to €27.56 billion, it still saw a 0.7% rise on an organic basis, excluding foreign-exchange fluctuations. The growth was primarily driven by a 4.1% increase in service revenue.

Meeting Expectations

Deutsche Telekom's adjusted EBITDA after leases came in at €10.49 billion, remaining relatively unchanged year-on-year. Analysts had anticipated an adjusted EBITDA after leases of €10.37 billion and revenue of €27.56 billion, according to consensus estimates provided by the company.