By Marleen Kaesebier and Maria Rugamer (Reuters) -Deutsche Telekom lifted its full year profit outlook and raised its dividend on Thursday as it reported third quarter earnings in line with market
Deutsche Telekom Upgrades Profit Forecast and Dividend Announcement
Deutsche Telekom's Financial Performance and Future Plans
By Marleen Kaesebier and Maria Rugamer
Profit and Dividend Adjustments
(Reuters) -Deutsche Telekom lifted its full year profit outlook and raised its dividend on Thursday as it reported third quarter earnings in line with market expectations.
Impact of U.S. Market Trends
The Germany-based telecoms giant reported third quarter adjusted earnings before interest, taxes and amortization after leases (EBITDA AL) of 11.1 billion euros ($13.0 billion), broadly in line with the 11.1 billion euros expected by analysts in a company provided poll.
AI Initiatives and Investments
The group now expects core profit of around 45.3 billion euros for the year and free cash flow after leases of around 20.1 billion euros. It had previously guided for 45 billion euros and more than 20 billion euros, respectively.
Quarterly Earnings Breakdown
Deutsche Telekom also aims to raise its dividend from 90 cents per share to 1 euro per share.
Telekom said that its new guidance was largely due to positive trends in the U.S. and the consolidation of UScellular, which it purchased for $4.4 billion at the beginning of August.
T-mobile, its New York listed subsidiary, had said in September that it expects a $400 million service revenue boost in the third quarter from the deal.
Earlier in November Deutsche Telekom and Nvidia said they were launching an AI cloud in a 1 billion euro ($1.2 billion) partnership for 2026.
The German company is betting big on AI, aiming also to build one of the EU's AI "gigafactories" in North Rhine-Westphalia in partnership with Nvidia.
If the first goes well, Deutsche Telekom would be willing to "double down" on these investments, chief executive Tim Hoettges had said.
The firm's IT service provider unit, T-Systems, saw a 23.7% increase in quarterly core profit from the year prior boosted by cloud business.
The company's quarterly reported net profit however fell by 17.9% year-on-year to 2.43 billion euros.
($1 = 0.8575 euros)
(Reporting by Marleen Kaesebier and Maria Rugamer in Gdansk, Editing by Matt Scuffham)
