Q2 2026 Deutsche Telekom AG Earnings Call

August 6, 2026

Speaker #1: Good afternoon, everyone, and welcome to Deutsche Telekom's Q2 2026 conference call. Joining me today are our CEO, Tim Höttges, and our CFO, Christian Illek.

Hannes Wittig: Good afternoon, everyone, and welcome to Deutsche Telekom's Q2 2026 conference call. Joining me today are our CEO, Tim Höttges, and our CFO, Christian Illek. Tim will begin with an overview, followed by Christian, who will take you through our quarterly performance and group financials in greater detail. After this, we have time for Q&A. Before handing over to Tim, please take note of the usual disclaimer included in our presentation and shown here. Also, please be aware that this conference will be recorded and uploaded to the Internet. Now it's my pleasure to hand over to Tim.

Speaker #1: Tim will begin with an overview: followed by Christian, who will take you through our quarterly performance and group financials in greater detail. After this, we have time for Q&A.

Speaker #1: Before handing over to Tim, please take note of the usual disclaimer, which is included in our presentation and shown here. Also, please be aware that this conference will be recorded and uploaded to the internet.

Speaker #1: And now it's my pleasure to hand over to Tim.

Speaker #2: Yeah, thank quickly start with a snapshot on the results. Our group organic sales revenue is growing by 3.9% in the first 6 months, organic EBITDA is growing by 7.4%, adjusted EPS is growing by 10.3%, customer growth in all our markets, so it's broad development which we have across the group.

Tim Höttges: Thank you, Hannes, and welcome everybody here today. I'm happy to present another set of strong results, and a material step up in our returns to shareholders. Let me quickly start with a snapshot on the results. Our group organic service revenue is growing by 3.9% in H1. Organic EBITDA is growing by 7.4%. Adjusted EPS is growing by 10.3%. Customer growth remains strong and peer leading in all our markets. It's a broad development, which we have across the group. We raise our group free cash flow guidance today to reflect T-Mobile's guidance increase you have seen. We have clear line of sight for our capital markets growth targets, we all in a very positive mood here. Clearly, while we are delivering, there has been significant volatility for our shares.

Speaker #2: Thank you, Hannes, and welcome everybody here today. I am happy to present another set of strong results and a material step-up in our returns to shareholders.

Tim Höttges: Customer growth remains strong and peer leading in all our markets. It's a broad development, which we have across the group. We raise our group free cash flow guidance today to reflect T-Mobile's guidance increase you have seen. We have clear line of sight for our capital markets growth targets, we all in a very positive mood here. Clearly, while we are delivering, there has been significant volatility for our shares.

Speaker #2: And we raised our group free cash flow guidance today to reflect T-Mobile's guidance increase you have seen. We have clear line of sight for our capital markets growth targets.

Speaker #2: And we are all in a very positive mood here. But clearly, while we remain strong and peer-leading in delivering, there has been significant volatility for our shares.

Speaker #2: And I want to address some of this volatility in my prepared remarks today. I will not go through my usual charts today—they should be modestly self-explanatory. Instead, I will go through the four segments before coming to our capital allocation.

Tim Höttges: I want to address some of this volatility in my prepared remarks today. I will not go through my usual charts today. They should be modestly self-explanatory. Instead, I will go through the four segments before coming to our capital allocation. The common thread for this are three themes. The first, we deliver strong and reliable growth. Second, we invest in our future profitability. Third, we allocate capital to grow our value per share. Let me start with T-Mobile. T-Mobile remains the clear growth leader in the US. Organic EBITDA growth based on IFRS was 9.6% in H1 of this year. T-Mobile added half a million accounts in H1, well on track for its full-year target. T-Mobile has established network leadership based on its superior spectrum position. This translates into ARPA opportunities. T-Mobile's ARPA growth is peer leading.

Speaker #2: The common thread for this is three themes. First, we deliver strong and reliable future profitability. Third, we allocate capital to grow our value per share.

Speaker #2: growth. Let me start with T-Mobile. T-Mobile remains the clear growth leader in Second: we invest the US, organic EBITDA growth based on IFRS was 9.6%, is in the first half of this year.

Tim Höttges: T-Mobile remains the clear growth leader in the US. Organic EBITDA growth based on IFRS was 9.6% in H1 of this year. T-Mobile added half a million accounts in H1, well on track for its full-year target. T-Mobile has established network leadership based on its superior spectrum position. This translates into ARPA opportunities. T-Mobile's ARPA growth is peer leading.

Speaker #2: T-Mobile added half a million accounts in the first 6 months, well on track for its full-year target. And T-Mobile has established network leadership based on its superior spectrum position, and this translates into ARPA opportunities.

Speaker #2: T-Mobile's ARPA growth is peer-leading, at the same time postpaid phone churns has come down to 0.85 last quarter. Our focus is on quality, on quality growth, and you can see that in our numbers, our strategy is paying off.

Tim Höttges: At the same time, postpaid phone churn has come down to 0.85 last quarter. Our focus is on quality, on quality growth, you can see that in our numbers, our strategy is paying off. Looking forward, T-Mobile's company privileged growth opportunities are fully intact. This is rural, this is B2B, this is fixed wireless as the main areas. T-Mobile is investing. We're investing in digitization to drive efficiencies and customer experience. We are investing into UScellular integration to drive attractive synergies, we're investing in attractive fiber opportunities, we're investing in wireless technology leadership with evident results. As my colleague Srini said on the call, we are looking to forthcoming spectrum auctions as an opportunity to further cement our leadership position. Next, let me talk about Germany. In Germany, we are delivering with our 39th quarter of consecutive EBITDA growth.

Speaker #2: Looking forward, T-Mobile's company is privileged growth opportunities. Are fully intact. This is rural; this is B2B; and this is fixed wireless as the main areas.

Speaker #2: And T-Mobile is investing. We are investing in digitization to drive efficiencies and customer experience. We are investing into US cellular integration to drive attractive synergies.

Tim Höttges: We are investing into UScellular integration to drive attractive synergies, we're investing in attractive fiber opportunities, we're investing in wireless technology leadership with evident results. As my colleague Srini said on the call, we are looking to forthcoming spectrum auctions as an opportunity to further cement our leadership position. Next, let me talk about Germany. In Germany, we are delivering with our 39th quarter of consecutive EBITDA growth.

Speaker #2: And we are investing in attractive fiber opportunities. And we are investing in wireless technology, leadership with evident results. And as my looking to forthcoming spectrum auctions as an opportunity to further cement our leadership position.

Speaker #2: Germany. In Germany, we are delivering with our 39th quarter of consecutive EBITDA growth. We are investing in our future profitability and our networks are market-leading.

Tim Höttges: We are investing in our future profitability and our networks are market-leading. We keep investing ahead of the competition. We systematically leverage AI to drive additional efficiencies. Our mobile leadership is uncontested and further strengthened by our ongoing network modernization. We are delivering strong and consistent customer and service revenue growth, and by the way, even market share gains. The broadband market, however, is more challenging. We lost some subscribers this quarter. A key driver to this development is the fiber penetration alongside fiber homes passed. We are seeing steady progress here with 161,000 fiber net adds this quarter. As a priority, we will substantially accelerate this run rate, and with it, our fiber monetization. Positively, our broadband revenue growth improved this quarter. We are expecting further improvements in the coming quarters. Moving on to Europe. Our European segment delivers like a clockwork.

Speaker #2: And we keep investing ahead of the competition. We systematically leverage AI to drive additional Next, let me talk about efficiencies. Our mobile leadership is uncontested and further strengthened by our ongoing network modernization, we are delivering strong and consistent customer and service revenue growth, and by the way, even market share gains.

Speaker #2: The broadband market, however, is more challenging. And we lost some subscribers this quarter. A key driver to this development is the fiber penetration. Alongside fiber homes passed.

Tim Höttges: A key driver to this development is the fiber penetration alongside fiber homes passed. We are seeing steady progress here with 161,000 fiber net adds this quarter. As a priority, we will substantially accelerate this run rate, and with it, our fiber monetization. Positively, our broadband revenue growth improved this quarter. We are expecting further improvements in the coming quarters. Moving on to Europe. Our European segment delivers like a clockwork.

Speaker #2: We are seeing steady progress here with 161,000 fiber nets as this quarter. But as a priority, we will substantially accelerate this run rate. And with it, our fiber monetization.

Speaker #2: Positively, our broadband revenue growth improved this quarter. And we are expecting further improvements in the coming quarters. Moving on to Europe. Our European segment delivers like a clockwork.

Speaker #2: 4% organic service revenue growth, driven by consistent customer growth each quarter. 4% organic EBITDA growth this quarter, which is the 34th consecutive quarter of organic growth.

Tim Höttges: 4% organic service revenue growth driven by consistent customer growth each quarter. 4% organic EBITDA growth this quarter, which is the 34th consecutive quarter of organic growth. We are investing in networks and customer experience. We are also integrating platforms to drive synergies across the footprint and making good progress, thanks to Christian, on network at scale. Our European business demonstrates that the whole can be more than the sum of the parts, as we have promised. Last but not least, T-Systems. T-Systems is delivering strong and steady financial results. It has become a strategic asset for Deutsche Telekom. We are very lucky with all this sovereignty discussion to have the leading IT company here in Europe under our roof. Demand for sovereign cloud, demand for secure digitization, demand for AI applications and infrastructure is growing. T-Systems is our lighthouse to take advantage of these opportunities.

Speaker #2: We're investing in networks and customer experience. We are also integrating platforms to drive synergies across the footprints and making good progress thanks to Christian on network at scale.

Speaker #2: Our European business demonstrates that the whole can be more than the sum of the parts. As we have promised. And last but not least, to systems.

Tim Höttges: Last but not least, T-Systems. T-Systems is delivering strong and steady financial results. It has become a strategic asset for Deutsche Telekom. We are very lucky with all this sovereignty discussion to have the leading IT company here in Europe under our roof. Demand for sovereign cloud, demand for secure digitization, demand for AI applications and infrastructure is growing. T-Systems is our lighthouse to take advantage of these opportunities.

Speaker #2: T-Systems is delivering strong and steady financial results. It has become a strategic asset for Deutsche Telekom. We are very lucky, with all this sovereignty discussion, to have the leading European provider under our roof.

Speaker #2: Demand for sovereign cloud. Demand for secure digitization. Demand for AI applications. And infrastructure is growing and to systems is our lighthouse to take advantage of these opportunities.

Speaker #2: So in summary, we are delivering. Our EBITDA growth is best in class, and our earnings per share the growth is double-digit. Our cash flows are strong, and our leverage is prudent.

Tim Höttges: In summary, we are delivering. Our EBITDA growth is best in class and our earnings per share, the growth is double-digit. Our cash flows are strong and our leverage is prudent. We are investing to maintain and extend our strong growth into the future. Where we face challenges ahead, we act. This brings me to our capital allocation. Our capital allocation remains disciplined and focused on accretion for our shareholders, accretion as measured by adjusted earnings per share. As you know, we are not selling into the T-Mobile share buyback this year. Our T-Mobile stake therefore increased to 54.3% by July, up 2 percentage points from 1 year ago. We have been steadily executing our existing EUR 2 billion share buyback program here on the European side. Today we are topping this up.

Speaker #2: We are investing to maintain and extend our strong growth into the future. We are faced with challenges ahead. We act. This brings me to our capital allocation.

Speaker #2: Our capital allocation remains disciplined and focused on accretion for our shareholders. Accretion, as measured by adjusted earnings per share. And as you know, we are not selling into the T-Mobile share buyback this year.

Tim Höttges: Our capital allocation remains disciplined and focused on accretion for our shareholders, accretion as measured by adjusted earnings per share. As you know, we are not selling into the T-Mobile share buyback this year. Our T-Mobile stake therefore increased to 54.3% by July, up 2 percentage points from 1 year ago. We have been steadily executing our existing EUR 2 billion share buyback program here on the European side. Today we are topping this up.

Speaker #2: Our T-Mobile stake, therefore, increased to 54.3% by July, up 2% points from one year ago. We have been steadily executing our existing $2 billion share buyback program here on the European side.

Speaker #2: And today, we are topping this up. In addition to our ongoing share buyback, we are today proposing an additional share buyback facility of up to $3 billion on top in 2026 alone.

Tim Höttges: In addition to our ongoing share buyback, we are today proposing an additional share buyback facility of up to EUR 3 billion on top in 2026 alone. We have seen exceptional volatility in our shares in recent months. Our shares have traded at the bottom of their long-term valuation ranges and do not seem to reflect the growth opportunities we see. We are taking actions now and step up our share buyback program. Buying back our undervalued shares is an excellent investment, consistent with the capital allocation framework we outlined in our 2024 Capital Markets Day. At our cost of capital, buying back our shares drives attractive accretion to earnings per share. Why this magnitude? Because it can drive meaningful accretion to our adjusted earnings per share. Why not more? Because discipline always goes both ways.

Speaker #2: We have seen exceptional volatility in our shares in recent months. Our shares have traded at the bottom of their long-term valuation ranges. And do not seem to reflect the growth opportunities we see.

Speaker #2: And so, we are taking actions now and stepping up our share buyback program. Buying back our undervalued shares is an excellent investment, consistent with the capital allocation framework we outlined in our 2024 Capital Markets Day.

Tim Höttges: We are taking actions now and step up our share buyback program. Buying back our undervalued shares is an excellent investment, consistent with the capital allocation framework we outlined in our 2024 Capital Markets Day. At our cost of capital, buying back our shares drives attractive accretion to earnings per share. Why this magnitude? Because it can drive meaningful accretion to our adjusted earnings per share. Why not more? Because discipline always goes both ways.

Speaker #2: At our cost of capital, buying back our shares drives attractive accretion to earnings per share. Why this magnitude? Because it can drive meaningful accretion to our adjusted earnings per share.

Speaker #2: Why not more? Because discipline always goes both ways. We want to take advantage of our any excessive discounts. But we will not put our network leadership, our spectrum flexibility, our A rating, or our strategic flexibility at risk.

Tim Höttges: We want to take advantage of any excessive discounts, we will not put our network leadership, our spectrum flexibility, our A rating, or our strategic flexibility at risk. Why up to? Because we buy value. For us, the share buyback is an investment. It's not volume at any price. The bigger the gap to intrinsic value, the more attractive is the share buyback for us. Our dividend remains the reliable foundation of our shareholder remuneration. The buyback is a flexible complement to leverage exceptionally valued discounts in the interest of our shareholders. The additional facility increases our total shareholder remuneration in 2026 to almost EUR 10 billion if it is fully utilized. This is, by the way, the highest ever. As Christian will show you later, with our leverage ratio well below our stated 2.75 target, we have the balance sheet headroom for this additional facility.

Speaker #2: And why up to? Because we buy value. For us, the share buyback is an investment. It's not volume at any price. The bigger the gap to intrinsic value, the more attractive is the share buyback for us.

Speaker #2: Our dividend remains the reliable foundation of our shareholder remuneration. The buyback is a flexible complement to leverage exceptionally valued discounts in the interest of our shareholders.

Tim Höttges: The buyback is a flexible complement to leverage exceptionally valued discounts in the interest of our shareholders. The additional facility increases our total shareholder remuneration in 2026 to almost EUR 10 billion if it is fully utilized. This is, by the way, the highest ever. As Christian will show you later, with our leverage ratio well below our stated 2.75 target, we have the balance sheet headroom for this additional facility.

Speaker #2: The additional facility increases our total shareholder remuneration in 2026 to almost $10 billion. If it is fully utilized. And this is, by the way, the highest ever.

Speaker #2: As Christian will show you later, with our leverage ratio, well below our stated 2.75 target, we have the balance sheet headroom for this additional facility.

Speaker #2: I have now spoken about what we are doing. So finally, a few words on what we are not doing. We are not commenting on speculated transactions.

Tim Höttges: I have now spoken about what we are doing. Finally, a few words on what we are not doing. We are not commenting on speculated transactions. This is our well-established principle. We are not doing transactions that do not create a clear and compelling superior return for our shareholders. This is true for M&A, this is true for spectrum acquisitions, this is true for fiber CapEx, and this is true for share buybacks as well. I think it is fair to say that this management team has a 15-year track record of disciplined and successful capital allocation. The capital allocation decision we announced today, the additional buyback facility, reflects exactly this discipline. Beyond this announcement today, there's nothing to communicate. As mentioned, I will skip the next pages, as most topics have been covered, and move straight to our guidance increase on page 10.

Speaker #2: This is our well-established principle. We are not doing transactions that do not create a clear and compelling superior return for our shareholders. This is true for M&A, this is true for spectrum acquisitions, this is true for fiber capex, and this is true for share buybacks as well.

Speaker #2: I think it is fair to say that this management team has a 15-year track record of disciplined and successful capital allocation. The capital allocation decision we announced today the additional buyback facility reflects exactly this discipline.

Tim Höttges: I think it is fair to say that this management team has a 15-year track record of disciplined and successful capital allocation. The capital allocation decision we announced today, the additional buyback facility, reflects exactly this discipline. Beyond this announcement today, there's nothing to communicate. As mentioned, I will skip the next pages, as most topics have been covered, and move straight to our guidance increase on page 10.

Speaker #2: Beyond this announcement today, there's nothing to communicate. As mentioned, I will skip the next pages as most topics have been covered and move straight to our guidance increase on page 10.

Speaker #2: T-Mobile US raised its 2026 free cash flow guidance by 0.2 billion at the midpoint on 23rd of July. And we are passing on this guidance today.

Tim Höttges: T-Mobile US raised its 2026 free cash flow guidance by $0.2 billion at the midpoint on 23 July, and we are passing on this guidance today. As a result, our group free cash flow guidance increased to around EUR 20 billion. We continue to guide for constant currency group EBITDA growth of around 6% to EUR 47.5 billion in 2026. We reiterate our DT ex US EBITDA guidance of EUR 15.4 billion. Our guidance remains based on constant foreign exchange rates. As usual, we have a page in the pendings in which we compare our guidance with the consensus adjusted for foreign exchange. Based on current exchange ratios, our DT ex US EBITDA guidance would be in line with EUR 15.5 billion consensus. With this, I hand it over to Christian.

Speaker #2: As a result, our group free cash flow guidance increased to around $20 billion. We continue to guide for constant currency group EBITDA growth of around 6% to $47.5 billion in 2026.

Speaker #2: We reiterate our DTX US EBITDA guidance of 15.4 billion. Our guidance remains based on constant foreign exchange rates. And as usual, we have a page and the pendings in which we compare our guidance with the consensus adjusted for foreign exchange.

Tim Höttges: Our guidance remains based on constant foreign exchange rates. As usual, we have a page in the pendings in which we compare our guidance with the consensus adjusted for foreign exchange. Based on current exchange ratios, our DT ex US EBITDA guidance would be in line with EUR 15.5 billion consensus. With this, I hand it over to Christian.

Speaker #2: Based on the current exchange rate, our DTX US EBITDA guidance would be in line with the $15.5 billion consensus. And with this, I hand it over to Christian.

Speaker #1: Thanks, Tim. And hello from my side. As usual, let me quickly recap T-Mobile's strong second quarter results. And if we're taking a look at the numbers according to US GAAP, service revenue grew at close to 9% or 8.9% on a year-on-year basis.

Christian Illek: Thanks, Tim, and hello from my side. As usual, let me quickly recap T-Mobile's strong Q2 results. If we take a look at the numbers, according to U.S. GAAP, service revenue grew at close to 9% or 8.9% on a year-on-year basis, despite the fact that we had price increases that were rolling over. Obviously, the growth is supported by last year's acquisition, especially UScellular. The core EBITDA grew at 11.7%, that basically keeps T-Mobile well on track to achieve their ambitious financial targets. Account growth, as you know, grew at 277,000, the ARPA was up 2% on an annual basis, Tim talked about the lower churn on the postpaid phone. Let's move over to Germany, which I think had a solid quarter. Total revenues grew at 3.7%. Obviously, that sequential acceleration is largely due to the World Cup related non-service revenues.

Speaker #1: Despite the fact that we had prices increases that were rolling over. Obviously, the growth is supported by last year's acquisition, especially US cellular. The core EBITDA grew at 11.7% and that basically keeps T-Mobile well on track to achieve their ambitious financial targets.

Christian Illek: The core EBITDA grew at 11.7%, that basically keeps T-Mobile well on track to achieve their ambitious financial targets. Account growth, as you know, grew at 277,000, the ARPA was up 2% on an annual basis, Tim talked about the lower churn on the postpaid phone. Let's move over to Germany, which I think had a solid quarter. Total revenues grew at 3.7%. Obviously, that sequential acceleration is largely due to the World Cup related non-service revenues.

Speaker #1: The account growth, as you know, grew at $277K and the RPA was up 2% on an annual basis. And Tim talked about the lower churn on the postpaid phone.

Speaker #1: Let's move over to Germany, which I think had a solid quarter. Total revenues grew at 3.7%. Obviously, that sequential acceleration is largely due to the World Cup-related non-service revenues.

Speaker #1: This quarter's adjusted EBITDA grew at 2.7%, which is very consistent with the previous quarters. And for the next quarter, we expect the EBITDA to come a little below whereas the fourth quarter will be above that 2.5 to 2.7% range.

Christian Illek: This quarter's adjusted EBITDA grew at 2.7%, which is very consistent with the previous quarters. For the next quarter, we expect the EBITDA to come a little below, whereas the Q4 will be above that 2.5% to 2.7% range. The full-year guidance of EUR 11 billion EBITDA is fully intact. Mobile service revenues accelerate as well sequentially to 2.4%. We're basically trading at the upper end of the guidance quarter of 2% to 2.5%. Same holds true for fixed-line service revenues. They also accelerated. You see, and we get into this later on, there's a slight increase in broadband revenue growth, but it was also supported by some, I would call it, lumpy IT project business. As you can see on the next page, broadband revenues is now basically accelerating. We're at 1.6% in the Q1, 1.9% in the Q2.

Speaker #1: So the guidance, the full-year guidance of $11 billion EBITDA is fully intact. So mobile service revenues accelerate as well. Sequentially to 2.4%. So we're basically trading at the upper end of the guidance quarter of 2 to 2.5%.

Christian Illek: Mobile service revenues accelerate as well sequentially to 2.4%. We're basically trading at the upper end of the guidance quarter of 2% to 2.5%. Same holds true for fixed-line service revenues. They also accelerated. You see, and we get into this later on, there's a slight increase in broadband revenue growth, but it was also supported by some, I would call it, lumpy IT project business. As you can see on the next page, broadband revenues is now basically accelerating. We're at 1.6% in the Q1, 1.9% in the Q2.

Speaker #1: Same holds true for fixed line service revenues. They're also accelerated. You see when we get into this later on, there's a slight increase in broadband revenue growth.

Speaker #1: But it was also supported by some, I would call it, lumpy IT project business. As you can see on the next page, broadband revenues on Hans is now basically accelerating.

Speaker #1: We're at 1.6% in the first quarter, 1.9% in the second quarter, and we only had a small contribution from the backbook price increase in the second quarter.

Christian Illek: We only had a small contribution from the back book price increase in the Q2, but this effect will increase in the upcoming quarters. Therefore, we expect that the broadband revenue growth will further accelerate in the H2 of this year. Wholesale service revenues obviously declined because the price increases from the previous years, especially from last year, were rolling over. We don't anticipate any further deterioration. What we expect is that we basically cover volume losses largely through upselling and ARPU growth, either upselling copper or fiber infrastructure. Taking into account that we had solid growth in wholesale over the past two years, I think we're well on track to meet our guidance, which we have given at the CMD, which is basically stable revenues. Let's move over to the fixed KPIs, and let me start with the broadband customer losses.

Speaker #1: But this effect will increase in the upcoming quarters, and therefore, we expect that broadband revenue growth will further accelerate in the second half of this year.

Speaker #1: Wholesale service revenues obviously declined because the price increases from the previous years and especially from last year were rolling over. We don't anticipate any further deterioration.

Speaker #1: What we expect is that we basically cover volume losses largely throughout selling. And RPA growth either upselling copper or fiber infrastructure. So taking into account that we had solid growth in wholesale over the past two years, I think we're well on track to meet our guidance, which we have given at the CMD, which is basically stable revenues.

Christian Illek: What we expect is that we basically cover volume losses largely through upselling and ARPU growth, either upselling copper or fiber infrastructure. Taking into account that we had solid growth in wholesale over the past two years, I think we're well on track to meet our guidance, which we have given at the CMD, which is basically stable revenues. Let's move over to the fixed KPIs, and let me start with the broadband customer losses.

Speaker #1: Let's move over to the fixed KPIs. And let me start with the broadband customer losses. You see that we basically lost $20,000 customers this quarter.

Christian Illek: You see that we basically lost 20,000 customers this quarter. This is very much the same number which we had a year ago, and it's largely explainable through price-related churn. So far, that's the good news about that churn, the actual churn is much lower than we anticipated it in the business case. We expect this to moderate out in the Q3 and to normalize in the Q4, which will be a big driver also for the accelerated broadband revenue trends in the H2. We have many initiatives to improve our broadband performance. I think the most important one is fiber. You see that we've seen an 18% increase of fiber net adds on an annual basis and an 11% increase of our fiber penetration.

Speaker #1: This is very much the same number which we had a year ago. And it's largely explainable through price-related churn. So far, and that's the good news about that churn, the churn the actual churn is much lower than we anticipated it in the business case.

Speaker #1: And we expect this to moderate out in the third quarter and to normalize in the fourth quarter, which will be a big driver also for the accelerated broadband revenue trends in the second half.

Christian Illek: We expect this to moderate out in the Q3 and to normalize in the Q4, which will be a big driver also for the accelerated broadband revenue trends in the H2. We have many initiatives to improve our broadband performance. I think the most important one is fiber. You see that we've seen an 18% increase of fiber net adds on an annual basis and an 11% increase of our fiber penetration.

Speaker #1: We have many initiatives to improve our broadband performance. I think the most important one is fiber. And you see that we've seen an 18% increase of fiber net ads on an annual basis and an 11% increase of our fiber penetration.

Speaker #1: That is obviously not holding us back to continue to push on the renewed strategy both in SDUs and MDUs. And we're tracking well with an accelerated growth momentum here.

Christian Illek: That is obviously not holding us back to continue to push on the renewed strategy, both in SDUs and MDUs. We're tracking well with an accelerated growth momentum here. Finally, on TV, we're seeing steady growth in triple play and also in contracted OTT. Over the H1, we basically added 200,000 TV customers. On top, throughout the successful World Cup coverage, we welcomed roughly 1 million additional non-contracted OTT customers. It's now up to the go-to-market teams to retain as many of those customers as possible. Next page 18, we're seeing the mobile KPIs. I think what you see, especially on the growth on volume or on data usage, that very much reflects our unlimited propositions, which we introduced a year ago. Moving over to Europe, Tim called it a clockwork. I would call it a Swiss clockwork. It's really phenomenal what they're providing.

Speaker #1: Finally, on TV, we're seeing steady growth in triple play and also in contracted OTTs. So over the first half, we basically added 200,000 TV customers.

Speaker #1: And on top throughout the successful World Cup coverage, we welcomed roughly a million additional non-contracted OTT customers. It's now up to the go-to-market teams to retain as many of those customers as possible.

Christian Illek: It's now up to the go-to-market teams to retain as many of those customers as possible. Next page 18, we're seeing the mobile KPIs. I think what you see, especially on the growth on volume or on data usage, that very much reflects our unlimited propositions, which we introduced a year ago. Moving over to Europe, Tim called it a clockwork. I would call it a Swiss clockwork. It's really phenomenal what they're providing.

Speaker #1: So next page, 18, we're seeing the mobile KPIs. I think what you see, especially on the growth on volume or on data usage, that very much reflects our unlimited propositions which we introduced a year ago.

Speaker #1: Moving over to Europe and Tim called it a clockwork. I would call it a Swiss clockwork. It's really phenomenal what they're providing. The reported revenues grew at 1.5%.

Christian Illek: The reported revenues grew at 1.5%. The organic service growth was 4.1%. Actually, you saw steady growth across mobile, across fixed, and across IT. The reported revenues were impacted by three factors. Obviously, we had a deconsolidation of Romania this year. We had a planned unwind of wholesale transit revenues, and that was somewhat upset by the very strong Hungarian currency, the forint. Organic EBITDA growth was accelerating to 4.1%. We're fully on track with our full year guidance. The difference between organic and reported EBITDA is also related to the strong forint, which we're happy to see right now in this given year. On the commercial performance, you see a very steady performance across all 4 categories. Nothing to basically explain here. T-Systems, I think they posted a healthy year-on-year growth when it comes to revenue and EBITDA.

Speaker #1: The organic service growth was 4.1%. And actually, you saw steady growth across mobile, across fixed, and across IT. The reported revenues were impacted by three factors.

Speaker #1: Obviously, we had a deconsolidation of Romania this year. We had a planned unwind of wholesale transit revenues. And that was somewhat upset by the very strong Hungarian currency, the forint.

Speaker #1: Organic EBITDA growth was accelerating to 4.1%. We're fully on track with our full-year guidance. The difference between organic and reported EBITDA is also related to the strong forint, which we're happy to see right now in this given year.

Christian Illek: We're fully on track with our full year guidance. The difference between organic and reported EBITDA is also related to the strong forint, which we're happy to see right now in this given year. On the commercial performance, you see a very steady performance across all 4 categories. Nothing to basically explain here. T-Systems, I think they posted a healthy year-on-year growth when it comes to revenue and EBITDA.

Speaker #1: So on the commercial performance, you see a very steady performance across all four categories. Nothing to basically explain here. T-Systems, I think they posted a healthy year-on-year growth when it comes to revenue and EBITDA.

Speaker #1: They're well on track to hitting their CMD targets. The order book was due to phasing a bit slower, but we expect a much stronger second half and therefore also growth over the full year.

Christian Illek: They're well on track to hitting their CMD targets. The order book was due to phasing a bit slower, but we expect a much stronger H2 and therefore also growth over the full year. Tim talked about this. T-Systems was able to secure two really important flagship contracts. One is Volkswagen, where we're going to build and operate Volkswagen's global private cloud network. In April, we have been awarded, together with SAP, to develop the central citizen app. That shows that we are really well-positioned when it comes to digital sovereignty and that T-Systems is at the center of what's currently important on digitalization and sovereignty here. That concludes my operational review, and I move over to the reported financials.

Speaker #1: Tim talked about this T-Systems was able to secure two really important flagship contracts. One is Volkswagen where we're going to build and operate Volkswagen's global private cloud network.

Speaker #1: And in April, we have been awarded together with SAP to develop the central citizen app. And that shows that we are really well positioned when it comes to digital sovereignty and that T-Systems is at the center of what's currently important on digitization and sovereignty here.

Christian Illek: In April, we have been awarded, together with SAP, to develop the central citizen app. That shows that we are really well-positioned when it comes to digital sovereignty and that T-Systems is at the center of what's currently important on digitalization and sovereignty here. That concludes my operational review, and I move over to the reported financials.

Speaker #1: So that concludes my operational review, and I will move over to the reported financials. What you see is that we had some headwinds coming from the dollar.

Christian Illek: What you see is we had some headwinds coming from the dollar, but still, you see that in Q2, EBITDA growth at 7.5%, adjusted earnings almost close to 13% this quarter. On the free cash flow, you see that free cash flow was up by 3% on a year-on-year basis, very much driven by the net cash flow from operations, which was burdened by the restructuring cash outs in the US. The adjusted net profit benefited especially from the adjusted EBITDA, which is a very strong performance, and you see that 11% here on a year-on-year basis. Next page. As always, you see our net debt development. Left-hand side without leases, it increased by roughly EUR 5 billion on a quarter-on-quarter basis. This is largely driven by the DT and US shareholder remuneration.

Speaker #1: But still, you see that in the second quarter, EBITDA growth at 7.5%, adjusted earnings almost close to 13% this quarter. On the free cash flow, you see that free cash flow was up by 3% on a year-on-year basis, very much driven by the net cash flow from operations.

Speaker #1: Which was burdened by the restructuring cash outs in the US. And the adjusted net profit benefited especially from the adjusted EBITDA, which is a very strong performance.

Christian Illek: The adjusted net profit benefited especially from the adjusted EBITDA, which is a very strong performance, and you see that 11% here on a year-on-year basis. Next page. As always, you see our net debt development. Left-hand side without leases, it increased by roughly EUR 5 billion on a quarter-on-quarter basis. This is largely driven by the DT and US shareholder remuneration.

Speaker #1: And you see that 11% here on the year-on-year basis. Next page, as always, you see Left-hand side without leases. It increased by roughly $5 billion on a year-on-year basis on a quarter basis.

Speaker #1: This is largely driven by the DT and US shareholder remuneration. And you see also on the leverage ratios that including leases, we're tracking well with 268 and without leases on 2.3.

Christian Illek: You see also on the leverage ratios that including leases, we're tracking well with 268 and without leases on 2.3. With that extended share buyback program here on the DT side, we still will meet a leverage target, which will be below 275. I think that completes my review, and we're opening up for Q&A.

Speaker #1: And with that expanded share buyback program here on the DT side, we still will meet a leverage target, which will be below 275. I think that completes my review.

Speaker #1: And we're opening up for Q&A.

Speaker #2: Yeah. Thank you very much, Tim. Thank you very much, Christian. We'll now begin the Q&A session. If you would like to ask a question via Webex, please use the raise hand function.

Hannes Wittig: Yeah. Thank you very much, Tim. Thank you very much, Christian. We will now begin the Q&A session. If you would like to ask a question via WebEx, please use the raise hand function. Should you wish to withdraw your question, simply click the raise hand button again. If you are joining by phone, please press star three and unmute your line, you press star six. To withdraw your question, please press star three once again. I will announce your name when it is your turn to speak. As usual, we would appreciate if you could limit yourselves to two questions. Please also note that you will need to mute and unmute your line manually. With that, let us begin. I think the first question is from Robert Grindley, Deutsche Bank. Robert?

Speaker #2: Should you wish to withdraw your question, simply click the raise hand button again. If you're joining by phone, please press stars three and unmute your line you press star six.

Speaker #2: To withdraw your question, please press star three once again. I will announce your name when it's your turn to speak. As usual, we would appreciate if you could limit yourselves to two questions.

Hannes Wittig: To withdraw your question, please press star three once again. I will announce your name when it is your turn to speak. As usual, we would appreciate if you could limit yourselves to two questions. Please also note that you will need to mute and unmute your line manually. With that, let us begin. I think the first question is from Robert Grindley, Deutsche Bank. Robert?

Speaker #2: Please also note that you will need to mute and unmute your line manually with that. Let's begin. And I think the first question is from Robert Grindle, Deutsche Bank.

Speaker #2: Robert?

Speaker #3: Yeah. Thank you. Got it. Thank you. Good afternoon. And great going on the clear view expressed about your own equity value today. Does buying back more of your own shares tilt your view on not selling into the T must buy back?

Robert Grindley: Yeah. Thank you. Good afternoon, and great going on the clear view expressed about your own equity value today. Does buying back more of your own shares tilt your view on not selling into the TMUS buyback, or is that an entirely separate decision dependent on the TMUS share price? I think, Tim, you confirmed you will continue not selling even with the new buyback. Is that right? At least for this year. My second question is, there was some press recently that Cellnex had been in touch with GD Towers about a deal. Any comment on that? I think at the CMD, you said that something could be done on towers. What's your latest thinking there? Presumably, you think your towers are worth more than public multiples. Thank you.

Robert Grindle: Yeah. Thank you. Good afternoon, and great going on the clear view expressed about your own equity value today. Does buying back more of your own shares tilt your view on not selling into the TMUS buyback, or is that an entirely separate decision dependent on the TMUS share price? I think, Tim, you confirmed you will continue not selling even with the new buyback.

Speaker #3: Or is that an entirely separate decision dependent on the T must share price? I think, Tim, you confirmed you will not you'll continue not selling even with the new buyback.

Speaker #3: Is that right? At least for this year. And my second question is, there was some press recently that Celnex had been in touch with GD Towers about a deal.

Robert Grindle: Is that right? At least for this year. My second question is, there was some press recently that Cellnex had been in touch with GD Towers about a deal. Any comment on that? I think at the CMD, you said that something could be done on towers. What's your latest thinking there? Presumably, you think your towers are worth more than public multiples. Thank you.

Speaker #3: Any comment on that? I think at the CMD, you said that something could be done on towers. What's your latest thinking there? Presumably, you think your towers are worth more than public multiples.

Speaker #3: Thank you.

Speaker #2: Robert, let me answer the first question. So first, it's completely independent decisions. One has been taken care on the T-Mobile US board level. And the other one here on the DT board level.

Christian Illek: Robert, let me answer the first question. First, it's completely independent decisions. One has been taken care on the T-Mobile US board level and the other one here on the DT board level. I think the scheme is quite comparable. You see that T-Mobile is now trading at, let's say, roughly EUR 175. We think we should take advantage out of this, let's say, volatility, therefore, we expanded that share buyback program back in Q2 by up to EUR 3.6 billion. Same holds true for DT. I think if you take a look at the share price in which it traded over the course of this year, we were trading from above EUR 34 to below EUR 24. Obviously, if you compare this against our, let's say, long-term EPS multiple, we see there's opportunities to actually have an accretive share buyback and buying undervalued shares

Speaker #2: I think the scheme is quite comparable. You see that T-Mobile is now trading at a, let's say, roughly $175. I think we think we should take advantage out of this let's say volatility and therefore we expanded that share buyback program back into Q2 by up to 3.6 billion.

Speaker #2: And same holds true for DT. So I think if you take a look at the share price in which it traded over the course of this year, we were trading from above 34 to below 24.

Christian Illek: I think if you take a look at the share price in which it traded over the course of this year, we were trading from above EUR 34 to below EUR 24. Obviously, if you compare this against our, let's say, long-term EPS multiple, we see there's opportunities to actually have an accretive share buyback and buying undervalued shares

Speaker #2: And obviously, if you compare this against our let's say long-term EPS multiple, we see there's opportunity to actually have a creative share buyback. And buying undervalued shares to a larger degree.

Christian Illek: To a larger degree. This is, as I said, independent decisions, and yes, I can confirm that we're not selling into the share buyback of T-Mobile US over the course of this year.

Speaker #2: So this is, as I said, independent decisions. And yes, I can confirm that we're not selling into the share buyback of T-Mobile US over the course of this year.

Speaker #4: And Christian, maybe to add one sentence here: by buying back our shares, we even buy into the profitability of the T-Mobile US stock, and we believe in the US stock.

Tim Höttges: Christian, maybe to add one sentence here. By buying back our shares, we even buy into the profitability of the T-Mobile US stock, and we believe in the US stock, and that is why we have already built 55% of the stock, and it's ongoing, by not participating in their share buyback. We increase our value, and we increase the value of the DT by how we are doing that. To be very clear, we looked on this one from an investment perspective. If you look to the free cash flow yield, which we have on our DT stock today for our shareholders, we are around 10%. This is better than any investment which we can do in these days.

Speaker #4: And that is why we have already built 55% of the stock and it's ongoing. By not participating in their share buyback. So we increase our value.

Speaker #4: And we increase the value of the DT by how we are doing that. And to be very clear, we looked on this one from an investment perspective.

Speaker #4: And if you look to the free cash flow yield, which we have on our DT stock today for our shareholders, we are around 10%.

Speaker #4: This is better than any investment which we can do these days. Secondly, we have shown 2% growth over the last five or six years—more than all our European peers.

Tim Höttges: Secondly, we have shown 2% growth over the last five, six years, more than all our European peers, we're trading with a discount to the multiple of our European peers. Therefore, even this is not reflected in our value. Another second reason to buy. The third one is the accretion for our EPS, which I mentioned already in my speech. A third argument. There's so much argument that our company is undervalued, and our performance going forward is even supporting this on a midterm and long-term perspective, that we took this very confident, clear message to significantly increase our share buyback program here in Europe by EUR 3 billion. Let me answer the second question. What is the last thinking on that one? To be honest, we are not commenting on any M&A speculations here. In principle, we are always open-minded for good opportunities here.

Speaker #4: But we're trading at a discount to the multiple of our European peers, and therefore, even this is not reflected in our value. Another second reason to buy.

Speaker #4: And the third one is decreasing for our EPS, which I mentioned already in my speech. Third argument, there's so much argument that our company is undervalued and our performance going forward is even supporting this on a midterm and long-term perspective.

Tim Höttges: There's so much argument that our company is undervalued, and our performance going forward is even supporting this on a midterm and long-term perspective, that we took this very confident, clear message to significantly increase our share buyback program here in Europe by EUR 3 billion. Let me answer the second question. What is the last thinking on that one? To be honest, we are not commenting on any M&A speculations here. In principle, we are always open-minded for good opportunities here.

Speaker #4: That we took this very confident, clear message to significantly increase our share buyback program here in Europe by 3 billion. Let me answer the second question.

Speaker #4: What is the last thinking on that one? To be honest, we are not commending on any M&A speculations here. In principle, we are always open-minded for good opportunities here.

Speaker #4: But there is nothing I can communicate. We are very happy with our assets as they are today. And therefore, to be honest, this is something where you have to ask Cellnex or DigitalBridge—I cannot comment on this.

Tim Höttges: There is nothing I can communicate. We are very happy with our assets of today. Therefore, to be honest, this is something where you have to ask Cellnex or DigitalBridge. I cannot comment on this.

Speaker #3: I don't know. Thank you.

Robert Grindley: Thank you very much. Thank you.

Robert Grindle: Thank you very much. Thank you.

Speaker #2: Thank you. Thank you, Robert. Thank you, Tim. And Christian. So next, we go to Carl Murdoch-Smith at Citi, please.

Hannes Wittig: Thank you. Thank you, Robert. Thank you, Tim and Christian. Next we go to Carl Murdock-Smith at Citi, please.

Speaker #5: That's great. Thanks, Hannes. Two questions from me. Firstly, on one of the reasons for the potential weakness in the share price is concerns about satellites.

Carl Murdock-Smith: That's great. Thanks, Hannes. Two questions from me. Firstly, on one of the reasons for the potential weakness in the share prices is concerns about satellite. You just talked about your investments to maintain market leadership. SpaceX earlier this week made comments that it's not out of the question that at some point Starlink will deliver a majority of the world's internet, talking about that on a 10-year timeframe. Also stating that it believes its service will be better than yours in the US. I'd love to hear your thoughts on those comments. Secondly, just on the German EBITDA phasing, Christian, that you mentioned. Can you just expand a bit more on the reasons and potential quantum for the delta in the Q3, Q4 phasing on German EBITDA growth? Thank you.

Speaker #5: You just talked about your investments to maintain market leadership. SpaceX earlier this week made comments that it's not out of the question that at some point Starlink will deliver a majority of the world's internet.

Speaker #5: And talking about that on a 10-year timeframe. And also stating that it believes its service will be better than yours in the US. I'd love to hear your thoughts on those comments.

Carl Murdock-Smith: Also stating that it believes its service will be better than yours in the US. I'd love to hear your thoughts on those comments. Secondly, just on the German EBITDA phasing, Christian, that you mentioned. Can you just expand a bit more on the reasons and potential quantum for the delta in the Q3, Q4 phasing on German EBITDA growth? Thank you.

Speaker #5: And then secondly, just on the German EBITDA phasing, Christian, that you mentioned. Can you just expand a bit more on the reasons and potential quantum for the delta in the Q3, Q4 phasing on German EBITDA growth?

Speaker #5: Thank you.

Speaker #4: So by the way, the first, we take SpaceX ambitions very seriously. That's the first one. Satellite connectivity will expand the market and improve coverage in places, especially where terrestrial economics are geographical things are challenging.

Tim Höttges: By the way, the first, we take SpaceX ambitions very seriously. That's the first one. Satellite connectivity will expand the market and improve coverage in places, especially where terrestrial economics or geographical things are challenging. No question. T-Mobile, by the way, and Deutsche Telekom, we are already well-positioned to integrate our satellite capabilities, where they improve the customer proposition. We have a Gen 1 deal in the US, we have Gen 2 deal for Europe, and we are ready to integrate that direct to device. Therefore, this is definitely something which, from our proposition, always best connected, is something which we consider. At the same time, high-capacity terrestrial networks, as we are providing them, they retain significant structural advantages in dense markets, no question. Capacity, indoor coverage, latency, simultaneous usage, and the cost per gigabyte are advantageous compared to satellite services.

Speaker #4: No question. T-Mobile, by the way, and Deutsche Telekom, we are already well positioned to integrate satellite capabilities. Where they improve the customer proposition. We have a Gen 1 deal in the US.

Tim Höttges: We have a Gen 1 deal in the US, we have Gen 2 deal for Europe, and we are ready to integrate that direct to device. Therefore, this is definitely something which, from our proposition, always best connected, is something which we consider. At the same time, high-capacity terrestrial networks, as we are providing them, they retain significant structural advantages in dense markets, no question. Capacity, indoor coverage, latency, simultaneous usage, and the cost per gigabyte are advantageous compared to satellite services.

Speaker #4: We have Gen 2 deal for Europe. And we are ready to integrate that in direct-to-device. So therefore, this is definitely something which, from our proposition, always best connected is something which we consider.

Speaker #4: At the same time, high-capacity terrestrial networks, as we are providing them, they retain significant structural advantages in dense markets. No question. Capacity indoor coverage, latency, simultaneous usage, and the cost per gigabyte are advantageous compared to satellite services.

Speaker #4: The right answer for us is not to dismiss the technology. For us, it is to keep, let's say, extending our own advantages against any other technology.

Tim Höttges: The right answer for us is not to dismiss the technology. For us, it is to keep extending our own advantages against any other technology. This is the spectrum leadership, which is critical. Network density, which is, I think, the most important one. The distribution for our brand and the customer relationship, which we have built. Then the financial capacity on developing the networks in the way how we're doing it. Therefore, for me, I can tell you there are a lot of announcements. To be honest, I'm a little bit irritated how the market is reacting on some of that one. Yesterday, we heard something about Femtocell. Guys, we had a Femtocell discussion years ago, remember that? We looked it up whether this is an alternative, and we dismissed this opportunity for good reasons from a technology perspective.

Speaker #4: This is the spectrum leadership, which is critical. Network density which is, I think, the most important one. Distribution for our brand and the customer relationship which we have built and then the financial capacity on developing the networks in the way how we're doing it.

Tim Höttges: Then the financial capacity on developing the networks in the way how we're doing it. Therefore, for me, I can tell you there are a lot of announcements. To be honest, I'm a little bit irritated how the market is reacting on some of that one. Yesterday, we heard something about Femtocell. Guys, we had a Femtocell discussion years ago, remember that? We looked it up whether this is an alternative, and we dismissed this opportunity for good reasons from a technology perspective.

Speaker #4: So therefore, for me, I can tell you there are a lot of announcements to be honest, I'm a little bit irritated how the market is reacting on some of that one.

Speaker #4: Yesterday, we heard something about Femto. Guys, we had the Femto discussion years ago, remember that? And we looked it up whether this is an alternative.

Speaker #4: And we dismissed this opportunity for good reasons from a technology perspective. And suddenly, this is becoming a new kind of substitutional risk. We don't see that magnitude.

Tim Höttges: Suddenly this is becoming a new kind of substitution risk. We do not see that magnitude. We do not see any kind of significantly a disadvantage for our technologies, and we will do everything with all, let us say, the generations who have built this infrastructure already, to keep this leadership. Therefore, the results are on our side. The customer experience as well. Therefore, some of these aspirations are very far-fetched and very conceptual, but nevertheless, it is not my money, it is your money. But we are doing our business, and we are convinced that there is no substitution risk.

Speaker #4: We do not see any kind of significantly a disadvantage for our technologies. And we will do everything with all, let's say, that the generations who have built this infrastructure already to keep this leadership.

Speaker #4: So, therefore, the results are on our side. The customer experience as well. And therefore, some of these aspirations are very, very far-fetched and very conceptual.

Speaker #4: But nevertheless, it is not my money. It's your money. But we are doing our business. And we are convinced that there is no substitution risk.

Speaker #2: OK. On the second question, Carl, first of all, this is related to cost phasing, nothing else. So the revenue trends, as I said earlier on, we expect to be strong both on the mobile side but also on the broadband side where we expect an acceleration of broadband revenue trends.

Christian Illek: Okay. On the second question, Carl. First of all, this is related to cost phasing, nothing else. The revenue trend, as I said earlier on, we expect to be strong both on the mobile side, but also on the broadband side, where we expect an acceleration of broadband revenue trends. But this is a phasing effect, which you also had to a larger degree, to be very clear, in 2025. Remember, we had almost no EBITDA growth in 2025 in Q3, and then it bumped up again. That will be not that dramatic this year, but we will trail below the 2.5% in Q3, and we will trail above 2.5% in Q4.

Speaker #2: But this is a phasing effect which you also had to a larger degree to be very clear in '25. Remember, we had almost no EBITDA growth in '25 and Q3.

Speaker #2: And then it bumped up again. That will be not that dramatic this year. But we will trail below the 2.5% in Q3. And we will trail above 2.5% in Q4.

Speaker #2: OK. Thank you, Christian. Next is Josh Milt at BNP Paribas, please.

Hannes Wittig: Okay. Thank you, Christian. Next is Josh Mills at BNP Paribas, please.

Speaker #5: Hi, guys. Thank you very much for taking the question. I wanted to come back to some of Tim's opening remarks about the relationship between CT and TMIS.

Josh Mills: Hi, guys. Thank you very much for taking the question. I wanted to come back to some of Tim's opening remarks about the relationship between DT and T-Mobile, but without specifying any press reports. Because from the outside it looks like with your ownership stake, the ability you have to participate or not participate in the buyback and the very strong working relationship between your European and U.S. teams, that the partnership works very well. So the simple question is there anything we are missing or any new opportunities that you are looking at working on, that the current corporate structure does not allow you to do or frustrates? Would be the first question. And then on the second question, taking it down to Germany. We saw, as expected, slightly weakened attach this quarter following the backbook price rise earlier in the year.

Speaker #5: But without specifying any press reports, because from the outside, it looks like with your ownership stake, the ability you have to participate or not participate in the buyback and the very strong working relationship between your European and US teams that the partnership works very well.

Speaker #5: So the simple question is, is there anything we're missing or any new opportunities that you're looking at working on that the current corporate structure doesn't allow you to do or frustrates would be the first question.

Josh Mills: So the simple question is there anything we are missing or any new opportunities that you are looking at working on, that the current corporate structure does not allow you to do or frustrates? Would be the first question. And then on the second question, taking it down to Germany. We saw, as expected, slightly weakened attach this quarter following the backbook price rise earlier in the year.

Speaker #5: And then on the second question, taking it down to Germany, we saw, as expected, slightly weaker net ads this quarter. Following the backward price rise earlier in the year.

Speaker #5: From your perspective, are we now through the peak churn of initial customers responding to that backward price increase? And how do you see the front book price competition in German broadband at the moment?

Josh Mills: From your perspective, are we now through the peak churn of initial customers responding to that backbook price increase? How do you see the frontbook price competition in German broadband at the moment? I think there's been a few more promotions across the board in that market. Be great to hear your thoughts there. Thank you.

Speaker #5: I think there's been a few more promotions across the board in that market. It'd be great to hear your thoughts there. Thank you.

Speaker #2: So let me start with the second question. On the net ads, as you said, rightfully so, we will expect that the churn related net ad losses will moderate in Q3.

Christian Illek: Let me start with the second question on the net adds. As you said, rightfully so, we will expect that the churn-related net add losses will moderate in Q3 and will basically be normalized in Q4, because then there is no chance for customers to actually terminate their contracts. I think the good element about this, what we're seeing right now, is that the initial assumption of the marketing and sales teams were way more negative than what we see as actual churn. The churn is significantly lower than we anticipated it to be, but the trend is actually in our favor, moderating in Q3 and normalizing in Q4. On frontbook price competition, I think everyone is a bit promotional. We are promotional, the other guys are promotional. Structurally, I don't see any kind of significant change. I think everyone's talking about value.

Speaker #2: And we'll basically be normalized in Q4. Because then there is no chance for customers to actually terminate their contracts. The good I think the good element about this what we're seeing right now is that the initial assumption of the marketing and sales teams were way more negative than what we see as actual churn.

Speaker #2: So the churn is significantly lower than we anticipated it to be. But the trend is actually in our favor moderating in Q3 and normalizing in Q4.

Christian Illek: The churn is significantly lower than we anticipated it to be, but the trend is actually in our favor, moderating in Q3 and normalizing in Q4. On frontbook price competition, I think everyone is a bit promotional. We are promotional, the other guys are promotional. Structurally, I don't see any kind of significant change. I think everyone's talking about value.

Speaker #2: And on front book price competition, I think everyone is a bit promotional. We are promotional. The other guys are promotional. But structurally, I don't see any kind of significant change.

Speaker #2: I think everyone's talking about value. So let's prove this pudding. I think we have shown that with our back book price increase and also with the front book price increase last year, that we're focusing on value.

Christian Illek: Let's prove this pudding. I think we have shown that with our backbook price increase and also with the frontbook price increase last year, that we're focusing on value. I think that's the only way to kind of getting into growth in the broadband market because we don't have hardly any volume growth in that market.

Speaker #2: And I think that's the only way to kind of getting into growth in the broadband market. Because we don't have hardly any volume growth in that market.

Speaker #4: Look, once we got to your question on the relationship, look, we have a clear ownership in the US. We have a financial consolidation. And control.

Tim Höttges: Look, with regard to your question on the relationship. Look, we have a clear ownership in the US. We have a financial consolidation and control. We have a governance which is well established with, let's say, the amount of board seats we are having and the veto rights which we have as a shareholder. On the operational management, on the day-to-day decisions, being it pricing, customer propositions, network execution, marketing, all these kind of things. I can tell you, it is anyhow our philosophy in the group to keep that independent in the countries. This is the empowerment and, to be honest, one of the reasons why Deutsche Telekom is more successful than other telcos was that we were having this right balance between central and local found for the reason. When it comes to strategic alignment, look, we are always acting as two groups.

Speaker #4: We have a governance which is well established with, let's say, the amount of board seats we are having and the veto rights which we have as a shareholder.

Speaker #4: And on the operational management, on the day-to-day decisions, being it pricing, customer propositions, network execution, marketing, all this kind of things, I can tell you it is anyhow out of philosophy in the group to keep that independent in the countries.

Tim Höttges: I can tell you, it is anyhow our philosophy in the group to keep that independent in the countries. This is the empowerment and, to be honest, one of the reasons why Deutsche Telekom is more successful than other telcos was that we were having this right balance between central and local found for the reason. When it comes to strategic alignment, look, we are always acting as two groups.

Speaker #4: This is the empowerment and to be honest, one of the reasons why Deutsche Telekom is more successful than other telcos was that we were having this right balance between central and local found for the reason.

Speaker #4: When it comes to strategic alignment, look, we are always acting as two groups. And two groups are always acting as two groups. And that means whenever, for instance, we are developing software, like the one app, we have a third-party transaction.

Tim Höttges: Two groups are always acting as two groups, and that means whenever, for instance, we are developing software, like the One App, we have a third-party transaction. Look, yes, we are collaborating, but it is coming with complexity. There's no question. We have to go through the board, we have to go into the audit committee with each of the transactions, with each of the joint activities, because we have to file third-party transactions. Second, in some areas it's not easy. I can tell you the Apple account, for instance, is dealt not jointly. It is dealt from two companies independently. In some areas we are not able to leverage our procurement activities these days. These are minor areas. When it comes to the big strategic things, we can really work together in a good way.

Speaker #4: So look, yes, we are collaborating. But it is coming with complexity. There is no question. Because we have to go through the board. We have to go into the audit committee with each of the transactions, with each of the joint activities.

Speaker #4: Because we have to file third-party transactions. Second, in some areas, it's not easy. I can tell you the Apple account, for instance, is dealt not jointly.

Tim Höttges: I can tell you the Apple account, for instance, is dealt not jointly. It is dealt from two companies independently. In some areas we are not able to leverage our procurement activities these days. These are minor areas. When it comes to the big strategic things, we can really work together in a good way.

Speaker #4: It is dealt from two companies independently. So in some areas, we are not able to leverage our procurement activities these days. But these are minor areas when it comes to the big strategic things.

Speaker #4: We can really work together in a good way. Sometimes it's a bit complicated due to the two entities which we always have to consider.

Tim Höttges: Sometimes it's a bit complicated due to the two entities which we always have to consider. These are the limitations which we have. I think we're on a good track to get all our interest and all our strategic ambitions realized in this structure which we have and the trust we have built between the teams.

Speaker #4: But these are the limitations which we have. I think we are in a good track to get all our interest and all our strategic ambitions realized.

Speaker #4: In this structure which we have in the trust we have built between the teams.

Speaker #2: Excellent. And surely T-Mobile's share price also over the value creation in the US, the fact that it's the most valuable telco in the world, I think bears witness to the success of our situation.

Hannes Wittig: Excellent. Surely T-Mobile's share price also over the value creation in the US. The fact that it's the most valuable telco in the world, I think bears witness to the success of our situation. Next up is Akhil Dattani at JPMorgan.

Speaker #2: But the next is up is Akhil Dadhani at JP Morgan.

Speaker #6: Hi. Good afternoon. Thanks for taking the questions. The first is just on data centers. Tim, you've discussed in the past your views around the AI gigafactory project from Europe and some of your concerns with some of the elements of that.

Akhil Dattani: Hi, good afternoon. Thanks for taking the questions. The first is just on data centers. Tim, you've discussed in the past your views around the AI Gigafactory project from Europe and some of your concerns with some of the elements of that. Now that we're getting the process of now submitting proposals, could you update us as to whether those have been addressed, where you stand on that? Also more broadly on data centers, you talked a lot about your off-balance sheet data center assets, some of the opportunities there. Just any further thoughts in terms of how you can drive and monetize those pieces going forward? That'll be the first question. The second one is just going back to, I guess, some of the broader points you raised at the beginning of the call around the buybacks and overhauls.

Speaker #6: Now that we're getting the process of now submitting proposals, could you update us as to whether those have been addressed, where you stand on that?

Speaker #6: And also more broadly on data centers, you talked a lot about your off-balance sheet data center assets, some of the opportunities there. Just any further thoughts in terms of how you can drive and monetize those pieces going forward?

Akhil Dattani: Also more broadly on data centers, you talked a lot about your off-balance sheet data center assets, some of the opportunities there. Just any further thoughts in terms of how you can drive and monetize those pieces going forward? That'll be the first question. The second one is just going back to, I guess, some of the broader points you raised at the beginning of the call around the buybacks and overhauls.

Speaker #6: So that'd be the first question. And the second one is just going back to, I guess, some of the broader points you raised at the beginning of the call around the buybacks and overhangs.

Speaker #6: Obviously, it's a strong signal to the market that you believe your stock's undervalued. But I guess one of the tricky elements to the debate is we're debating something very long duration that's very hard to quantify.

Akhil Dattani: Obviously, it's a strong signal to the market that you believe your stock's undervalued. I guess one of the tricky elements to the debate is we're debating something very long duration that's very hard to quantify. You gave us some helpful color around why you think satellite risks are misunderstood and maybe overplayed. As you think about business planning going forward, how do you think about routes to growing and protecting your moat more strongly? At the same point, what sort of things can you do to disrupt yourself as you think about the opportunity at fraenk? Not just what are the defensive tools, but also offensively, what can you do here to create more value?

Speaker #6: Now, you gave us some helpful color around why you think satellite risks are misunderstood and maybe overplayed. But if you think about business planning going forward, how do you think about routes to growing and protecting your more strongly?

Akhil Dattani: As you think about business planning going forward, how do you think about routes to growing and protecting your moat more strongly? At the same point, what sort of things can you do to disrupt yourself as you think about the opportunity at fraenk? Not just what are the defensive tools, but also offensively, what can you do here to create more value?

Speaker #6: And at the same point, what sort of things can you do to disrupt yourself as you think about the opportunity it creates? And not just what are the defensive tools, but also offensively, what can you do here to create more value?

Speaker #4: Well, good questions. Let me think on the answers. Now, the first one, talking about the data centers—our ambition is to grow our data center business.

Tim Höttges: Wow. Good questions. Let me think on the answers. The first one, talking about the data centers. Our ambition is to grow our data center business in line with the demand which we see for sovereign, secure, and AI-ready infrastructure, which we clearly see here in Europe. I can tell you, if you look to our industrial AI cloud, which we have built with NVIDIA in Munich, the 10,000 GPUs, the Blackwell ones, B200s, are sold out. I could have sold them 10 times. We were maybe too fast on giving them away. We should have even, from a pricing, be more aggressive. Anyway, we are where we are. We learned on this one. This is something. We have more challenges, by the way, with the RTX chipsets to sell them. Nevertheless, highly and good utilization of our industrial AI cloud in Munich.

Speaker #4: In line with the demand which we see for sovereign secure and AI-ready infrastructure, which we clearly see here in Europe. I can tell you if you look to our industrial AI cloud, which we have built with NVIDIA, in Munich, the 10,000 GPUs the Blackwell ones B200s are sold out.

Speaker #4: I could have sold them 10 times. That is so it is and we were maybe too fast on giving them away. We should have even from a pricing be more aggressive.

Tim Höttges: I could have sold them 10 times. We were maybe too fast on giving them away. We should have even, from a pricing, be more aggressive. Anyway, we are where we are. We learned on this one. This is something. We have more challenges, by the way, with the RTX chipsets to sell them. Nevertheless, highly and good utilization of our industrial AI cloud in Munich.

Speaker #4: But anyway, we are where we are. We learned on this one, so this is something. We have more challenges, by the way, with the RTX chipsets.

Speaker #4: To sell them, but nevertheless, highly and good utilization of our industrial AI cloud in Munich. So we are thinking about expanding this. There is a capacity of another 20,000 GPUs.

Tim Höttges: We are thinking about expanding this. There's a capacity of another 20,000 GPUs. I was in the Valley with Ferri recently, we discussed how to get the right amount of chipsets there to fulfill that. On top of that, we have seen the documents for the EU Gigafact tender, where we are now assessing our participation. To be honest, I was very critical about the document. At a glance, I can tell you there were significant improvements in this from a pricing perspective. It is not anymore one price. It is now market related. It's not a minimum commitment for a Gigafactory. It is going in steps, being a smaller or bigger one. I think it's around 150 MW they are talking about. I've seen that, to be honest, it's a little bit too early. We have just started looking into this one.

Speaker #4: I was in the valley with Ferry recently. And we discussed how to get the right amount of chipsets there. To fulfill that. And on top of that, we have seen the documents for the EU gigafactory tender.

Speaker #4: Where we are now assessing our participation. To be honest, this I was very critical about the document. At a glance, I can tell you there were significant improvements.

Tim Höttges: At a glance, I can tell you there were significant improvements in this from a pricing perspective. It is not anymore one price. It is now market related. It's not a minimum commitment for a Gigafactory. It is going in steps, being a smaller or bigger one. I think it's around 150 MW they are talking about. I've seen that, to be honest, it's a little bit too early. We have just started looking into this one.

Speaker #4: In this from a pricing perspective, it is not any more one price. It is now market related. It is not a minimum commitment for a giga factory.

Speaker #4: It's going in steps, being smaller or bigger ones. I think it's around 150 megawatts they're talking about. So I’ve seen that. But to be honest, it's a little bit too early.

Speaker #4: We have just started looking into this one. It's one year one week old, this document now. We haven't taken the decision. The principle of what we have laid out, doing this with a financial partner going forward, splitting the real estate and the infrastructure and the cloud.

Tim Höttges: It's one week old, this document now. We haven't taken the decision. The principle of what we have laid out, doing this with a financial partner going forward, splitting the real estate and the infrastructure and the cloud. The idea of saying we do not want to be a host for frontier models alone. We want to have an added value with a cloud service sitting on top of that with an orchestration layer, which is providing the customer needs. The idea of building a full stack, which is sovereign with kind of local basis. Even the discussion about maybe some of the big frontiers models who want to expand into a sovereign ecosystem. What does that mean from a distillation perspective, from a kill switch perspective, from a weights perspective? These are discussions which are ongoing with the frontier models.

Speaker #4: The idea of saying we do not want to be a host for Frontier models alone. We want to have an added value with a cloud service sitting on top of that with an orchestration layer, which is providing the customer needs.

Speaker #4: The idea of building a full stack, which is sovereign with kind of local basis. And even the discussion about maybe some of the big frontiers models, who want to expand into ecosystem, what does that mean from a distillation perspective, from a kill switch perspective, from a weights perspective?

Tim Höttges: The idea of building a full stack, which is sovereign with kind of local basis. Even the discussion about maybe some of the big frontiers models who want to expand into a sovereign ecosystem. What does that mean from a distillation perspective, from a kill switch perspective, from a weights perspective? These are discussions which are ongoing with the frontier models.

Speaker #4: These are discussions which are ongoing. With the Frontier models. But to be honest, I cannot give you a final answer on that one. But I hope that the signal of today is that we are not going into any kind of stupid tenders or stupid if we are not be able to get decent financial returns.

Tim Höttges: To be honest, I cannot give you a final answer on that one. I hope that the signal of today is that we are not going into any kind of stupid tenders or stupid index if we are not be able to get decent financial returns. I'm always surprised that people, shareholders, after following me now for almost 20 years in the role of the CFO and the CEO, that you do not understand how I'm thinking. I'm not tolerating that any business is not making its profits. I'm not tolerating that any business not making its return on capital employed. This is true for the historical business. It's true for our connectivity business. It's true for every segment. It will be true for T-Systems. I can tell you it will be even true for the Gigafactories or for data center capabilities.

Speaker #4: I always surprised that people shareholders after following me now for almost 20 years in the role of the CFO and the CEO, that you do not understand how I'm thinking.

Speaker #4: I'm not tolerating that any business is not making its profits. I'm not tolerating that any business not making its return on capital employeds. And this is true for the historical business.

Tim Höttges: I'm not tolerating that any business is not making its profits. I'm not tolerating that any business not making its return on capital employed. This is true for the historical business. It's true for our connectivity business. It's true for every segment. It will be true for T-Systems. I can tell you it will be even true for the Gigafactories or for data center capabilities.

Speaker #4: It's true for our connectivity business. It's true for every segment. It will be true for T-Systems. And I can tell you it will even be true for the gigafactories or for data center capabilities.

Speaker #4: We are not going into any kind of stupid politically pushed transactions. We will only go into this transaction when we make decent returns on that.

Tim Höttges: We are not going into any kind of stupid politically pushed transactions. We will only go into this transaction where we make decent returns on that.

Speaker #2: Let me try to start with that, answering that second question, which is a very broad one, Akil. First of all, let me rest assure you that decision that we're expanding the share buyback was not an in-year decision.

Tim Höttges: Let me try to start with answering that second question, which is a very broad one, Akhil. First of all, let me rest assure you that decision that we're expanding the share buyback was not an in-year decision. It also reflected what is needed in the future, in the upcoming years, and whether we can afford this, yes or no. We will not compromise on any investment plans which we had. Or for example, on US spectrum auctions which are important, whether it's being the upper C-band or the 2.7 GHz spectrum. Which for me is one of the offense plays I would allude to. Secondly, what you're seeing in the US is they're branching out from the core business, right? We introduced, I think, businesses in the ad space.

Christian Illek: Let me try to start with answering that second question, which is a very broad one, Akhil. First of all, let me rest assure you that decision that we're expanding the share buyback was not an in-year decision. It also reflected what is needed in the future, in the upcoming years, and whether we can afford this, yes or no.

Speaker #2: It also reflected what is needed in the future in the upcoming years. And whether we can afford this, yes or no. And we will not compromise on any investment plans which we had or, for example, on US spectrum auctions which are important, whether it's being the upper C vendor or the 2.7 gigahertz spectrum.

Christian Illek: We will not compromise on any investment plans which we had. Or for example, on US spectrum auctions which are important, whether it's being the upper C-band or the 2.7 GHz spectrum. Which for me is one of the offense plays I would allude to. Secondly, what you're seeing in the US is they're branching out from the core business, right? We introduced, I think, businesses in the ad space.

Speaker #2: Which for me is one of the offense plays I would allude to. Secondly, what you've seen in the US is they're branching out from the core business, right?

Speaker #2: We introduced I think businesses in the ad space. And there were also talking about entering the financial services market. So that is kind of adding new additional growth legs.

Christian Illek: They were also talking about entering the financial services market. That is kind of adding new additional growth legs. I think on the European side, we are using AI currently very broadly to drive efficiencies and to be less dependent on people to run this organization. We're also, I think in Europe, we're making some progress on global scale. For example, we will have one transport network across the European countries. We have basically finalized a big tender in order to secure memory chip supply across all European countries, which came with a significant cost effect. We have now moved from customer-centric measures in order to measure the performance of a network towards technology-centric measures, towards customer-centric measures. We started off with that in the mobile space. We will expand this to TV and broadband.

Speaker #2: I think on the European side, we are using AI currently very broadly to drive efficiencies and to be less dependent on

Speaker #1: On on on on on people to run this organization . And we're also , I think in Europe , we're making some progress on global scale .

Speaker #1: So for example , we will have one transport network across the European countries . , we have basically finalized a big tender in order to secure memory chip supply across all European countries , which came with a significant , , cost effect .

Christian Illek: For example, we will have one transport network across the European countries. We have basically finalized a big tender in order to secure memory chip supply across all European countries, which came with a significant cost effect. We have now moved from customer-centric measures in order to measure the performance of a network towards technology-centric measures, towards customer-centric measures. We started off with that in the mobile space. We will expand this to TV and broadband.

Speaker #1: We have now moved from customer centric measures in order to measure the performance of a network towards customer technology centric measures towards customer centric measures .

Speaker #1: We started off with that in the mobile space . We will expand this to a TV and broadband . So this is I think these are the lines where we are experimenting and where we're trying to figure out whether it's either defensive move , if it's efficiency or whether it's additional growth opportunity for us being at ATS or being at financial services .

Christian Illek: I think these are the lines where we're experimenting and where we're trying to figure out whether it's either defensive move, if it's efficiency, or whether it's additional growth opportunity for us, be it ads or be it financial services.

Speaker #1: Look .

Speaker #2: One one last sentence . Even , you know , , , reflecting it is you cannot look on a share buyback isolated from the needs for the operations .

Tim Höttges: Look, Akhil, one last sentence. Even reflecting, you cannot look on a share buyback isolated from the needs for the operations. We have a need to invest in spectrum. We have a need to sustain our competitiveness on the fiber and the broadband business. We have a need to always be leading on the mobile networks. We have a need to look for future investments, maybe even in the area of data center capacities. We have the need to look on our shares. These are all investment needs, and we have to do, and we look to the mix. This volatility and this discrepancy between the inner value and the growth prospects of this group forced us this time to take a decisive action to buy back this stock. Otherwise, this is a signal which we're doing.

Speaker #2: We have a need to invest in spectrum . We have a need to to sustain our competitiveness on the fibre and the broadband business .

Speaker #2: We have a need to always be leading on the mobile networks . We have a need , , to , , look for future investments , maybe even in the area of , , of data center capacities .

Tim Höttges: We have a need to look for future investments, maybe even in the area of data center capacities. We have the need to look on our shares. These are all investment needs, and we have to do, and we look to the mix. This volatility and this discrepancy between the inner value and the growth prospects of this group forced us this time to take a decisive action to buy back this stock. Otherwise, this is a signal which we're doing.

Speaker #2: And we have the need to look on our shares . These are all investment needs and we have to do , and we look to the mix , but this volatility and this discrepancy between the inner value and the growth prospects of this group forced us this time to take a decisive action to buy back the stock .

Speaker #2: Otherwise , we should we this is a signal which we're doing now . That doesn't mean that we are now going away from our operations or from our business .

Tim Höttges: Now, that doesn't mean that we are now going away from our operations or from our business. The opposite is the case. The luxury which we have compared to all the other telcos is that we have the money. We have an A-minus rating. We have a very, let's say, solid financial reserve in our group, and that is why we took this decision right now. It is not that we are cannibalizing or that we are sacrificing something from our operational perspective. EUR 18 billion investment this year are confirmed.

Speaker #2: The opposite is the case . The luxury which we have compared to all the other telcos , is that we have the money .

Speaker #2: We have an A minus rating . We have a very , let's say , solid , , financial reserve in our group . And that is why we took this decision .

Speaker #2: Right now . , it is not that we are cannibalizing or that we are sacrificing something from our operational perspective . 18 billion investment this year are confirmed

Speaker #3: Great . Thanks . , and , , next up is Paul Bernburg , please .

Hannes Wittig: Great. Thanks, everyone. Next up is Paul Sidney at Bernstein.

Speaker #4: , thank you very much . And good afternoon , everyone . Just two questions for me , please . , the German price increases .

Paul Sidney: Thank you very much, Hannes, and good afternoon, everyone. Just two questions from me, please. The German price increases you put through in H1 seem to have landed really well. You have got the value over volume strategy. I was just wondering, does this give DT more confidence to potentially be even bolder in terms of back book price increases for both broadband and mobile? If we take a step back, everyone is getting a gold-plated service from you for pretty much EUR 1 a day, which feels pretty ridiculous, in my opinion. I am sure you probably share the same view, but just getting your thoughts on that. Just going back to SpaceX. I know we touched on it earlier, but I do not want to get into any details.

Speaker #4: , you put through in H1 seem to have landed really well . You've got the value of volume . , strategy . I was just wondering , does this give DT more confidence to potentially be even bolder in terms of book price increases for both broadband and mobile ?

Speaker #4: I mean , if we take a step back , I mean , everyone's getting a gold plated service from you for pretty much €1 a day , which feels pretty ridiculous in my opinion .

Paul Sidney: If we take a step back, everyone is getting a gold-plated service from you for pretty much EUR 1 a day, which feels pretty ridiculous, in my opinion. I am sure you probably share the same view, but just getting your thoughts on that. Just going back to SpaceX. I know we touched on it earlier, but I do not want to get into any details.

Speaker #4: And I'm sure you probably share the same view , but just , , getting your thoughts on that and , and just going back to space .

Speaker #4: I know we touched on it earlier , but I don't , I don't want to get into any details , but given the more disclosure we've had post the IPO and the Q2 results earlier in the week , has anything surprised you either positively or negatively on the increased information we've had from them ?

Paul Sidney: Given the more disclosure we have had post the IPO and the Q2 results earlier in the week, has anything surprised you either positively or negatively on the increased information we have had from them around the industry, US, Europe? Just be really interesting to get your thoughts. Thank you.

Speaker #4: , around the industry ? , us , Europe , , just be , you know , really interesting to , to get your thoughts .

Speaker #4: Thank you

Speaker #2: Okay . , look on the first thing you know , we have increased our price by €2 per month . On the customer base .

Tim Höttges: Okay. Look, on the first thing, we have increased our price by EUR 2 per month on the customer base. Affected were something like 5 million or 4.9 million customers out of 15. Almost a third. We were expecting a little bit of churn, which we have seen this quarter. To be honest, we are very encouraged by the reaction of the market and the customer base. It shows that this is possible. Kudos to Rodrigo. Kudos to the German team, who were brave enough to move in this right direction here, because it cannot be that we are constantly investing more into the broadband build-out, into fiber, having price increases and the like, but not being able to monetize this over time. Therefore, I think it is a necessity, not only for Deutsche Telekom, it is a necessity for the whole industry.

Speaker #2: Affected were something like 5 million or 4.9 million customers out of 15 . , so , , almost a third , , and , we were expecting a little bit of churn , which we have seen this quarter , , to be honest , we are very encouraged by the reaction of the market and the customer base .

Speaker #2: , so it shows that this is possible . , kudos to Rodrigo . , kudos to the German team . , who were brave enough to , to move in this direction here because it cannot be that we are constantly investing more into the broadband build out into fiber , having price increases and the like , but not being able to monetize this over time .

Tim Höttges: It shows that this is possible. Kudos to Rodrigo. Kudos to the German team, who were brave enough to move in this right direction here, because it cannot be that we are constantly investing more into the broadband build-out, into fiber, having price increases and the like, but not being able to monetize this over time. Therefore, I think it is a necessity, not only for Deutsche Telekom, it is a necessity for the whole industry.

Speaker #2: So therefore , I think it is a necessity not only for Deutsche Telekom and necessity for the whole industry . And therefore , yes , I feel encouraged .

Tim Höttges: Therefore, yes, I feel encouraged from this angle. It would be crazy if not. The second thing is, SpaceX. Any surprises? Look, there is a lot of surprises in this world. Today we solve the indoor coverage. Then I have a sleepless night saying, How is that possible with a satellite? Then I learn something which I would say challenges from a technical perspective. We learn Femtocells is the solution for a mesh network. Okay. To be honest, there are a lot of buzzwords which are flying around these days. As I said, it is a great complementary service. I think the most attractive one is, I think there is a need or there is a business for the fiber, for the broadband services. This is in rural areas where really, let us say, bad coverage is given.

Speaker #2: , from this angle , , it would be crazy if not . , the second thing is , you know , space . , any surprises ?

Speaker #2: Look , there are a lot of surprises in this world , you know , today we solve the indoor coverage , you know , and then I have a sleepless night saying , how is that possible with the satellite ?

Speaker #2: And then I learned , , something which , you know , , I would say challenges from a technical perspective . Then we learn femtocells is the solution for a mesh network .

Tim Höttges: We learn Femtocells is the solution for a mesh network. Okay. To be honest, there are a lot of buzzwords which are flying around these days. As I said, it is a great complementary service. I think the most attractive one is, I think there is a need or there is a business for the fiber, for the broadband services. This is in rural areas where really, let us say, bad coverage is given.

Speaker #2: Okay . To be honest , there are a lot of buzzwords which are , you know , flying around these days . , so therefore , , as I said , it's a great , , complimentary service .

Speaker #2: I think the most attractive one is I think there is a need or there is a business for the fiber for the broadband services .

Speaker #2: , this is in rural areas where really , let's say bad coverage is given . , this is a kind of technology which , , which can work .

Tim Höttges: This is a kind of technology which can work. I can tell you the best, it's not as good as fiber. This is always a superior technology. Therefore, yes, I see that as one. I think the capacity of overbuild and the amount of satellites is something which I'm surprised about. You know what I'm more surprised about? It's not about SpaceX, it's about the catch-up of LEO and the developments which we see from the Amazon side, or even the ambitions from AST. Different technologies, but even very decent capacity they can build. I can tell you there will be not only one satellite player, there will be even a few which we can include into our offerings going forward.

Speaker #2: , I can tell you the best . It's not as good as fiber . , this is always a superior technology . , so therefore .

Speaker #2: Yes , , I see that , , , as , as one , I think , you know , the , the capacity of overbuild and the amount of satellites is something which I'm surprised about .

Speaker #2: And you know what , I'm more surprised about is not about space . It's about the catch up of Leo . And you know , , the developments which we see from the , , on Amazon site or even the ambitions from AST different technologies , but even , you know , very , very decent , , capacity , they can build .

Tim Höttges: You know what I'm more surprised about? It's not about SpaceX, it's about the catch-up of LEO and the developments which we see from the Amazon side, or even the ambitions from AST. Different technologies, but even very decent capacity they can build. I can tell you there will be not only one satellite player, there will be even a few which we can include into our offerings going forward.

Speaker #2: So , , I can tell you there will be not only one satellite player , there will be even a few , , which we can include into our offerings going forward .

Speaker #4: Brilliant . Thank you . Can I just have a very quick follow up ? And have you ever announced the the uplift in app when a customer moves to fiber in Germany ?

Paul Sidney: Brilliant. Thank you. Please can I just have a very quick follow-up? Have you ever announced the uplift in ARPU when a customer moves to fiber in Germany? Apologies if I've missed it.

Speaker #4: Apologies if I've missed it .

Speaker #1: No , we have not .

Speaker #4: Okay . Very clear . Thank you . I appreciate your comments .

Christian Illek: No, we have not.

Paul Sidney: Okay. Very clear. Thank you. I appreciate your comments. Thank you.

Speaker #3: Thank you . The pricing is very similar , right . But what you have to think about is part of the more for more , , ladder and which starts with 5000 to 50 .

Christian Illek: The pricing is very similar, right?

Christian Illek: Okay.

Paul Sidney: Okay.

Christian Illek: What you have to think about is part of the more for more ladder, which starts with 50, 100, 250, then of course, the Super Vectoring comes to its end, then you migrate onto fiber, that's when you get the steady ARPU uplift that we are reporting.

Speaker #3: And then of course , at the super vectoring comes to its end . So then you migrate onto fiber and that's when you get , , the steady rpu uplift .

Speaker #3: , that we are reporting .

Speaker #2: And the upper uplift is something 2.8% .

Tim Höttges: The ARPU uplift is something 2.8%, correct?

Speaker #3: It's around three . Yeah , around 3% for consumers .

Christian Illek: It's around three. Yeah. Around 3% for consumers, yeah.

Speaker #2: Upper uplift .

Christian Illek: It's around 3% ARPA uplift.

Speaker #3: Yeah , no , it's not only fiber , it's just part of that overall upselling funnel , which has , of course , many , many years to go , okay , next .

Christian Illek: It's not only fiber. Yeah. No, it's not only fiber.

Tim Höttges: It's not only fiber. Yeah.

Christian Illek: No, it's not only fiber.

Christian Illek: Okay.

Christian Illek: It's just part of that overall upselling funnel, which has, of course, many years to go. Okay. Next up is.

Speaker #3: , thank you . Is thank you . Thank you Paul . , next up is Paulo at UBS . Please .

Paul Sidney: Thank you.

Hannes Wittig: Thank you. Thanks. You, Paul. Next up is Polo at UBS, please.

Speaker #5: , hi . Thanks for taking the questions . I have two the first one is you previously flagged €15 billion of headroom at the DC level , where you could either increase your stake at t miss do buybacks , the debt level , or do other things .

[Analyst] (UBS): Hi. Thanks for taking the questions. I have two. The first one is, you previously flagged EUR 15 billion of headroom at the DT level, where you could either increase your stake at TMUS, do buybacks at the DT level, or do other things. How much headroom do you have left on your balance sheet? Would there be scope for further buybacks at the DT level in 2027? You also mentioned US spectrum auction as an opportunity to extend your US network leadership position. How do you think about your network position if you don't get any additional spectrum? My second question is really just about Germany. Have you seen any notable changes in competitive dynamics for the mobile market? I know you referenced broadband.

Polo Tang: Hi. Thanks for taking the questions. I have two. The first one is, you previously flagged EUR 15 billion of headroom at the DT level, where you could either increase your stake at TMUS, do buybacks at the DT level, or do other things. How much headroom do you have left on your balance sheet? Would there be scope for further buybacks at the DT level in 2027?

Speaker #5: But how much headroom do you have left on your balance sheet, and would there be scope for further buybacks at the DC level in 2027?

Speaker #5: You also mentioned the US spectrum Auctions and opportunity to extend your US network leadership position . But how do you think about your network position ?

Polo Tang: You also mentioned US spectrum auction as an opportunity to extend your US network leadership position. How do you think about your network position if you don't get any additional spectrum? My second question is really just about Germany. Have you seen any notable changes in competitive dynamics for the mobile market? I know you referenced broadband.

Speaker #5: If you don't get any additional spectrum ? My second question is really just about Germany . , so have you seen any notable changes in competitor dynamics for the mobile market ?

Speaker #5: I know you referenced broadband . The only reason why I'm asking about the German mobile market is because one on , one on their call earlier mentioned that they were removing all tariffs below €6.99 , but also reducing the data allowance in their higher tier bundles .

[Analyst] (UBS): The only reason why I'm asking about the German mobile market is because 1&1 on their call earlier mentioned that they were removing all tariffs below EUR 6.99, also reducing the data allowance in their higher tier bundles. I'm just wondering sort of what you have seen in terms of German mobile. Thanks.

Polo Tang: The only reason why I'm asking about the German mobile market is because 1&1 on their call earlier mentioned that they were removing all tariffs below EUR 6.99, also reducing the data allowance in their higher tier bundles. I'm just wondering sort of what you have seen in terms of German mobile. Thanks.

Speaker #5: So I'm just wondering what you have seen in terms of German mobile banks .

Speaker #2: Although the answer to number one is very clear . , if you look to what we by the way , we have talked about some headroom .

Tim Höttges: Polo, the answer to number one is very clear. By the way, we have talked about some headroom. We're talking about our financial capabilities, and we have something in our planning, which is always anticipated with regards to spectrum, which you don't know. I can tell you one thing. We do not see us getting out of the auctions, which are coming without any spectrum. We have saved money now in the AWS-3 auction. We thought it would be more expensive for what we were aiming for. We got what we wanted for EUR 300 million, with clearly more money in mind. Nevertheless, this is good for the group. Nevertheless, I'm very optimistic that we are safeguard and prepared very well for the upcoming auctions. Both from the C-band and from the 2.7 GHz perspective.

Speaker #2: We're talking about our financial capabilities and we have something in our planning , which is always anticipated with regard to , , spectrum , which you don't know .

Speaker #2: , so I can tell you one thing we do not see us , you know , getting out of the auctions , which are coming without any spectrum .

Speaker #2: We have saved money now in the AWS three auction . We thought , you know , it would be more expensive for what we were aiming for .

Tim Höttges: We thought it would be more expensive for what we were aiming for. We got what we wanted for EUR 300 million, with clearly more money in mind. Nevertheless, this is good for the group. Nevertheless, I'm very optimistic that we are safeguard and prepared very well for the upcoming auctions. Both from the C-band and from the 2.7 GHz perspective.

Speaker #2: We got what we wanted for 300 million . We had more money in mind , but nevertheless , this is good for , for the group .

Speaker #2: Nevertheless , you know , I'm very optimistic that we are safeguard and prepared . a very well for the , , for the upcoming auctions , , both from , , from the C-band and from the 2.7GHz perspective .

Speaker #1: Can I , can I comment on this one ? Please go ahead . Yeah . Look , there were two , I think there was an implicit question whether we need to , to buy additional spectrum .

Christian Illek: Can I comment on this one?

Paul Sidney: Please go ahead.

Tim Höttges: Please go ahead.

Christian Illek: Yeah. Look, Polo, I think there was an implicit question whether we need to buy additional spectrum. I'm not sure whether you're alluding to Fixed Wireless Access. The 18 to 19 billion broadband customers, which is obviously a combination of fixed wireless and fiber, are calculated without any additional spectrum. Whatever is going to be the outcome of the upper C-band and especially the 2.7, obviously gives scope for more, but it's not necessary to basically achieve the targets which we have articulated. For the buybacks for 2027, I think we usually have a cadence. It's more around Q3 where we make a statement regarding dividend and buyback. I think it's too early to talk about this today.

Speaker #1: I'm not sure whether you're alluding to fixed wireless access . The 18 to 19 billion broadband customers , which is obviously a combination of fixed wireless and fibre , are calculated without any additional spectrum .

Speaker #1: So , , whatever is going to be the outcome of the upper C-band and especially 2.7 , obviously gives scope for more , but it's not necessary to basically , , achieve the targets which we have articulated .

Christian Illek: Whatever is going to be the outcome of the upper C-band and especially the 2.7, obviously gives scope for more, but it's not necessary to basically achieve the targets which we have articulated. For the buybacks for 2027, I think we usually have a cadence. It's more around Q3 where we make a statement regarding dividend and buyback. I think it's too early to talk about this today.

Speaker #1: And for the buybacks for 27 , I think we usually have a cadence . It's more around , , Q3 where we make a statement regarding dividend and buybacks .

Speaker #1: So I think it's too early to talk about this today .

Speaker #2: And then on the German , , competitive dynamics in the market , , look , , we have seen a shift towards more stable pricing , , in our German market .

Tim Höttges: On the German competitive dynamics in the market. Look, we have seen a shift towards more stable pricing in our German market. We have even a list of price increases from all carriers after all this kind of price deflation we have seen previously. However, I can tell you the environment remains highly promotional. There are always promotions out there and discounts and the like. 1&1 has made some changes as of July 2026. The lowest price is the EUR 6.99, you're correct. Effectively, let's say, this is removing some tariffs below this price point. To be honest, it's too early to say how the market is looking to this one. Other operators, by the way, O2, Vodafone, even us, we have implemented price increases in the market.

Speaker #2: , and we have even , you know , a list of , of price increases from all carriers . , after all this kind of price deflation , we have seen previously .

Speaker #2: , however , I can tell you the environment remains highly promotional . , so , so there are always promotions out there and discounts and the like .

Tim Höttges: There are always promotions out there and discounts and the like. 1&1 has made some changes as of July 2026. The lowest price is the EUR 6.99, you're correct. Effectively, let's say, this is removing some tariffs below this price point. To be honest, it's too early to say how the market is looking to this one. Other operators, by the way, O2, Vodafone, even us, we have implemented price increases in the market.

Speaker #2: , and , has made some changes , , as of July 2026 , , the lowest price is the 6.99 . You're correct .

Speaker #2: Effectively , let's say this is , removing some tariffs , , below this point price point . , but , to be honest , it's too early to say , you know , how , how the market is looking to this one .

Speaker #2: Other operators , by the way , O2 , Vodafone , , or even us , you know , we have implemented price increases in the market .

Speaker #2: , we have refreshed our portfolios with new tariff grids , , higher entry level prices and with the more for more logic . So , , I would say despite this kind of , you know , , development here , , I do not see that the overall market , the relevant market is , is now going in the wrong direction .

Tim Höttges: We have refreshed our portfolios with new tariff grids, higher entry-level prices, and with the more for more logic. I would say despite this kind of development here, I do not see that the overall market, the relevant market, is now going in the wrong direction. Please consider as well that 1&1's price development, they are always taking place between Vodafone and O2, and less affected us more than on the side of congstar or fraenk. Therefore, I would say it is not affecting the telecom main brand that much.

Speaker #2: , please consider as well that eins and eins , , price developments , they're always taking place between Vodafone and between , , O2 , , and less reflected , you know , affected us , more than on the side of Costa or re franc .

Speaker #2: so therefore , you know , I would say it's not affecting the telecom main brand , that much .

Speaker #3: Yes . And you saw our results of the quarter with the 218 000 . , phone net adds also , to your first question , we are not quantifying the residual headroom from the 15 billion , but the buyback announced today fits well into the framework .

Hannes Wittig: Yes, you saw our results-

Christian Illek: Yes, you saw our results

Tim Höttges: Clear

Christian Illek: of the quarter with the 218,000 phone net adds and also, Polo, to your first question, we are not quantifying the residual headroom from the EUR 15 billion, but the buyback announced today fits well into the framework and without quantifying it, yes, there is some headroom left.

Speaker #3: And , you know , without quantifying it , yes , there is some headroom left . .

Speaker #2: By the way , guys , it's funny to see , Orkla we just got awarded 1111 awards out of 11 . So , , and there's another one coming for Europe for , you know , the best network in Europe .

Tim Höttges: By the way, guys, it is funny to see, umlaut, we just got awarded 11 awards out of 11. There is another one coming for Europe for the best network in Europe, which is for the first time, going to the There is, and this is good. It is not all about price. It is about quality. We are quality leader. Is there any question in this room? Is there any question from the owners of that company that we are not leading by quality? This is what we are monetizing. Look, I know I am repeating myself, but this is our protection against EUR 699.

Speaker #2: , which is for the first time , you know , going to there is and this is good . It's not all about price .

Speaker #2: It's about quality , quality . And we are quality leader . Is there any question in this room ? Is there any question from the owners of that company that we are not leading by quality ?

Speaker #2: And this is what we are monetizing ? , look , I'm no , I'm repeating myself , but this is our protection against 6.99 .

Speaker #3: Great . , I think next up is , is David right at bank of America ? David .

Hannes Wittig: Great. I think next up is David Wright at Bank of America. David?

Speaker #4: Yeah . Thank you . I hope you can hear me . I'm sorry . In the video today . , I guess Tim and Christian , , I just wanted to , I guess respectfully , but robustly challenge you .

David Wright: Yeah, thank you. I hope you can hear me. I'm sorry, no video today. I guess, Tim and Christian, I just wanted to, I guess, respectfully but robustly challenge you. You've announced a significant increase to buyback, but you are part of the biggest economy in Europe, and you have lagging fiber coverage versus other European markets. I do accept that the demand curve in Germany is low because the copper quality is high, but there are so many other factors here. It is the obvious defensive mechanism against satellite. I think you would agree that maybe focusing on urban build has meant that there is some fiber build in rural Germany that has impacted your customer share, has impacted pricing.

Speaker #4: , you've announced a significant increase to buyback , but you are part of the biggest economy in Europe and you have lagging fiber coverage versus other European markets .

Speaker #4: Now , I do accept that the demand curve in Germany is low because the copper quality is high . But there are so many other factors here .

David Wright: I do accept that the demand curve in Germany is low because the copper quality is high, but there are so many other factors here. It is the obvious defensive mechanism against satellite. I think you would agree that maybe focusing on urban build has meant that there is some fiber build in rural Germany that has impacted your customer share, has impacted pricing.

Speaker #4: , it is the obvious defensive mechanism against satellite . I think you would agree that maybe focusing on urban build has meant that there is some fiber build in rural Germany that has impacted your customer share , has impacted pricing .

Speaker #4: So I'm just curious that you chose to focus on the fly back more than essentially critical infrastructure . That is the absolute defense and , , superior advantage you have over your competition .

David Wright: I'm just curious that you chose to focus on the buyback more than essentially critical infrastructure that is the absolute defense and superior advantage you have over your competition. That's question one, and I hope I presented that respectfully. Then question two is, you have increased your buyback. Do you have any idea whether the German government would participate or not? The only reason I ask is that we've just seen the French government sell some shares. We've seen the French government sell 3% of Orange. The German government obviously is seeing a shareholding that is increasing with an accelerated buyback. I just wondered if there was any conversations with them. Thank you very much.

Speaker #4: That's question one . And I hope I presented that respectfully . And then question two is , , you have increased your buyback .

Speaker #4: , do you have any idea whether the German government would participate or not ? And the only reason I ask is that we've just seen the French government .

David Wright: The only reason I ask is that we've just seen the French government sell some shares. We've seen the French government sell 3% of Orange. The German government obviously is seeing a shareholding that is increasing with an accelerated buyback. I just wondered if there was any conversations with them. Thank you very much.

Speaker #4: , sell some shares . We've seen the French government sell a 3% of orange , the German government obviously is , , is seeing a shareholding that is increasing with an accelerated buyback .

Speaker #4: I just wondered if there was any commentary or conversations with them . Thank you very much .

Speaker #2: Look to the second question . To be honest . You know , , I don't we don't know , but , , if you ask me and my personal , , gut on this one , , the German government feels very comfortable with their position today .

Tim Höttges: Look, to the second question, to be honest, we don't know. If you ask me and my personal gut feeling here on this one, the German government feels very comfortable with their position today. I do not see then that they are selling out shares at that point in time. Whether they're participating or not, I cannot tell you. This is something you have to ask them. They like the shareholding.

Speaker #2: , I do not see them that they are selling out , you know , shares at that point in time , whether they're participating or not .

Speaker #2: I cannot tell you , , so , , this is something you have to ask them . , but , , they like the shareholding .

Speaker #3: Well , if you look at the ongoing share buyback , you can see actually how the share ownership has developed . And you know , that answers your question retrospectively .

Christian Illek: Well, if you look at the ongoing share buyback, you can see actually how their share ownership has developed. That answers your question retrospectively. It doesn't answer your question going forward.

Speaker #3: It doesn't answer your question going forward .

Speaker #2: And now on the second question , maybe , Christiane , you

Tim Höttges: Now on the second question, maybe Christian, are you going to answer that one?

Speaker #1: Should start or do you want to start ?

Christian Illek: Shall I start or you want to start?

Speaker #2: Maybe I start with the general statement . Then you go into the details of it , because there are little because I think , David , , I respect entirely your challenge .

Tim Höttges: No, maybe I start with the general statement.

Christian Illek: Yeah

Christian Illek: You go into the details of it because there are a little. I think, David, I respect entirely your challenge. To be honest, I feel this challenge in me every single day. Should we go for more investments into businesses? Should we go for stepping up on data center? Should we stepping up in fiber? Should we go and spend? This time, I'm very clear. It's time that we are now thinking about our stocks and thinking about our shareholders, in this regard, when the discrepancy between, let's say, the market and the stock is that big. We cannot accelerate at that point in time the fiber expansion. We have already challenged that the take-up rates in the German market are low. We are well on track with the execution. Don't forget, last year, we took the decision the other way.

Tim Höttges: You go into the details of it because there are a little. I think, David, I respect entirely your challenge. To be honest, I feel this challenge in me every single day. Should we go for more investments into businesses? Should we go for stepping up on data center? Should we stepping up in fiber? Should we go and spend?

Speaker #2: And to be honest , I feel this challenge in me every single day . Should we go for more investments into businesses ? Should we go for stepping up on data centers ?

Speaker #2: Should we stepping up in fiber ? Should we go and go and spend ? But this time I'm , I'm very clear . It's time that we are now thinking about our stocks and thinking about our shareholders in this regard .

Tim Höttges: This time, I'm very clear. It's time that we are now thinking about our stocks and thinking about our shareholders, in this regard, when the discrepancy between, let's say, the market and the stock is that big. We cannot accelerate at that point in time the fiber expansion. We have already challenged that the take-up rates in the German market are low. We are well on track with the execution. Don't forget, last year, we took the decision the other way.

Speaker #2: When the discrepancy between , let's say , the market and the stock is that big . Now , , we cannot accelerate at that point in time .

Speaker #2: , the , the , the fiber expansion , we have already a challenge that , you know , the take up rates in the German market are lowered .

Speaker #2: We are on well on track with the execution and don't forget , last year we took the decision in the other way . We're increased our share buy back initiatives .

Tim Höttges: We not increased our share buyback initiatives. We increased our investment into the fiber. The small devil in me is always sitting on one side or the other side. This time, he was sitting and saying, I have to consider this discrepancy on the stock side.

Speaker #2: We increased our investments into the fiber . So you know , the the , the small devil in me , you know , is always sitting on one side or the other side .

Speaker #2: And this time I'm he was sitting and saying , I have to consider , you know , this discrepancy on the on , on , on , on the stock side .

Speaker #1: Look , let me continue what you said . , I think it's a fair challenge , David . But to be honest , we're feeling quite comfortable with the 2.5 million homes passed .

Christian Illek: Look, let me continue what you said. I think it's a fair challenge, David. To be honest, we're feeling quite comfortable with the two and a half million homes passed. The reason being is if you expand this by another 20%, it's not like that the cost is basically moving in a linear fashion. It's exponentially increasing because of the lack of construction capacity. What we've done is, let me remind you, we have reallocated EUR 400 million on an annual basis into fiber, and predominantly by having a stronger SDU focus and a stronger connections focus. The full build-out of the MDUs is one of the highlights of the change of the fiber build-out strategy. That looks like it's getting traction. You see that actually, we're increasing both the net adds and fiber, as well as utilization overall.

Speaker #1: And the reason being is, if you expand this by another 20%, it's not like that. The cost is basically moving in a linear fashion.

Speaker #1: It's expensive , exponentially increasing because of the lack of construction . , capacity . And what we've done is let me remind you , we have reallocated 400 million on an annual basis into fiber and predominantly by having a stronger SDU focus and a stronger connection focus .

Christian Illek: What we've done is, let me remind you, we have reallocated EUR 400 million on an annual basis into fiber, and predominantly by having a stronger SDU focus and a stronger connections focus. The full build-out of the MDUs is one of the highlights of the change of the fiber build-out strategy. That looks like it's getting traction. You see that actually, we're increasing both the net adds and fiber, as well as utilization overall.

Speaker #1: The full buildout of the Mdus is one of the the highlights of the change of the fiber buildout strategy that looks like it's it's getting traction .

Speaker #1: You see that actually , we're increasing both . The net and fiber . , as well as utilization . , overall , , and I think , , so far we're feeling quite comfortable with the approach , which we have taken with the amount of spend , which we have in fiber , , and as Tim said , the volatility of the share price actually led to the decision that we basically , , prefer share buybacks right now over fiber and , , to spend even more into , into that fiber business case .

Christian Illek: I think so far we're feeling quite comfortable with the approach which we have taken, with the amount of spend which we have in fiber. As Tim said, the volatility of the share price actually led to the decision that we basically prefer share buybacks right now over fiber, and to spend even more into that fiber business case.

Speaker #1: Good .

Speaker #4: Thank you very much .

Hannes Wittig: Thank you very much.

David Wright: Thank you very much.

Speaker #3: Okay . Great . , I think next up is James . James Ratzer at New Street , please . James

Hannes Wittig: Okay, great. I think next up is James. James Ratzer at New Street, please. James.

Speaker #6: Yes . Good afternoon . Thank you for taking the question . So couple from me , please . So the first one I know you can't comment on any kind of M&A speculation at the moment , but there was an article in the press , a week ago , , which said , you know , talks about doing a deal with , T-Mobile might not have found favor with the US government for a specific reason around a review and cash flow from the US business remaining within the US .

James Ratzer: Yes, good afternoon. Thank you for taking the question. Couple from me, please. The first one, I know you can't comment on any kind of M&A speculation at the moment, but there was an article in the press a week ago, which said, talks about doing a deal with T-Mobile might not have found favor with the US government for a specific reason around a CFIUS review and cash flow from the US business remaining within the US. Therefore, my question is, have you therefore ever had discussions with CFIUS about the dividends from T-Mobile US coming back to Germany? Whether there's a deal or no deal, does this potentially act as some kind of limit on the dividends that T-Mobile US could pay back to Deutsche Telekom over the medium to longer term? The second questions I had were on satellite, I'm afraid.

Speaker #6: So therefore , kind of , I suppose my question is , have you therefore ever had discussions with CFIUS about the dividends from T-Mobile USA coming back to Germany and whether there's a deal or no deal , you know , does this potentially act as some kind of limit on the dividends that T-Mobile US could pay back to Deutsche Telekom over the medium to longer term ?

James Ratzer: Therefore, my question is, have you therefore ever had discussions with CFIUS about the dividends from T-Mobile US coming back to Germany? Whether there's a deal or no deal, does this potentially act as some kind of limit on the dividends that T-Mobile US could pay back to Deutsche Telekom over the medium to longer term? The second questions I had were on satellite, I'm afraid.

Speaker #6: And then the second question I had were on satellite . I'm afraid , , so quick fire one is , are you one of the proxy or the parties that was mentioned in the proxy filing for Globalstar ?

James Ratzer: Quick-fire one is, are you one of the proxy or the parties that was mentioned in the proxy filing for Globalstar? Are you willing to comment on whether you had interest in buying Globalstar? Are you interested in buying MSS Spectrum or partnering with other satellite players? In Germany, since we last spoke at the Q1 earnings call, it looks like SpaceX's access to the S-band spectrum in Germany is likely to be heavily reduced now down to a kind of maximum of 10MHz. How does that affect your relationship with them and ability to offer a D2C service in Germany and the rest of Europe?

Speaker #6: Are you willing to comment on whether you had interested in buying Globalstar ? Are you interested in buying mass spectrum or partnering with other satellite players ?

Speaker #6: And in Germany , since we last spoke at the Q1 earnings call , it looks like SpaceX is access to the S-band spectrum in Germany is likely to be heavily reduced now down to kind of maximum of ten megahertz .

Speaker #6: How does that affect your relationship with them and ability to offer a D to see service in Germany and the rest of Europe

Speaker #2: , look again , two question number one , I'm not , you know , , commenting on any kind of speculations , , with regard to commentaries from the press , but nevertheless , I can say one thing I have never , ever , never , ever heard about , let's say a concern with CFIUS about dividends .

Tim Höttges: Look, again, to question 1. I'm not commenting on any kind of speculations with regard to commentaries from the press. Nevertheless, I can say one thing. I have never, ever heard about, let's say, a concern with CFIUS about dividends. I never heard about, let's say, any concerns that the US government is not supporting us in this regard. Therefore, this is the, with regard to our business, with regard to our relationship, never ever something which came up to me.

Speaker #2: I never heard about , let's say any concerns that the US government is not supporting us in this regard . So therefore , this is the with regard to our business , with regard to our relationship , never ever , you know , something which came up to me With regard to the second topic , , look , , the issue is , you know , by the way , there's even the second topic is , you know , what is happening with this EchoStar spectrum , which , you know , has basically has bought , we thought , you know , they can use it .

James Ratzer: Right.

Tim Höttges: With regard to the topic 2, look, the issue is, by the way, there is even the topic 2 is, what is happening with this EchoStar spectrum, which SpaceX has bought. We thought they can use it, and then we have a Gen 2 service on our D2D device in 2027 or 2028 already. That is, let's say that was the original planning. Now we hear that there might be some limitations to approvals from the European government side here. This is something which is new. The topic 2 is, yes, there are discussions about, let's say, how much spectrum is going to be available for American or for independent satellite operators. To be honest, this is a political decision. It is a European decision. It's a little bit, let's say, looks a little bit protectionistic if we do it that way.

Speaker #2: And then we have a Gen two service on our D2D devices . , in 2027 or 8 already , you know , so that is let's say the , that was the original planning .

Tim Höttges: hat is, let's say that was the original planning. Now we hear that there might be some limitations to approvals from the European government side here. This is something which is new. The topic 2 is, yes, there are discussions about, let's say, how much spectrum is going to be available for American or for independent satellite operators. To be honest, this is a political decision. It is a European decision. It's a little bit, let's say, looks a little bit protectionistic if we do it that way.

Speaker #2: Now we , we hear that there might be some limitations due to approval from the European government side here . , this is something which , , which is new .

Speaker #2: And the second topic is . Yes . , there are discussions about , let's say how much spectrum is going to be available for , , , American or for independent satellite operators , to be honest , you know , , this is a political decision .

Speaker #2: , , it is a European decision . , it's a little bit , let's say , , looks a little bit protectionist if we , if we do it that way , I'm always , you know , in favor of market dynamics here .

Tim Höttges: I'm always in favor of market dynamics here. Nevertheless, we have to manage that. As we have said, SpaceX is our partner, and we would love to launch with them. Nevertheless, if the spectrum is not with them, there might be others who are using it.

Speaker #2: , but nevertheless , you know , we have to manage that . As we have said , you know , space is our partner and we would love to launch with them .

Speaker #2: , but nevertheless , you know , if the spectrum is not with them , there might be others who are using it

Speaker #3: Okay . I with that next , , we move to , , actually Andrew Lee on the , , he sent his questions by email because he had , , connection issues .

Hannes Wittig: Okay. With that, next, we move to, actually, Andrew Lee. He will send his questions by email because he had connection issues. He asked satellite risk US versus Europe. There's a perception that US fixed broadband telco is under more risk from satellite competition than Europe because of weaker broadband speeds and higher broadband prices. This could then produce more of a platform under the Starlink plans discussed yesterday to use those broadband receivers. Do you see the US more at risk than Europe?

Speaker #3: , , he asked satellite risk us versus Europe . , there's a perception that us fixed broadband telco is under more risk from satellite competition than Europe because of weaker broadband speeds and higher broadband prices .

Speaker #3: This could then produce more of a platform under the , , Starlink plans discussed yesterday to use those broadband receivers . Do you see the US more at risk than Europe Maybe to start off , , answering this , I mean , the so fiber penetration in the US is a little bit lower , but cable penetration is a bit more pervasive .

Tim Höttges: Okay. Maybe to start off answering this. Fiber penetration in the US is a little bit lower, but cable penetration is a bit more pervasive. Of course, there's a very strong Fixed Wireless Access connectivity that we provide. Fixed Wireless is a substantially and very significantly more powerful technology than satellites. We are very confident that Fixed Wireless is the superior technology in most locations. Of course, there are locations in the US which are not served by terrestrial mobile networks. Those situations can be interesting for satellite broadband.

Speaker #3: And of course , there's a very strong fixed wireless access connectivity that we provide . And , you know , fixed wireless is a substantially and , , very significantly more powerful technology than satellites .

Speaker #3: So we are very confident that fixed wireless is , , is the superior technology in most locations . But of course , there are locations in the US which are not served by terrestrial mobile networks .

Speaker #3: , and those situations can be interesting for satellite broadband .

Speaker #1: I would add two things from the US side on fixed wireless access . First of all , the download speed , which we're having right now in the US , is significantly higher than you would have it on satellite .

Christian Illek: Look, I would add two things from the US side on Fixed Wireless Access. First of all, the download speed, which we're having right now in the US, is significantly higher than you would have it on satellite. Therefore, the question is Fixed Wireless Access still superior versus satellite? I would say yes. Two-thirds of our 5G broadband customers are coming from top 100 markets. We don't have an overexposure to rural areas where I think is a sweet spot for satellite broadband. On D2D, I think Tim said everything. It's complementary. The next question from Andrew is: Why allocate capital DT rather than T-Mobile? I'm the last. Sorry, not sure if this is properly transcribed. DT ex US stock as guide in where there is most value, but the stock is trading towards more expensive end of historical range.

Speaker #1: So therefore , the question is , , is fixed wireless access still superior versus satellite . I would say I would say yes .

Speaker #1: And two thirds of our broadband customers 5G broadband customers are coming from . Top 100 markets . So , , so we don't , we don't have an overexposure to rural areas where I think is a sweet spot for satellite broadband .

Christian Illek: We don't have an overexposure to rural areas where I think is a sweet spot for satellite broadband. On D2D, I think Tim said everything. It's complementary. The next question from Andrew is: Why allocate capital DT rather than T-Mobile? I'm the last. Sorry, not sure if this is properly transcribed. DT ex US stock as guide in where there is most value, but the stock is trading towards more expensive end of historical range.

Speaker #1: And on D2DI think Tim said everything is complimentary .

Speaker #3: The next question from Andrew is: why?

Speaker #1: Allocate capital Pte rather than T mobile ? I'm the last you've used . , so I'm not sure if there's a properly transcribed Pte used as a guide in whether there is most value .

Speaker #1: But the stock is trading towards more expensive end of historical range . This would historically have suggested opportunity to invest in T-Mobile over the T .

Christian Illek: This would historically have suggested opportunity to invest in T-Mobile over DT. Why not now? T-Mobile has been volatile too. We have pointed out before, we are not participating in the T-Mobile share buyback this year, so we are effectively buying T-Mobile, and now we are buying DT, too. There's no contradiction. Of course, if you buy DT in terms of the share of the total profit, a large chunk of that comes from T-Mobile, so we're buying T-Mobile profitability to drive the accretion.

Speaker #1: Not now . T-Mobile has been volatile too . But you know , we have pointed out before , we are not participating in the T share buyback this year .

Speaker #1: So we are effectively buying T-Mobile . And now we are buying DT two . There's no contradiction . And of course , if you buy BT .

Speaker #1: In terms of the share of the total profit , , a large chunk of that comes from T-Mobile . So we're buying T-Mobile profitability to drive the accretion

Speaker #2: And the undervaluation . And the undervaluation of the DT stock compared to the US stock is higher . So therefore , you know , the investments into the DD stock is more attractive .

Tim Höttges: The undervaluation of the DT stock compared to the US stock is higher. Therefore, the investment into the DT stock is more attractive.

Speaker #1: Okay . I think this brings us actually to the end of today's , , , call . So , , thanks everybody . Thank you very much for your participation and your continued interest in Deutsche Telekom .

Hannes Wittig: Okay. I think this brings us actually to the end of today's call. Thanks, everybody. Thank you very much for your participation and your continued interest in Deutsche Telekom. Should you have any further questions, please do not hesitate to contact our investor relations team. We wish you a pleasant day and nice summer, and we look forward to speaking with you again soon. Thank you, guys.

Speaker #1: And should you have any further questions , please do not hesitate to contact our Investor Relations team . We wish you a pleasant day , a nice summer , and we look forward to speaking with you again soon .

Speaker #1: Thank you guys . Thank you .

Tim Höttges: Thank you.

[Company Representative] (Deutsche Telekom): Bye-bye.

Christian Illek: Bye-bye.