Deutsche Telekom (ETR:DTE) used its annual general meeting in Bonn to outline an artificial intelligence-focused expansion strategy alongside updated shareholder returns and governance measures, after reporting what CEO Timotheus Höttges called “yet another record year” in 2025.
Management spotlights “Industrial AI Cloud” and sovereign infrastructure
In his address to shareholders, Höttges presented Deutsche Telekom’s “Industrial AI Cloud” as a new business field intended to support German and European industrial AI use cases with what he described as “unbeatable connectivity,” “maximum security,” and “sovereignty.” He said the platform was built with partners in six months and is already in operation using “100% renewable energy.”
During the meeting, Deutsche Telekom connected live to an underground section of its AI computing center in Munich. A Deutsche Telekom representative in Munich described the environment as extremely loud due to ventilation, noting the installation contained hundreds of GPUs in a pod.
Later in the Q&A, Höttges said the AI factory had been running for three months, had won several customers, and was “40%” utilized at that time. He credited T-Systems, led by “Fabiara Hassan,” with delivering the project in six months “from the idea to the realization.”
2025 results and 2026 outlook: growth, investment and dividend proposal
Höttges said 2025 marked a 48th consecutive quarter of growth. He reported that revenue rose 4.2% to more than EUR 119 billion, earnings increased 4.7% to more than EUR 44.2 billion, free cash flow rose 2% to EUR 19.5 billion, and earnings per share increased 5.2% to EUR 2 per share.
He also emphasized network investment, describing Deutsche Telekom’s strategy as a “flywheel” that begins with investing more than competitors. Höttges said the group invested EUR 16.9 billion last year and added 10 million customers.
For 2026, Höttges said Deutsche Telekom expects adjusted earnings to rise 6% to EUR 47.4 billion, free cash flow to increase 3% to EUR 19.8 billion, and earnings per share to rise 10% to EUR 2.20. He reiterated the company’s payout approach, stating that 40% to 60% of results are intended for shareholder distributions. Management proposed a dividend of EUR 1 per dividend-bearing share, which Höttges characterized as the highest in the company’s history.
Network build-out, satellites and regulatory concerns
Höttges outlined progress in fiber and mobile expansion. In Germany, he cited 12.6 million homes passed with fiber, an increase of 2.5 million year over year, and reiterated a target of 25 million homes by 2030. He also described 5G coverage across Germany and said Deutsche Telekom continues to win network tests.
He said Deutsche Telekom plans to “enhanc[e] our mobile network with satellite tech connectivity from 2027 on,” citing hard-to-reach locations and permitting challenges. In Q&A, he described satellite connectivity as an “addition” to terrestrial networks, referencing a partnership with Starlink in the U.S. initiated in 2024 and expanded to Europe. He said direct-to-device satellite features would likely be integrated into devices in a “next generation” around 2028.
Höttges also criticized aspects of telecommunications regulation, including proposals around copper network shutdowns in Germany and what he called additional red tape in Europe. He argued Europe needs scale and consolidation, advocating “same services, the same rules” across regulated telecoms and unregulated over-the-top providers and satellite operators.
Capital allocation: buybacks, leverage and investment priorities
Chief Financial Officer Christian Illek provided details on Deutsche Telekom’s share buyback activity. He said the 2025 buyback program ran from January 5 to December 11, 2025, with 65,412,156 shares repurchased at an average price of EUR 30.58 for a total of EUR 1,999,999,212, representing about 1.3% of share capital. Illek said most shares will be redeemed at year-end to mitigate dilution, with some used for executive compensation and employee programs.
For 2026, Illek said Deutsche Telekom announced a continued buyback program with a first tranche of up to EUR 2 billion. He said that tranche ran from January 5 to March 26, 2026, with 15,598,603 shares repurchased at an average price of EUR 30.22 for EUR 471,302,675.54, representing about 0.32% of share capital. He said most of those shares would be redeemed in the coming year to mitigate dilution from the 2021 capital increase, consistent with capital allocation plans discussed at Capital Markets Day 2024.
In response to shareholder questions, Illek said the group targets a net debt ratio of 2.5, noting it was “2.62” at year-end. He said investment competitiveness remains the top priority, with 21% of service revenue earmarked for reinvestment, and reiterated the dividend policy of 40% to 60% of adjusted earnings per share. He added that Deutsche Telekom does not discuss M&A “too early,” stating shareholders should not expect “any major acquisitions right now.”
Governance, personnel changes, and AGM votes
Supervisory Board Chair Frank Appel reported the board held 36 meetings in 2025, with a 97% participation rate, and said the auditor issued unqualified opinions on annual and consolidated statements. Appel said the Supervisory Board saw no reason to doubt the effectiveness of internal controls and risk management.
Appel also addressed leadership changes. He said Höttges was reappointed until the end of 2028. He reported that Claudia Nemat departed the Management Board at the end of September 2025 and that Dr. Abdurazak Mudesir, appointed effective October 1, 2025, had asked to terminate his mandate “with immediate effect” in 2026 to take a new professional role abroad. Appel said Illek assumed Mudesir’s responsibilities on an interim basis while a successor search proceeds. Appel later said Mudesir received no severance.
Shareholders voted on a range of agenda items, including dividend appropriation, discharge of the Management Board and Supervisory Board, appointments of auditors, creation of authorized capital, and amendments to the articles of association. Appel announced that shareholders approved all proposed resolutions. Key votes included approval of the EUR 1 dividend proposal, discharge for both boards, election of Supervisory Board members including Appel and Stefan B. Wintels, and the election of new members Dr. Thomas Dohmke and Dr. Philipp Herzig. Shareholders also approved an increase in Supervisory Board base remuneration from EUR 100,000 to EUR 115,000 as part of an adjustment package. A proposed jurisdiction clause amendment (agenda item 10) passed with a narrower margin than other items.
Deutsche Telekom said the next annual general meeting is expected to be held on April 14, 2027, in Bonn.
About Deutsche Telekom (ETR:DTE)
Deutsche Telekom AG, together with its subsidiaries, provides integrated telecommunication services. The company operates through Germany, United States, Europe, Systems Solutions, Group Development, and Group Headquarters and Group Services segments. It offers fixed-network services, including voice and data communication services based on fixed-network and broadband technology; and sells terminal equipment and other hardware products, as well as services to resellers. In addition, the company provides mobile voice and data services to consumers and business customers; sells mobile devices and other hardware products; and sells mobile services to resellers and to companies that purchases and markets network services to third parties, such as mobile virtual network operators.
