Deutsche Telekom lifts buyback by €3 billion, raises cash-flow guidance

Deutsche Telekom raised its full-year buyback by up to €3 billion ($3.47 billion) and lifted free cash flow guidance after second-quarter revenue rose.

The raise came as analysts held their ground after the collapse of a planned T-Mobile US merger. JPMorgan kept an "Overweight" rating with a €38 target on July 27, and DZ Bank maintained a "Buy" with a €35 target, both citing the group's operational strength.

Adjusted earnings before interest, taxes, depreciation and amortization after leases rose to €11.8 billion ($13.6 billion) in the second quarter, from €11 billion a year earlier and above the €11.7 billion analyst consensus. Revenue was boosted by growth across all units, including Germany, the US and Europe. The company now expects free cash flow after leases of about €20 billion, up from more than €19.8 billion previously.

The buyback increase and guidance raise point to management confidence in standalone growth after plans for a full combination with T-Mobile US — a transaction valued at around $300 billion — were shelved. The stock closed Tuesday at €27.97, about 20 percent below its 52-week high of €34.35.

T-Mobile US, which accounts for the bulk of group value, raised its adjusted free cash flow target range to $18.4 billion to $18.8 billion after posting second-quarter earnings per share of $2.99, ahead of expectations. Adjusted core EBITDA at the US unit grew 12 percent to $9.5 billion, with postpaid service revenue up 13 percent to $15.9 billion.

Germany, the home market, grew more slowly, with first-quarter revenue up 1.9 percent to €6.3 billion. The group's full-year 2026 guidance points to adjusted EBITDA after leasing of €47.5 billion and earnings per share of about €2.20.

The buyback provides a structural floor under the stock, reducing the free float and supporting demand. Deutsche Telekom completed the third tranche of its 2026 program in July, purchasing 6.36 million shares.

The guidance raise and expanded buyback suggest management expects the operating engine to carry the stock without the merger fuel it was promised. Investors will watch the investor webcast and third-quarter results due Nov. 5 for updated segment margins and US churn data.

This article is for informational purposes only and does not constitute investment advice.