Deutsche Telekom's €2 Billion Return to Shareholders Can’t Reverse 19% Drop from 2026 Peak

Deutsche Telekom accelerates €2B buyback amid stock slide; Q1 revenue up but net profit falls; T-Mobile US unveils AI platform; German wage deal raises costs.

The stock is sliding, but Deutsche Telekom is buying back shares at full throttle. Since launching its buyback programme on 2 April, the Bonn-based group has already scooped up more than 12 million of its own shares — including roughly 1.5 million in the week to 29 May alone, at an average price of €29.20 each. That week’s outlay exceeded €44 million, bringing the total deployment closer to the €2 billion earmarked for repurchases through 2026. Most of the bought-back stock is being cancelled, while a smaller slice flows into executive compensation plans.

The strategy comes at a time of clear price weakness. Deutsche Telekom shares closed Friday at €27.73, down 0.72% on the day and nearly 19% below February’s high of €34.35. The relative strength index stands at 38.6, signalling oversold territory, and the 52-week low of €25.99 is only 6.7% away. Both the 50-day and 200-day moving averages hover around €29, well above the current level, suggesting the stock lacks near-term technical momentum.

Operationally, the first quarter offered a mixed picture. Group revenue reached €29.9 billion, an organic increase of 4.7%, while management nudged up its full-year guidance: adjusted EBITDA AL is now seen at roughly €47.5 billion, with free cash flow AL topping €19.8 billion. Net profit, however, tumbled 28.2% to €2.0 billion, dragged down by the absence of the year-ago positive valuation effects from equity holdings.

The US business remains the engine room. T-Mobile US, in which Deutsche Telekom holds a 45.5% capital stake (effective 53.6% after accounting for treasury shares), contributed €19.7 billion of segment revenue and €7.7 billion of adjusted EBITDA AL in Q1. This week it unveiled Dynamic CX, an AI-powered network optimisation platform that adjusts mobile capacity in near real-time during major events. The system taps into public event data, schedules and online activity to anticipate crowds at stadiums, fan zones and airports — a capability T-Mobile US is already testing ahead of this summer’s big football tournament. While the technology marks an operational milestone, no new financial targets or quantified earnings impacts were announced.

Back in Germany, the domestic business is making headway on fibre. Fibre-to-the-home penetration hit 17.1%, connecting more than 13 million households, and the group plans to add another 2.5 million premises annually, backed by an extra €800 million in capital spending over three years. The cost side, however, is set to rise after a negotiated labour pact that is currently being voted on by ver.di members. The deal, due to be formally ratified on 19 June, phases in increases: an additional monthly payment climbs from €190 to €340 in August 2026 and to €480 by July 2027, with a further 2.4% across-the-board rise in 2028. The agreement rules out compulsory redundancies for its entire duration, giving the company labour peace — but also a permanently higher wage bill that must be offset by productivity gains and revenue growth.

The next key catalyst is 6 August, when the group reports second-quarter and first-half results. Until then, the pace of the buyback and the outcome of the ver.di ballot will set the tone. While the €2 billion repurchase programme sends a clear signal of confidence, the market has yet to reward the stock for the operational strength and the labour certainty now secured.