Deutsche Telekom Draws Fresh Buy Calls After ECB Nod and AI Buildout, Even as Payout Falls Short

Deutsche Telekom has picked up a pair of fresh accolades for its mobile network and a landmark mandate from the European Central Bank, yet the market's immediate reaction to its latest quarterly update centered on something else entirely: the size of the cheque it plans to hand back to shareholders.

Payout Plan Lands With a Thud

The board proposed a dividend of EUR 1.10 per share roughly a week ago, a figure that media reports suggest came in slightly below the analyst consensus. A share buyback slated for 2027, worth up to EUR 2 billion, likewise undershot expectations. According to media coverage, disappointment over the capital return package was the specific trigger for the share price losses that followed the quarterly release.

The Underlying Business Keeps Growing

Strip out the payout noise and the operating picture looks considerably brighter. Revenue for the third quarter of 2026 reached EUR 31.1 billion, an organic increase of 5.5%. Adjusted EBITDA AL for the same period came in at EUR 12.2 billion, and the Bonn-based group raised its full-year guidance. For 2026 it now projects adjusted EBITDA AL of around EUR 47.6 billion and free cash flow AL of roughly EUR 20.1 billion.

Two Brokers Trim Targets, Keep Buy Ratings

Analysts have adjusted their price expectations without losing faith in the stock. Goldman Sachs cut its target to EUR 36 from EUR 38 on November 5, keeping a "Buy" rating, according to the dpa-AFX analysis. Bank of America followed on Monday, lowering its target to EUR 32 from EUR 36 while maintaining its "Buy" call; media reports attribute the reduction to softer assumptions on cash inflow.

Network Tests Add a Second Crown

Away from the capital markets, the company's engineering credentials got another boost. IMTEST and zafaco named Deutsche Telekom the winner among four German network operators, awarding an overall grade of "very good" (1.24). The measurements behind that verdict were taken between August 31 and September 27, so the award published today reflects network performance during that window. It follows Friday's news that the operator had taken top spot in Computer BILD's nationwide mobile network test — the 15th consecutive time it has done so, according to the company, which cited particular strength in 5G speed and coverage.

ECB Taps Telekom for Digital Euro Role

Further afield, dpa-AFX reported on October 30 that Deutsche Telekom, working alongside Nexi, had won the European Central Bank's tender for central connectivity services underpinning the digital euro. The arrangement is a ten-year contract. Telefonica was selected by the ECB as the second independent network service provider.

Munich AI Factory Gets a Cash Injection

The group also announced fresh spending on artificial intelligence infrastructure yesterday, pledging just under another quarter of a billion euros to expand its AI factory in Munich's Tucherpark and lift capacity to 20 megawatts. Additional NVIDIA Blackwell Ultra systems are planned, and the first expansion stage is already fully booked, according to company statements. Deutsche Telekom is also weighing a possible further extension of its Bavarian commitment, though no final investment decision has been taken.

Investors will get their next hard read on the group's trajectory on February 25, 2027, when fourth-quarter and full-year 2026 results are due, per the company's financial calendar.