Telekom's Satellite Setback Fades Into the Background as Cash Flow Upgrade and Rating Lift Take Centre Stage
Published on 08/20/2026 at 07:42 | Redaktion boerse-global.de
Losing a marquee airline connectivity contract to Elon Musk's Starlink might once have rattled Deutsche Telekom's investors. Not this week. The Bonn-based group's shares closed Wednesday at €29.13, up 0.9 per cent on the day, as the market shrugged off the Lufthansa development and instead focused on a more consequential pair of catalysts: an upgraded cash flow forecast and a credit rating boost from Fitch.
The satellite interlopers are, for now, a footnote. SpaceX's "Direct to Cell" service is set to replace Telekom as Lufthansa's in-flight connectivity provider, a shift that analysts read as a potential harbinger of broader disruption in the telecoms sector. Satellite-based rivals are encroaching on territory long dominated by terrestrial infrastructure players, even if the direct financial impact on Telekom from this particular contract loss is likely to be contained. The muted share price reaction suggests investors concur.
Cash Flow Guidance Lifted, Buyback Expanded
The real momentum driver comes from the second-quarter numbers. Revenue rose organically by 3.3 per cent to €29.9 billion, while adjusted EBITDA AL climbed 7.3 per cent on the same basis to €11.8 billion. Free cash flow AL advanced 3.1 per cent to €5.0 billion — enough for management to raise its full-year 2026 free cash flow guidance to around €20 billion, up from the previous "more than €19.8 billion" target.
That upgraded outlook has been paired with a beefed-up capital return programme. The share buyback has been increased by up to €3 billion to a total of up to €5 billion by year-end. The expanded envelope follows an earlier tranche of up to €2 billion, of which roughly €1.2 billion had been deployed by 5 August, representing around 42.1 million shares repurchased from the market.
The improved earnings picture has also earned external validation. Fitch Ratings lifted Deutsche Telekom's long-term issuer default rating and senior unsecured debt rating from BBB+ to A- in June — a move that typically lowers financing costs and signals confidence in the group's financial heft at a time when it is simultaneously expanding and returning capital to shareholders.
Should investors sell immediately? Or is it worth buying Deutsche Telekom?
T-Mobile US Carries the Load
The growth engine remains T-Mobile US. The American subsidiary posted an 8.9 per cent rise in service revenue to $19.0 billion, with adjusted EBITDA AL up 12.1 per cent to $9.3 billion, alongside 277,000 net new postpaid customers.
Germany, meanwhile, delivered a 3.7 per cent revenue increase to €6.5 billion. The domestic picture is one of transition: the group shed 20,000 traditional broadband customers but added 161,000 new fibre subscribers, with 13.6 million homes now passed and a take-up rate of 17.5 per cent.
Polish Expansion Adds Fibre Firepower
The growth narrative is reinforced by a roughly €1 billion acquisition in Poland. Telekom is buying fibre operator Fiberhost — serving 1.4 million households — and TV and broadband provider Inea with more than 300,000 customers from Macquarie Asset Management. Both businesses will operate under the T-Mobile Polska brand, deepening the group's broadband footprint in Central and Eastern Europe.
Rating and Buyback Support the Tape
The shares have found solid footing in recent weeks. Over the past 30 days, the stock has gained 8.7 per cent, and it is up 4.8 per cent year to date. The rejection of a potential T-Mobile US merger last Saturday barely dented sentiment — the stock has risen 1.7 per cent since — while the buyback expansion announced roughly two weeks ago has been followed by a 3.4 per cent advance.
Still, the recovery has its limits. The stock trades about 15 per cent below its 52-week high of €34.35, set in late February, though it sits roughly 24 per cent above the year's low of €23.54 from the summer. The recent gains have been driven more by the improved operational picture and the rating upgrade than by the now-digested merger and buyback headlines.
What's Next: AI Day and Q3 Numbers
Investors now have two dates circled on the calendar. On 5 October, Telekom hosts an investor day focused on artificial intelligence, where management is expected to lay out its AI strategy and ambitions. A month later, on 5 November, third-quarter results will show whether the second quarter's momentum has carried through — and how the group intends to weave AI investment into its broader growth narrative.
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