Telecommunications company Deutsche Telekom AG (DT) Thursday reported higher third-quarter profit, helped by revenue growth, mainly in its overseas business, and cost-cutting measures. Meanwhile, the German company's U.S. wireless operation T-Mobile USA reported lower profit for the third quarter as its revenues dropped 2.3% due to lower service revenues. Going forward, Deutsche Telekom confirmed its fiscal 2009 adjusted EBITDA outlook. In the third quarter, the company's net profit grew 7.2% to 959 million euros from 895 million euros a year ago. On an adjusted basis, net profit was 1.07 billion euros, down 9.1% from 1.18 billion euros in the prior-year quarter.
The company stated that cost-cutting measures and improvements in efficiency helped to post year-on-year increases in profitability in all operating segments between July and September.
The company also reported quarterly net revenues of 16.26 billion euros, up 5.2% from 15.45 billion last year. Domestic revenues rose 0.6% to 7.20 billion euros from 7.16 billion euros in the prior-year quarter. International revenues reached $9.06 billion, up 9.2% from $8.296 billion in the previous year.
For the preceding second quarter, the company's net profit was 521 million euros on revenues of 16.24 billion euros.
The company's German operating segment generated revenues of 6.5 billion euros, a decline of 2% from the prior-year quarter. The German mobile communications business posted revenue growth of 1.4%, while the domestic fixed-network business' revenue declined 3.5% year-on-year.
T-Mobile USA, Inc., the U.S. wireless operation of Deutsche Telekom, reported third-quarter net income of $417 million, compared to $442 million last year. The company said that certain of the comparative figures in the prior periods have been reclassified to conform to the current period presentation.
T-Mobile's total revenues declined 2.3% to $5.38 billion from $5.51 billion in the year-ago quarter. Service revenues were $4.73 billion, down from $4.91 billion a year ago, hurt by lower Average Revenue Per User, or ARPU.
Blended ARPU was $47, lower than $52 in the third quarter of 2008. Prepaid ARPU dropped to $20 from $24 a year ago, due to fewer Flexpay no-contract customers.
Data services revenue reached $1 billion, an increase of 18% year-over-year.
T-Mobile USA also reported third-quarter contract revenues of $4.2 billion, down from $4.34 billion in the previous year. Prepaid revenues were $382 million, flat with last year. Roaming and other services generated revenues of $154 million, lower than $187 million in the prior-year quarter.
T-Mobile USA served 33.4 million customers at the end of the third quarter, up from 32.1 million at the end of the third quarter of 2008.
Total customers declined by 77,000, compared to net customer additions of 670,000 in the third quarter of 2008. The number of contract customers declined by 140,000 in the quarter. Prepaid net customer additions, including wholesale customers, were 63,000, down from 377,000 last year.
Further, Deutsche Telekom's mobile communications companies in the United Kingdom, Poland, the Netherlands, Austria, and the Czech Republic, all combined within the new Europe operating segment, posted revenues of 2.6 billion euros on a like-for-like basis, down 13.2% from the previous year. The results reflected the negative impact of exchange rate effects, particularly in Poland and the United Kingdom, and the reduction of termination charges.
Meanwhile, the Southern and Eastern Europe segment continued its positive development in the third quarter of 2009, Deutsche Telekom noted. Following the first-time inclusion of the OTE group with effect from February of this year, the segment recorded a year-on-year revenue growth of around EUR 1.4 billion to EUR 2.6 billion in the third quarter.
Measured in euros, the revenues generated by the national companies in Hungary, Croatia, Slovakia, Macedonia, and Montenegro declined in the third quarter, primarily due to negative exchange rate effects, mainly in Hungary due to the sharp decline in the forint, and continued high pressure from competition.
In addition, the company's Systems Solutions reported a 7.3% decline in revenues to 2.1 billion euros. According to the company, the lower revenues were attributable to its domestic business. T-Systems recorded an 11.7% drop in new orders to 1.7 billion euros.
Earlier on September 8, Deutsche Telekom together with France Telecom announced that they were holding exclusive negotiations on the establishment of a 50:50 joint venture between the Deutsche Telekom's UK subsidiary and Orange UK. The roll-out of the 3G network in the US is progressing well. The sale of 3G-enabled handsets and the sharp increase in data revenues highlights its enormous growth potential.
For the nine-month period, Deutsche Telekom posted a net profit of 356 million euros, compared with 2.21 billion euros in the prior-year period. Adjusted net profit decreased 3.1% to 2.49 billion euros from 2.57 billion euros in the previous year. Net revenue totaled 48.40 billion euros, up 6.2% from 45.56 billion euros a year earlier.
Going ahead, Deutsche Telekom continues to expect a decline of 2% to 4% in its fiscal 2009 adjusted EBITDA from last year's 19.5 billion euros. This is despite the recent negative development in exchange rates, particularly the marked weakness of the U.S. dollar against the euro over the course of the year, the company noted. Further, the company said it will continue its cost cutting and address the entire cost base of the group.
Among peers, Vodafone Group plc (VOD,VOD.L) is set to announce its second-quarter results on November 10.
DT closed Wednesday's trading at $13.69, up $0.16, on a volume of 1.23 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.