freenet (FNTN) Q1 2026 earnings summary

Executive summary

• Revenues rose 26.1% year-over-year to €761.9 million in Q1 2026, driven by the integration of mobilezone Germany and organic growth in postpaid and IPTV subscribers.

• Adjusted EBITDA was €122.0 million, down 3.6% year-over-year, reflecting a €12.5 million negative effect from a network operator contract; underlying business remains solid.

• Adjusted free cash flow increased 10.4% to €85.7 million, highlighting strong cash generation.

• Sustained customer growth in both Mobile and IPTV segments, with waipu.tv subscribers up 42,000 and robust adjusted EBITDA growth.

• Relaunch of freenet.de domain, major TV campaigns, and AI-driven initiatives enhanced brand visibility and operational efficiency.

Financial highlights

• Group revenue rose 26.1% year-over-year to €761.9 million, mainly from mobilezone consolidation.

• Gross profit increased 2.2% to €242 million, with gross margin down to 26.7% due to higher hardware sales.

• Adjusted EBITDA declined 3.6% to €122.0 million, impacted by a €12.5 million negative MNO effect.

• Adjusted free cash flow reached €85.7 million, up 10.4% year-over-year.

• Equity ratio improved to 45%, leverage reduced to 1.1x adjusted EBITDA.

Outlook and guidance

• Guidance for full-year 2026 confirmed: revenue and adjusted EBITDA expected at €500–530 million, adjusted FCF at €270–300 million.

• Moderate growth in postpaid customers and noticeable growth in waipu.tv subscribers projected.

• Dividend policy targets 80% of adjusted FCF or a minimum DPS of €2.0 for 2026–2028.

• Ongoing negotiations with Telefónica could impact guidance if a new agreement is reached.

• 2028 ambition is for adjusted EBITDA ≥ €620 million, with >6% CAGR from 2025.