Telefónica Deutschland narrows revenue decline to 2.9% in third quarter of 2026
Key Facts
Telefónica Deutschland reported a 2.9% year-on-year decline in third-quarter 2026 revenue to 1,903 million euros, a smaller fall than in the first half, according to results filed with Spain’s securities market regulator. The company said the quarterly improvement came mainly as business-to-consumer pressures eased temporarily. In the first nine months, revenue fell 7.6% to 5,597 million euros. The figures reflect continued contraction in the German business, albeit at a slower pace in the third quarter. The results also showed diverging trends across business lines, with device sales returning to growth and fixed-line revenue continuing to rise.
Device sales rose 2.5% in the third quarter, after falling 13.7% in the first nine months, the company said. Fixed-line revenue grew 5.7% year on year in the quarter and 5.5% in the nine months ended in September. Fixed-business revenue had increased 5.3% to 453 million euros in the first half, while device revenue fell 20.5% to 680 million euros over the same period. This comparison puts the third-quarter improvement against earlier weakness in device sales, while fixed business continued to grow. The gains in these two areas did not halt the overall revenue decline for the period.
Profitability remained under greater pressure than revenue, with adjusted operating profit at 566 million euros in the third quarter, down 9.9% year on year. In the first nine months, it reached 1,745 million euros, a decline of 8.5%, according to the company’s results. The adjusted operating profit margin fell 2.3 percentage points to 29.8% in the quarter. The company attributed this to non-recurring effects, higher marketing and roaming expenses, and a less favorable revenue mix. It also cited the timing of efficiency measures and a difficult comparison with the third quarter of 2025, leaving margins under pressure despite the narrower revenue decline.
In the context of the year’s performance, the first half saw a steeper contraction, with revenue falling 9.8% to 3,693 million euros. Lower device revenue, which totaled 680 million euros, was one of the main sources of weakness during that period, while fixed business recorded 453 million euros. Device sales then returned to growth in the third quarter, while fixed lines maintained their upward trend. The comparison between the two periods shows an improvement in the quarterly revenue trend without erasing the decline accumulated since the start of the year. Profitability also remains linked to transformation costs and the mix of revenue sources.
Telefónica Deutschland said its voluntary departure program was successfully implemented and that steps to resize its customer service divisions and retail store network are targeted for 2027 and 2028. The company also agreed to transfer its call-center sites in Bremen and Rostock to a digital services provider at the end of the year. These steps mark the next phase of a restructuring focused on organizing operations and reducing costs. The reported facts did not specify financial savings linked to these measures. Resizing customer service and the store network will form part of the operational transformation over the next two years.
At parent group Telefónica, the 2026 revenue growth target was cut to 1%–1.5% from a previous range of 1.5% to 2.5%. By contrast, the group raised its forecast for adjusted operating profit growth to slightly more than 2.5%. It also increased its free cash flow forecast to about 3.1 billion euros from about 3 billion previously. The revisions combine a weaker revenue outlook with improved group targets for profitability and cash flow. The German unit, meanwhile, ended the first nine months with revenue and adjusted operating profit below year-earlier levels.
TEFOF shares closed at 3.96 dollars on November 10, 2026, according to EL7 data. The price comes against the backdrop of third-quarter results showing a narrower revenue decline, alongside a continued fall in adjusted operating profit and pressure on its margin. The available information does not include the share’s movement on the results announcement session or a comparison with closing prices on other days. The announced operational measures for customer service and retail are set for 2027 and 2028. The group’s 2026 forecasts also set out its expected financial path through year-end.