The idiosyncratic structure of Deutsche Telekom becomes a problem.
Under the chairman of the board, Timotheus Höttges, the former state-owned company grew to unprecedented heights – in terms of both profit and debt. The stock soared to its highest price in 22 years in April.
However, Höttge’s success depends above all on the US subsidiary T-Mobile, which generates over two-thirds of the group’s sales. This imbalance is increasingly becoming a problem.
Competition on the US market has recently increased significantly. It is becoming increasingly difficult for T-Mobile to continue growing. This worries the management in Bonn, because essential parts of the strategy are based on a continuation of the success story.
In the home market of Germany, the downsides of expensive fiber optic expansion are showing up. Many customers remain skeptical, competitors complain about unfair competition.
Read here why the recently acquired majority in T-Mobile US is currently less stable than it seems.
