This article is a work in progress!

Return to: Q4 2025 Earnings Calendar | https://forum.investmentwiki.org/t/q4-2025-united-internet-earnings/558/2?u=aron

See also: **United Internet Valuation Model (Google Sheets) | 2025 Q3 United Internet Earnings | ‣**

Results materials: Q4 2025 1&1 Press release | Q4 2025 United Internet Press release | 1&1 annual report

9:00 CET IONOS Analyst Conference call

13:00 CET 1&1 Analyst Conference call

14:30 CET United Internet Analyst Conference call

<aside> 🔔

Aron’s assessment and recommendation:

Post-earnings recommendation:

Based on the positives and negatives highlighted in the post-earnings observations below , I reiterate my hold rating on United Internet shares.

Pre-earnings recommendation:

Given the low-band spectrum uncertainty and the revenue headwind at IONOS, I reiterate a “hold” rating on United Internet shares.

Post earnings observations

• Revenue and EBITDA margin at group level was stable (Valuation Model (Google Sheet))
• I don’t like that Dommermuth is skeptic on AI gains in the mobile network other than efficiency gains (earnings call)
• Dommermuth reiterates they are not planning to sell 1&1 at all and specifically pointed out that there are no discussions! (earnings call)
• Vodafone national roaming costs remains a large risk in my opinion as Vodafone may not want to spend a lot of money in promotional activity or marketing (earnings call)
  • 1&1 EBITDA of 537.5 in 2025 was weaker than management guidance of 545 m despite 16 m contribution by Versatel suggesting that National roaming costs increased further (a miss of around 25 m when you exclude benefit from Versatel)!
• IONOS management commentaries on impact of AI were positive. Dommermuth is quite enthusiastic about AI being incremental instead of detrimental to the business (earnings call)
• Strong customer momentum at IONOS, which is expected to continue and pricing is starting to improve sequentially (earnings call)
• Revenue was driven by average price per user (ARPU) which rose 4.4% (+0.81% when you exclude Versatel) (Valuation Model (Google Sheet))
• 1&1 expects operating EBITDA growth of approximately €100 million p.a. in 2027 and 2028. 2026 EBITDA guided at 800 m-contribution from 1&1 Versatel which generated EUR 183 m in 2024 and 100 m benefit from end of customer migration.
• 1&1 EBITDA guidance of EUR 800 m in 2026 is lower than my estimate of EUR 850 m
• 1&1 cash capex for 2026 is expected to be €500- €550 (2025 including 1&1 Versatel (€19.9 m): €652 million). Cash capex at similar level as 2026 in 2027 and 2028.
• BNetzA decision on the low-band spectrum expected in the course of spring as consultations expected to end in March 18 (page 58)
• 1&1 said they were able to commission an average of 300 active antenna sites per quarter in 2025 and reached 27% coverage of Germany households at the end of 2025(page 7)
• 1&1 EPS of €0.31 was better than analysts estimate of €0.25, largely driven by strong tax benefit (Valuation Model (Google Sheet))
  • Notebook LLM: I saw there was a strong tax benefit in Q4. What was the driver?
• Vodafone-1&1 National roaming contract may not interfere with acquisition by 1&1 or takeover of 1&1?
  • Agreement clause
• 1&1 is planning to slightly increase prices for new customers (earnings call)
• Consumer Applications (GMX and WEB) grew quite strongly (revenue growth of 15% and EBITDA growth of 17%) due to strong organic growth (and advertising revenue growth) and the fact they now operate own server (earnings call)
• 1&1 expects customer contracts to grow moderately again, depending on the competitive environment versus decline of 70k in 2025 (page 110) </aside>

<aside> 🔔

Moritz assessment

Post earnings observations

• 1&1 very strong operating cash flow of €604million (up almost 100% a year) + strong FCF of €195million despite large capex. ← Mainly due to positive effects from working capital. Underlying operating cash flow approx. same level as 2024 of €499million
• Strongly increased headcount by 1,400 persons (+ almost 50%) largely due to Versatel acquisition?
• I liked the comment that everyone now looks to transition to building open ran p.5 </aside>

Untitled

Q4 2025 United Internet Cautiously Bullish Outlook

[https://docs.google.com/spreadsheets/d/1tLMFLm722OTytTQZUUTayVLqoqISfSvLKNfljXN64vE/edit?gid=1832432417#gid=1832432417](https://docs.google.com/spreadsheets/d/1tLMFLm722OTytTQZUUTayVLqoqISfSvLKNfljXN64vE/preview?gid=1832432417#gid=1832432417)

Q4 2025 United Internet Earnings Bullish and Bearish arguments

Key Assumptions for Q4 2025 Base Model

1&1 assumptions

• Mobile contracts growth of 1% y/y: Mobile contracts were impacted by customer migration and network outage in H1 2025 but migration is now over and network is now stable. Similarly, German telecommunication market is increasingly mature.
• Broadband contracts to decline 2.8%: While broadband conditions are improving (as per competitors), 1&1 said in Q3 2025 earnings it doesn’t expect meaningful improvement until 2026. Similarly, growth in this business is mainly through price and not volume.
• ARPU to be flat at -0.1%: 1&1 competitors (especially Vodafone which supplies 1&1 with national roaming) said pricing pressure was still elevated in Q4 2025.
• 1&1 other (hardware revenue) growth of 5%: Assumes growth will be almost the same as in Q3 2025. This business is highly volatile as it’s based on smartphone releases, hence hard to estimate.