Q2 2026 freenet AG Earnings Call Transcript
Key Points
- freenet AG (FRTAF) surpassed 10 million subscribers, adding 140,000 in H1 2026, with strong growth in mobile (34,000) and IPTV (35,000) subscribers.
- Adjusted EBITDA increased by almost 40% in H1 2026, driven by strong performance in waipu.tv and the mobilezone acquisition, which expanded the sales footprint.
- Postpaid service revenue grew by 0.7%, and front-book pricing increased by 1%, indicating a stabilization in ARPU trends and a shift to value-over-volume.
- The IPTV business showed healthy growth, with gross profit rising from EUR38 million to EUR43 million, and the market penetration in Germany (18%) offers significant upside compared to other European markets.
- Free cash flow was strong at EUR155 million in H1, with a positive working capital development, supporting the company's dividend policy and shareholder returns.
- The mobile business is still affected by the negative MNO agreement effect, with negotiations ongoing and no final decision yet, creating uncertainty.
- Gross profit in mobile declined due to the unfavorable MNO agreement and high comparison base from Q2 2025, which included additional payments from a network operator.
- IPTV subscriber growth was impacted by aggressive competition from MagentaTV, and the expected boost from the soccer championship was weaker than anticipated.
- The company faces challenges in reaching its full-year guidance, as EBITDA growth in H2 will require significant improvement, with risks from competitive dynamics and phasing of costs.
- ARPU is expected to continue declining through 2027 due to the back-book impact, as older, higher-ARPU customers churn, limiting near-term revenue growth.
Ladies and gentlemen, and welcome to the freenet AG conference call on the second quarter 2026 and half-year results. (Operator Instructions) I will now hand over to Robin Harries, the CEO of freenet AG.
Good morning, everyone, and welcome to our Q2 earnings call. I'm very pleased with our performance in the first half of the year. Everything is moving in the right direction, and we see substantial growth opportunities ahead of us. In the first half of 2026, we expanded our subscription base by 140,000, surpassing 10 million subscribers.
I think this is an important milestone, which is very impressive and a clear statement to the strength of our sales organization. We are on track and can confirm our 2026 guidance. While others struggled in the first half of the year, we were able to add 34,000 mobile subscribers and 35,000 IPTV subscribers and could increase our postpaid service revenue.
We see progress in the integration of mobilezone. This is progressing
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