Deutsche Telekom booked the strongest quarterly operating profit of any DAX constituent in the first quarter of 2026, yet its shares continue to drift near the bottom of their 12-month range. The disconnect between record earnings and a sluggish stock price underscores how a brewing labour dispute is weighing on investor sentiment just as management raised its full-year outlook.
The Bonn-based group reported an EBIT of €5.8 billion for the first three months, outpacing DAX heavyweights such as Allianz and E.ON. Organic revenue climbed nearly 5 percent, while adjusted net profit rose 6.5 percent to €2.6 billion. Chief executive Tim Höttges described the start of the year as “robust”, pointing to broad-based growth and a stronger contribution from T-Mobile US as justification for nudging the 2026 operating profit forecast up to roughly €47.5 billion.
Despite that fundamental strength, the stock closed Friday at €27.63, shedding 0.58 percent on the day and leaving it 15.17 percent lower than a year ago. The share price now sits 19.33 percent below its 52-week high and only 4.46 percent above the year’s trough. Technically, the picture remains fragile: the stock trades below both its 50-day moving average of €30.16 and its longer-term 200-day line. A bearish candlestick pattern has also flashed, signalling potential selling pressure in the near term.
The reason for the market’s caution is largely external to the company’s operations. Wage negotiations with the ver.di union are heading into a critical fourth round on 26 and 27 May, and the conflict has escalated noticeably since industrial action began on 28 April. More than 20,000 employees have already taken part in warning strikes, with a rally in Potsdam drawing around 2,500 workers. The dispute is no longer confined to individual sites; staff from sales, service units and the T-Systems division have been called on to join solidarity walkouts.
Should investors sell immediately? Or is it worth buying Deutsche Telekom?
ver.di is demanding a 6.6 percent pay increase for roughly 60,000 tariff employees, plus an annual membership bonus of €660. For trainees and dual-study students, the union wants monthly pay to rise by €120 and a supplementary membership bonus of €240 per year. The employer side presented a structural offer during the third round of talks, but the union dismissed it as insufficient and is pressing for a significantly improved package in the upcoming session.
Analysts, for their part, remain broadly constructive. The average price target on the stock stands at around €38, with several major investment banks maintaining buy recommendations. The dividend of €1 per share for the last financial year provides a floor for long-term holders, and the raised earnings guidance sets a clear fundamental baseline for the months ahead.
What unsettles the market more than the cost of a potential settlement, however, is the signal that an unresolved internal conflict sends to investors. Deutsche Telekom’s operational engine is running smoothly—organic service revenue advanced 4.6 percent in the first quarter and organic EBITDA grew 7.5 percent. Yet every day the standoff persists chips away at the narrative of a steady, conflict-free recovery. The 26/27 May talks will therefore be watched as closely for their tone as for their numbers. If no breakthrough emerges, ver.di is expected to turn up the pressure again—and the stock may struggle to shake off the labour overhang even as the profit numbers keep improving.
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