1&1 AG Reports Mixed Preliminary 2024 Results with Earnings Growth and Network Challenges

1&1 AG released its preliminary results for the 2024 fiscal year, highlighting both growth and challenges. The company saw a 0.8% increase in customer contracts, reaching 16.39 million, driven by 190,000 new mobile internet contracts. However, broadband connections decreased by 60,000. Service revenue increased by 1.8% to €3.30 million, while hardware revenues dropped significantly, leading to an overall revenue decline of 0.8% to €4,064.3 million.

The year was marked by a temporary outage of the new 1&1 mobile network in May 2024, increasing customer churn and impacting revenues and earnings. The migration of customers to the 1&1 network faced delays due to network component undersizing, and capacity bottlenecks further strained operations.

While EBITDA in the Access segment rose by 8.9%, reaching €856.1 million, startup costs for the 1&1 mobile network increased more than anticipated. This resulted in a decline in total EBITDA to €590.8 million. Ongoing negotiations for compensation from a partner responsible for the outage have yet to conclude.