4.3 Forecast report

Expectations for the economy

In its global economic outlook published in January 2021, the International Monetary Fund (IMF) updated its forecasts for the development of the global economies in 2021 and 2022. The IMF now expects the global economy to recover in the current and following year. In its global economic outlook, the Fund forecasts global growth of 5.5% and 4.2% for the years 2021 and 2022 – following a decline of -3.5% in 2020.

The IMF is thus more optimistic than in its outlook of October 2020. The Fund cited the positive impact of the ongoing vaccination campaigns and the additional economic stimulus measures recently adopted in the USA and Japan as reasons for this. In addition, the estimated global economic decline of -3.5% in 2020 was not as severe as feared in the last forecast in October 2020, when -4.4% was anticipated.

The latest IMF forecasts for United Internet’s target markets in North America (the USA, Canada, and Mexico) are as follows: the US economy is expected to grow by +5.1% in 2021 and +2.5% in 2022 (after -3.4% in 2020); in Canada, economic growth of +3.6% and +4.1% is anticipated in 2021 and 2022 (after -5.5% in 2020); and the economy in Mexico is also expected to grow again, by +4.3% in 2021 and +2.5% in 2022 (after -8.5% in 2020).

The IMF anticipates growth of +4.2% and +3.6% in the eurozone for 2021 and 2022 (after -7.2% in 2020).

The IMF also expects positive economic trends in United Internet’s main European markets (France, Spain, Italy, and the non-EU country UK): the Fund forecasts growth of +5.5% in 2021 and +4.1% in 2022 for France (after -9.0% in 2020); growth in Spain is expected to reach +5.9% and +4.7% in 2021 and 2022 (after -11.1% in 2020); growth of +3.0% and +3.6% is forecast for Italy in 2021 and 2022 (after -9.2% in 2020); and for the UK, the IMF anticipates growth in 2021 and 2022 of +4.5% and +5.0% (after -10.0% in 2020).

For United Internet’s most important market, Germany, the IMF forecasts economic growth of +3.5% in 2021 and +3.1% in 2022 (after -5.4% in 2020). With expected growth of +3.5% for 2021, the Fund is above the German government’s own forecast of +3.0% growth in price-adjusted GDP, as published in its Annual Economic Report 2021 on January 26, 2021.

Market forecast: GDP development of most important economies for United Internet












































Source: International Monetary Fund, World Economic Outlook (Update), January 2021

Sector/market expectations

Following the “corona shock”, the industry association Bitkom believes that the German ICT market as a whole will return to growth of +2.7% in 2021 (prior year: -0.6%) to € 174.4 billion.

The IT market is expected to gain in relevance again in 2021 and strengthen its importance as the largest segment of the industry. According to Bitkom calculations, sales will increase by +4.2% (prior year: -0.7%) to € 98.6 billion. IT hardware sales are likely to grow the fastest – in particular computers, servers and periphery – at +8.6% (prior year: +3.2%) to € 31.6 billion. Software sales are expected to return to growth with an increase of +4.1% (prior year: -1.0%) to € 27.0 billion. And the IT services business – which also includes IT consulting – is also expected to turn positive again with growth of +1.1% (prior year: -3.2%) to € 40.0 billion.

Sales of consumer electronics continue to fall. According to a Bitkom forecast, sales will decline for the fourth year in succession in 2021, albeit at a slower rate than in the past few years. This smallest ICT sub-market is likely to shrink by -2.4% (prior year: -3.0%) to € 8.3 billion.

The most important ICT markets for United Internet’s business model are the German telecommunications market (broadband connections and mobile internet) for its mostly subscription-financed Access division, and the global cloud computing and German online advertising markets for its subscription- and ad-financed Applications division.

Telecommunications market in Germany

The industry association Bitkom forecasts moderate growth for the German telecommunications market as a whole. Following two years of consolidation, sales are expected to grow by +1.0% (prior year: -0.1%) to € 67.4 billion in 2021.

Slight growth of +0.3% (prior year: +0.1%) to € 48.7 billion is anticipated for telecommunication services. Sales of TC devices are set to grow by +2.8% (prior year: +0.3%) to € 11.6 billion. The telecommunication infrastructure business is forecast to grow the strongest at +3.2% (prior year: -2.4%) to € 7.1 billion. The industry association expects network operators to invest heavily in the future of their fixed-line (expansion of fiber-optics) and mobile communications (expansion of new 5G mobile communications standard) networks.

Market forecast: telecommunications market in Germany

in € billion







+ 1.0%

Source: Bitkom, Annual press conference, January 2021

Global cloud computing market

In an update of its study “Forecast Analysis: Public Cloud Services, Worldwide, 2018-2024, 3Q20 Update” (September 2020), Gartner forecasts global growth for public cloud services of +18.4% from USD 257.54 billion to USD 304.99 billion in 2021, following the pandemic-related slowdown of growth in 2020 (+6.1%).

Market forecast: global cloud computing

in $ billion




Global sales of public cloud services



+ 18.4%

thereof Application Infrastructure Services (PaaS)



+ 26.6%

thereof Application Services (SaaS)



+ 16.1%

thereof System Infrastructure Services (IaaS)



+ 26.9%

thereof Management and Security Services



+ 14.2%

thereof Business Process Services (BPaaS)



+ 6.2%

thereof Cloud Desktop as a Service (DaaS)



+ 62.5%

Source: Gartner, September 2020

Online advertising market in Germany

After the pandemic-related strong decline in online advertising of -4.7% in 2020, PricewaterhouseCoopers expects the market to recover in 2021 with total market growth (mobile advertising and desktop advertising) of +7.5% to € 8.70 billion.

The strongest growth is expected for video advertising and display advertising with increases of +16.9% and +8.7%, respectively.

Market forecast: online advertising in Germany (mobile advertising & desktop advertising)

in € billion




Online advertising revenues



+ 7.5%

thereof search marketing



+ 3.2%

thereof display advertising



+ 8.7%

thereof affiliate / classifieds



+ 4.1%

thereof video advertising



+ 16.9%

Source: PricewaterhouseCoopers, German Entertainment and Media Outlook 2020 – 2024, November 2020

Expectations for the Company in 2021

Forecast for the fiscal year 2021

For the fiscal year 2021, United Internet expects sales growth to approx. € 5.5 billion (2020: € 5.367 billion). Without consideration of the out-of-period income of approx. € 34 million in connection with the planned conclusion of a national roaming agreement, EBITDA is expected to increase to approx. € 1.22 billion (2020: € 1.179 billion).

Planning is based on comparable usage behaviour due to the coronavirus pandemic as in the fiscal year 2020 and consequently a comparable burden on sales and earnings.

Planning includes high investments in future topics. For example, 1&1 Drillisch plans initial costs for the 5G network rollout of approx. € 30 million (2020: around € 14 million) and IONOS an additional approx. € 40 million for a product and sales drive. Following the integration of STRATO, World4You and ProfitBricks in the past few years and its successful rebranding, IONOS aims to focus on expanding its cloud business and driving further internationalization. In the current year, IONOS expects to reach sales of approx. € 1 billion for the first time. The IPO is scheduled to be held within the next two years.

The above mentioned forecasts are subject to uncertainty, as an exact assessment of the duration and further impact of the coronavirus pandemic is not currently possible. For further information, please refer to the Risk Report of this Management Report.

Due to its role as a holding company, the earnings of United Internet AG at parent company level are mainly influenced by its investment result (profit transfers and dividends) and the interest result. Against this backdrop, the Management Board expects strongly positive net income for fiscal year 2021 (subject to possible special items).

United Internet AG intends to maintain its shareholder-friendly dividend policy based on continuity in the coming years. Dividend payouts will continue to represent approx. 20-40% of adjusted net income from continued operations after minority interests (adjusted net income attributable to “shareholders of United Internet AG” – according to the consolidated statement of comprehensive income) in the future. The prerequisite, however, is that funds are not required for further Company development.

Management Board’s overall statement on the anticipated development

The Management Board of United Internet AG is upbeat about its prospects for the future. Thanks to a business model based predominantly on electronic subscriptions, United Internet believes it is largely stable enough to withstand cyclical influences. And with the investments made over the past few years in customer relationships, new business fields and internationalization, as well as via acquisitions and investments, the Company has laid a broad foundation for its planned future growth.

United Internet will continue to pursue this sustainable business policy in the coming years. In addition to the above mentioned investments in future-oriented topics in the Consumer Access and Business Applications segments, the segments will focus on the following topics.

  • In the Consumer Access segment, the main focus in 2021 will be on marketing mobile internet products and winning high-quality customer relationships. The Company also plans to leverage the strong positioning of its broadband products to generate further growth.
  • In the Business Access segment, the Company’s own fiber-optic network is to be expanded in 2021 with the connection of further locations. Activities for business and wholesale customers will also be expanded.
  • In fiscal year 2021, the key topics in the Consumer Applications segment will again be increasing fee-based customer relationships and the further expansion of data-driven business models.
  • In the Business Applications segment, the focus will continue to be on expanding business with existing customers and gaining new high-quality customer relationships in 2021. In addition, the segment will strengthen its cloud business in particular and drive its international expansion.

Following a successful start to the year (at the time of preparing this Management Report), the Company’s Management Board believes that the Company is on track to reach the forecast presented above in the section “Forecast for the fiscal year 2021”.

Forward-looking statements

This Management Report contains forward-looking statements based on current expectations, assumptions, and projections of the Management Board of United Internet AG and currently available information. These forward-looking statements are subject to various risks and uncertainties and are based upon expectations, assumptions, and projections that may not prove to be accurate. United Internet AG does not guarantee that these forward-looking statements will prove to be accurate and does not accept any obligation, nor have the intention, to adjust or update the forward-looking statements contained in this report.