Deutsche Telecom has dodged the downturn for now, reporting an unexpected 12 percent rise in third quarter earnings. Boosted by its cost cutting program and lower writedowns, Europe’s largest telecoms group reported net income of 1.18 billion ($1.52 billion) up from last year’s 1.06 billion euros ($1.37 billion). According to Bloomberg, analysts had expected earnings to come in at 866 million euros ($1.12 billion). Revenue fell 1.5 percent to 15.45 billion euros ($19.9 billion), slightly above analyst forecasts of 15.4 billion euros ($19.8 billion).

DT’s mobile units were the group’s strongest growth drivers with T-Mobile USA and its Central and Eastern Europe units reporting double-digit growth rates in revenues and EBITDA. Mobile data usage continues “unabated.” Total data revenue excluding messaging was up 28.3 percent to 639 million euros ($824 million). Data revenue in Europe, excluding messaging, jumped 45.3 percent to 380 million euros ($489 million) since last year, while the number of web’n’walk customers climbed 67.2 percent. At T-Mobile USA, data revenue, excluding messaging, was up 19.9 percent to $391 million. The number of mobile customers added for all of DT increased by 8.3 percent compared to a year ago for a total of 126.7 million.

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Earnings highlights after the jump…

More Earnings Highlights:

— T‑Mobile USA revenue: Revenue at the US unit was hit by the weak dollar. On a US dollar basis, year on year, revenue increased 12.5 percent to $5.5 billion from $4.89 billion and adjusted EBITDA was up 10.6 percent to $1.56 billion from $1.4 billion. Measured in euros, the company reported a rise in revenue in the third quarter of 2.7 percent and growth in adjusted EBITDA of 1.0 percent.

—T-Mobile USA subs: T-Mob USA gained 670,000 customers in Q3, remaining stable from the last quarter. DT cited the G1 for generating “unusually large amount of interest.” As of the end of September, T-Mobile USA has 32.14 million customers, including the 4.4 million that came from its acquisition of SunCom. Churn was up slightly 0.1 percent yoy to 3 percent in Q3. Blended ARPU—combining prepaid and postpaid—was $52, down from $53 a year ago, and flat sequnetially. Non-voice made up 17.3 percent of the blended ARPU, or $8.90 a customer. For contract customers contract ARPU was $55 in the third quarter of 2008, consistent with the second quarter of 2008 and down from $57 in the third quarter of 2007.

— iPhone helps T-Mob Deutschland: T-Mobile Deutschland, which carries the handset exclusively, recorded 271,000 net additions in Q3, 82 percent more than in the same period last year. T-Mob called the iPhone a “significant driver” reporting that the iPhone 3G “was in extremely high demand” following its early July roll out. The unit has 401,000 total subs.

—T-Mobile UK revs down: UK revenues were hit by “tough competition”, the weak sterling, and “regulatory intervention.” On a pound sterling basis, sales in Q3 fell 6.7 percent to £0.8 billion ($1.3 billion), while adjusted EBITDA plunged 29.4 percent to £175 million ($278 million).