The first quarter was another good quarter for Germany's uber-telecom company, Deutsche Telekom (NYSE:DT). While revenue growth wasn't exactly blockbuster at 3.5%, and higher depreciation expenses led to 3% lower operating profits, EBITDA (earnings before interest, taxes, depreciation, and amortization) did tick up over 6%, and net income grew 60% over the prior year.

As you might guess from the discrepancy between net income and operating income, Deutsche Telekom clearly benefited from some non-operating improvements. Namely, it had considerably lower interest and tax expenses in the first quarter.

Free cash flow was also down quite a bit in the quarter. Some significant variances in working capital cut operating cash flow in half, while cash outlays for capital expenditures more than doubled from the year-ago period.

Of Deutsche Telekom's three main operating segments (broadband, mobile, and business), only mobile showed meaningful top-line growth in the period. Total revenue rose more than 7%, and EBITDA climbed over 15%, though higher depreciation expenses pushed operating income down by more than 15%. The T-Mobile USA business continues to perform well, adding nearly 1 million subscribers in the quarter.

The performance of the two other units was more mediocre, though. In the broadband business, there was a 4% revenue decline and a 3% EBITDA decline despite a 50% increase in broadband lines. For the business customers unit, revenue grew about 2% and EBITDA just eked out a small gain in what is far and away the company's smallest unit.

All in all, I'd say that Deutsche Telekom's performance in the quarter was solid, notwithstanding the variance in free cash flow. What's more, the name of the game for investors in this stock should be rational expectations. This isn't going to be a flare-out grower, and investors must also realize that frequent requirements to build out capital assets will occasionally hamper the company's ability to raise its payout.

Looking back, this has been a surprisingly volatile stock for such a large and generally "non-tech" company. After soaring almost five times in value from 1998 to 2000, the stock crashed down and lost over 90% of its value before again coming up off the mat. We can only hope that investors who overreacted on both the upswing and the downturn learned their lessons.

In any case, Deutsche Telekom (as a company, not necessarily as a stock) looks to be settling into a respectable low-to-moderate growth pattern. Eastern Europe continues to offer meaningful expansion potential, and the company's U.S. cellular business is more than holding its own. Top that off with a pretty fair dividend and you have a pretty decent foreign telco stock to consider.

We'll never just phone it in here at the Fool, but you can take advantage of our past work on the cellular and telecom space:

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).