T-Mobile Outpaces the Industry on Customer and Service Revenue Growth, Delivers Highest Cash Flow in Company History in Q3 2023 and Raises Guidance Again

Industry-Leading Customer Growth Fueled by Best Network and Value Combination⁽¹⁾

Postpaid net account additions of 386 thousand, best in industry
Postpaid net customer additions of 1.2 million, best in industry and raising guidance
Postpaid phone net customer additions of 850 thousand, best in industry
Postpaid phone churn of 0.87%, record low for Q3
High Speed Internet net customer additions of 557 thousand, best in industry

Translating Customer Growth Into Industry-Leading Financial Growth

Service revenues of $15.9 billion grew 4% year-over-year and Postpaid service revenues of $12.3 billion grew 6% year-over-year, both best in industry growth
Net income of $2.1 billion grew 322% year-over-year and diluted earnings per share (“EPS”) of $1.82 grew 355% year-over-year, both best in industry growth
Core Adjusted EBITDA⁽²⁾ of $7.5 billion grew 12% year-over-year, best in industry growth and raising guidance
Net cash provided by operating activities of $5.3 billion grew 21% year-over-year, best in industry growth and raising guidance
Adjusted Free Cash Flow⁽²⁾ of $4.0 billion grew 94% year-over-year, best in industry growth and raising guidance
Repurchased $2.7billion of common stock in Q3 2023 and $14.7 billion cumulatively as of October 20^th

T-Mobile Reaches Major Network Milestone and Continues Reign as Nationwide Overall Network Leader

300 million Americans now covered by Ultra Capacity 5G, achieving the year-end goal more than two months ahead of schedule, while the total 5G network covers more than 330 million people (98% of Americans)
Clean sweep across every category for overall network performance for the fourth quarter in a row from Ookla and best 5G availability in the world from Opensignal

Bellevue, WA — October 25, 2023 — T-Mobile US, Inc. (NASDAQ: TMUS) reported third quarter 2023 results today, outpacing the industry on customer growth, fueled by its best network and value combination across its unique growth opportunities. The Company continues to translate its industry-leading customer growth into best-in-class growth in service revenues, profitability and cash flow, while raising full-year 2023 guidance. T-Mobile continues delivering on its plan to return value to stockholders, buying back $2.7billion of common stock throughout the quarter, while announcing the second tranche of its substantial capital return program and introducing a dividend for the first time in Company history. The Company also announced its Ultra Capacity 5G network now covers 300 million people with dedicated mid-band spectrum, reaching its 2023 goal over two months ahead of schedule.

“I’ve said it before and I’ll say it again: in this competitive environment, only T-Mobile can deliver the type of stellar results we saw in Q3 because only we can consistently deliver the best network and best value combination that customers want,” said Mike Sievert, CEO of T-Mobile. “This quarter’s best-in-class customer and financial growth, including our industry-leading postpaid net customer AND account adds and highest cash flow in Un-carrier history, paint a clear picture of a durable and differentiated strategy that is working. Our unmatched offering is bringing more and more consumers and businesses to the Un-carrier, including, for the first time ever, the highest share of postpaid switchers in smaller markets and rural areas. At the same time, we’re delivering significant shareholder value that will propel us into a future where we have plenty of room to run.”

Industry-Leading Customer Growth Fueled by Best Network and Value Combination⁽¹⁾

Postpaid net account additions of 386 thousand were relatively flat year-over-year, reflecting continued industry-leading share of net account additions despite fewer High Speed Internet only net account additions.
Postpaid net customer additions of 1.2 million decreased 401 thousand year-over-year. Postpaid net customer additions continue to reflect industry-leading net additions in postpaid phone and High Speed Internet, partially offset by deactivations of lower ARPU mobile internet devices in the educational sector that were originally activated during the Pandemic and no longer needed.
Postpaid phone net customer additions of 850 thousand were relatively flat year-over-year, reflecting increased gross additions and lower churn, offset by increased deactivations from a customer base that grew 4%. Postpaid phone churn of 0.87% improved 1 basis point year-over-year.
Prepaid net customer additions of 79 thousand decreased 26 thousand year-over-year, and Prepaid churn was 2.81%.
High Speed Internet net customer additions of 557 thousand decreased 21 thousand year-over-year, reflecting continued growth in gross additions driven by increasing customer demand and lower churn, offset by increased deactivations from a customer base that doubled year-over-year, ending the quarter at 4.2 million customers.
Total net customer additions of 1.3 million decreased 427 thousand year-over-year. The total customer count increased to a record high of 117.9 million.

Translating Customer Growth Into Industry-Leading Financial Growth⁽¹⁾

Total service revenues of $15.9 billion increased 4% year-over-year, and Postpaid service revenues of $12.3 billion increased 6% year-over-year.
Net income of $2.1 billion increased $1.6 billion year-over-year, which included Merger-related costs, net of tax, of $114 million and severance and related costs associated with the August 2023 workforce reduction, net of tax, of $353 million. Diluted EPS of $1.82 per share increased $1.42 per share year-over-year.
Core Adjusted EBITDA of $7.5 billion increased 12% year-over-year, primarily due to Service revenue growth and increased synergy realization.
Net cash provided by operating activities of $5.3 billion increased 21% year-over-year, which included cash payments for Merger-related costs of $345 million.
Cash purchases of property and equipment, including capitalized interest, of $2.4 billion decreased 33% year-over-year, driven by increased capital efficiencies from accelerated investments in the nationwide 5G network in 2022.
Adjusted Free Cash Flow of $4.0 billion increased 94% year-over-year, which included cash payments for Merger-related costs of $345 million.
Stockholder Returns included 19.3million shares of common stock repurchased for $2.7billion in Q3 2023, with 104.3million cumulative shares repurchased for $14.7 billion as of October 20, 2023. Including a declared $0.65 per share dividend that will be paid on December 15, 2023, the remaining authorization for additional stock repurchases and dividends through December 2024 is $17.5billion.

T-Mobile Reaches Major Network Milestone and Continues Reign as Nationwide Overall Network Leader

Wednesday, October 25, 2023, at 8:00 a.m. (EDT)

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Contact Information

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About T-Mobile US, Inc.

T-Mobile US, Inc. (NASDAQ: TMUS) is America’s supercharged Un-carrier, delivering an advanced 4G LTE and transformative nationwide 5G network that will offer reliable connectivity for all. T-Mobile’s customers benefit from its unmatched combination of value and quality, unwavering obsession with offering them the best possible service experience and undisputable drive for disruption that creates competition and innovation in wireless and beyond. Based in Bellevue, Wash., T-Mobile provides services through its subsidiaries and operates its flagship brands, T-Mobile and Metro by T-Mobile. For more information please visit: https://www.t-mobile.com.

Forward-Looking Statements

This communication includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including information concerning T-Mobile US, Inc.’s future results of operations, are forward-looking statements. These forward-looking statements are generally identified by the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “could” or similar expressions.

Forward-looking statements are based on current expectations and assumptions, which are subject to risks and uncertainties and may cause actual results to differ materially from the forward-looking statements. Important factors that could affect future results and cause those results to differ materially from those expressed in the forward-looking statements include, among others, the following: competition, industry consolidation and changes in the market for wireless communications services and other forms of connectivity; criminal cyberattacks, disruption, data loss or other security breaches; our inability to take advantage of technological developments on a timely basis; our inability to retain or motivate key personnel, hire qualified personnel or maintain our corporate culture; system failures and business disruptions, allowing for unauthorized use of or interference with our network and other systems; the scarcity and cost of additional wireless spectrum, and regulations relating to spectrum use; the difficulties in maintaining multiple billing systems following the Merger (as defined below) and any unanticipated difficulties, disruption, or significant delays in our long-term strategy to convert Sprint’s legacy customers onto T-Mobile’s billing platforms; the impacts of the actions we have taken and conditions we have agreed to in connection with the regulatory proceedings and approvals of the Transactions (as defined below), including the acquisition by DISH Network Corporation (“DISH”) of the prepaid wireless business operated under the Boost Mobile and Sprint prepaid brands (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Personal Communications Company LLC (“Shentel”) and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets, and the assumption of certain related liabilities (collectively, the “Prepaid Transaction”), the complaint and proposed final judgment agreed to by us, Deutsche Telekom AG (“DT”), Sprint Corporation, now known as Sprint LLC (“Sprint”), SoftBank Group Corp. (“SoftBank”) and DISH with the U.S. District Court for the District of Columbia, which was approved by the Court on April 1, 2020, the proposed commitments filed with the Secretary of the Federal Communications Commission (“FCC”), which we announced on May 20, 2019, certain national security commitments and undertakings, and any other commitments or undertakings entered into, including, but not limited to, those we have made to certain states and nongovernmental organizations (collectively, the “Government Commitments”), and the challenges in satisfying the Government Commitments in the required time frames and the significant cumulative costs incurred in tracking and monitoring compliance over multiple years; adverse economic, political or market conditions in the U.S. and international markets, including changes resulting from increases in inflation or interest rates, supply chain disruptions, and impacts of geopolitical instability, such as the Ukraine-Russia war and Israel-Hamas war; our inability to manage the ongoing commercial services arrangements entered into in connection with the Prepaid Transaction, and known or unknown liabilities arising in connection therewith; the timing and effects of any future acquisition, divestiture, investment, or merger involving us; any disruption or failure of our third parties (including key suppliers) to provide products or services for the operation of our business; our inability to fully realize the synergy benefits from the merger (the "Merger") with Sprint, pursuant to the Business Combination Agreement with Sprint and the other parties named therein (as amended, the "Business Combination Agreement") and the other transactions contemplated by the Business Combination Agreement (collectively, the "Transactions") in the expected time frame; our substantial level of indebtedness and our inability to service our debt obligations in accordance with their terms or to comply with the restrictive covenants contained therein; changes in the credit market conditions, credit rating downgrades or an inability to access debt markets; restrictive covenants including the agreements governing our indebtedness and other financings; the risk of future material weaknesses we may identify, or any other failure by us to maintain effective internal controls, and the resulting significant costs and reputational damage; any changes in regulations or in the regulatory framework under which we operate; laws and regulations relating to the handling of privacy and data protection; unfavorable outcomes of and increased costs from existing or future regulatory or legal proceedings; our offering of regulated financial services products and exposure to a wide variety of state and federal regulations; new or amended tax laws or regulations or administrative interpretations and judicial decisions affecting the scope or application of tax laws or regulations; our wireless licenses, including those controlled through leasing agreements, are subject to renewal and may be revoked; our exclusive forum provision as provided in our Certificate of Incorporation; interests of DT, our controlling stockholder, which may differ from the interests of other stockholders; future sales of our common stock by DT and SoftBank and our inability to attract additional equity financing outside the United States due to foreign ownership limitations by the FCC; the dollar amount authorized for our 2023-2024 Stockholder Return Program may not be fully utilized, and our share repurchases and dividend payments pursuant thereto may fail to have the desired impact on stockholder value and other risks as disclosed in our most recent annual report on Form 10-K, 10-Q and other filings with the Securities and Exchange Commission (the “SEC”).

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T-Mobile Outpaces the Industry on Customer and Service Revenue Growth, Delivers Highest Cash Flow in Company History in Q3 2023 and Raises Guidance Again - T-Mobile Newsroom (2024)