T-Mobile Added Fewer Postpaid Phone Subscribers Than Expected in 4Q -- 3rd Update

By Kelly Cloonan and Elias Schisgall

T-Mobile US reported fewer wireless subscribers in its fourth quarter than what analysts had expected as competition continued to intensify into the year.

The company also issued some financial targets through 2030, including a higher target for broadband customers.

The cell carrier on Wednesday posted a fourth-quarter profit of $2.1 billion, or $1.88 a share, compared with $2.98 billion, or $2.57 a share, a year earlier. The recent quarter included certain severance costs, net of tax, of $293 million, the company said.

Analysts polled by FactSet had expected earnings of $2.05 a share.

Revenue rose 11% to $24.33 billion, compared with analyst estimates of $24.17 billion.

Shares reversed course and were recently trading up 2.9% to $205.19 after falling as much as 5% in the premarket session.

The Bellevue, Wash., company said it has added 962,000 net subscribers for its postpaid phone service, its most lucrative phone offering, where service is paid for each month on a contract.

Analysts had expected T-Mobile to add 981,300 net postpaid phone connections in the quarter. Rival AT&T added 421,000 such subscribers in the same period, while Verizon Communications added 616,000, handily beating analyst estimates. Both T-Mobile and Verizon launched promotions to lure rivals' customers during the quarter.

T-Mobile added 495,000 net customers for its 5G broadband service in the quarter, compared with analyst estimates of 460,200. It also added 63,000 net fiber customers.

The results include USCellular, which T-Mobile acquired in August.

Chief Executive Srini Gopalan said the company sees opportunity ahead to cut down on customer pain points and accelerate its digital transformation.

"As we look to 2026, we're even more convicted that the future is brighter than ever before," said Gopalan, who started as CEO in November.

For the full year, T-Mobile expects to add 900,000 to one million postpaid accounts in total, including in phone and broadband.

The company lifted its outlook for service revenues to between $80.5 billion and $81.5 billion in 2027, up from a prior range of $75 billion to $76 billion.

It said core adjusted earnings before interest, taxes, depreciation and amortization are expected to be between $37 billion and $37.5 billion this year, and between $40 billion and $41 billion next year, representing a command annual growth rate of about 9% in the midpoint between 2023 and 2027.

Adjusted free cash flow is expected to reach between $19.5 billion and $20.5 billion in 2027, representing compound annual growth over four years of 10% at the midpoint.

The company also raised its target for 5G broadband customers to 15 million by the end of 2030. It had previously aimed for 12 million by the end of 2028.

T-Mobile also said Wednesday it plans to offer artificial intelligence-driven services built into its network, including live translation. Starting with a beta version this spring, certain customers will be able to translate phone calls in more than 50 languages, the company said.

The beta version aims to test the service gradually before it launches commercially later this year, T-Mobile said.

The company also said it expects to double its stock buybacks in the first quarter to up to about $5 billion.

Write to Kelly Cloonan at [e-mail] and Elias Schisgall at [e-mail]

(END) Dow Jones Newswires

02-11-26 1118ET