Industry-Leading Customer Growth and Sprint Merger Result in Overtaking AT&T as #2 Wireless Provider.
1,245,000 total net additions, best in industry
1,112,000 postpaid net additions, best in industry
253,000 postpaid phone net additions with postpaid phone churn of 0.80%
133,000 prepaid net additions with prepaid churn of 2.81%
98.3 million total customers at the end of Q2 2020, 2nd most in industry
Strong Financial Results in First Quarter as New T-Mobile
Total revenues of $17.7 billion and service revenues of $13.2 billion
Net income(1) of $110 million and diluted earnings per share ('EPS') of $0.09
Adjusted EBITDA(1) of $7.0 billion
Net cash provided by operating activities of $777 million
Free Cash Flow, excluding gross payments for the settlement of interest rate swaps(1) related to merger financing of $1.4 billion
Building Transformative Nationwide 5G Network and Delivering Merger Synergies
America's largest 5G network covering more than 250 million people across 1.3 million square miles, more than double AT&T's geographic coverage and exponentially more than Verizon
More than 10 percent of Sprint postpaid customer traffic has already been moved over to the T-Mobile network and site decommissioning has begun
Accelerated rationalization of retail stores and organizational redesign to pull forward synergies
(1) Adjusted EBITDA and Free Cash Flow are non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, but not as a substitute for, the information provided in accordance with GAAP. Reconciliations for these non-GAAP financial measures to the most directly comparable financial measures are provided in the Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures tables. We are not able to forecast Net income on a forward-looking basis without unreasonable efforts due to the high variability and difficulty in predicting certain items that affect GAAP Net income including, but not limited to, Income tax expense, stock-based compensation expense and Interest expense. Adjusted EBITDA should not be used to predict Net income as the difference between the two measures is variable.
T-Mobile US, Inc. (NASDAQ: TMUS) reported second quarter results today, highlighted by overtaking AT&T in total branded customers as America's #2 wireless provider and another quarter of industry-leading customer growth. In the company's first quarter since closing the Sprint merger and during an unprecedented social and economic climate, the New T-Mobile established itself as the undisputed growth leader in wireless by continuing to lead the industry in total branded net customer additions for the 22nd consecutive quarter.
Since closing its merger with Sprint on April 1, 2020, T-Mobile has been driving hard on integration and remains highly confident in its ability to unlock massive synergies and build the world's best 5G network. Already, the company has unified employees and customers under one brand, converting thousands of legacy Sprint stores to magenta and adding the tools and systems to serve all customers in all stores. T-Mobile also amped up competition like never before to celebrate this event with its recent supercharged Un-carrier deal - available only for a limited time this summer, customers can get four lines of unlimited data for just $25 each per month plus tax including access to the nation's largest 5G network.
'Surpassing AT&T to become #2 was a huge milestone to kick off Q2, but that was only the beginning! In our first quarter as a combined company, T-Mobile led the industry in total branded customer adds - even in a challenging environment - and there is no doubt that we are THE leading growth company in wireless,' said Mike Sievert, T-Mobile CEO. 'Now we're setting our sights on #1 - in customer choice and customers' hearts - and we'll get there by doing ONLY what the Un-carrier can do: offering customers the most advanced 5G network AND the best value while continuing to make big moves that fix customer pain points and disrupt this industry. I'm excited about what's to come in this new T-Mobile era - we're just getting started!'
For the full release and factbook, go to the T-Mobile Investor Relations page.
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, Metro by T-Mobile and Sprint. For more information please visit: http://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: the failure to realize the expected benefits and synergies of the merger with Sprint Corporation ('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 timeframes, in part or at all; adverse economic, political or market conditions in the U.S. and international markets, including those caused by the coronavirus disease 2019 ('COVID-19') pandemic, and the impact that any of the foregoing may have on us and our customers and other stakeholders; costs of or difficulties in integrating Sprint's network and operations into our network and operations, including intellectual property and communications systems, administrative and information technology infrastructure and accounting, financial reporting and internal control systems; changes in key customers, suppliers, employees or other business relationships as a result of the consummation of the Transactions; the risk that our business, investor confidence in our financial results and stock price may be adversely affected if our internal controls are not effective; the risk of future material weaknesses resulting from the differences between T-Mobile's and Sprint's internal controls environments as we work to integrate and align policies and practices; 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 including the acquisition of Sprint's prepaid wireless business by DISH Network Corporation ('DISH') (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Telecommunications Company and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets (the 'Prepaid Transaction'), the complaint and proposed final judgment agreed to by us, DT, Sprint, 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 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; the ongoing commercial and transition services arrangements entered into in connection with such Prepaid Transaction, which we completed on July 1, 2020; the assumption of significant liabilities, including the liabilities of Sprint in connection with, and significant costs, including financing costs, related to the Transactions; our ability to make payments on debt or to repay existing or future indebtedness when due or to comply with the covenants contained therein; adverse changes in the ratings of our debt securities or adverse conditions in the credit markets; natural disasters, public health crises, including the COVID-19 pandemic, terrorist attacks or similar incidents; competition, industry consolidation and changes in the market for wireless services, which could negatively affect our ability to attract and retain customers; the effects of any future merger, investment, or acquisition involving us, as well as the effects of mergers, investments or acquisitions in the technology, media and telecommunications industry; breaches of our and/or our third-party vendors' networks, information technology and data security, resulting in unauthorized access to customer confidential information; the inability to implement and maintain effective cybersecurity measures over critical business systems; challenges in implementing our business strategies or funding our operations, including payment for additional spectrum or network upgrades; the impact on our networks and business from major system and network failures; difficulties in managing growth in wireless data services, including network quality; material changes in available technology and the effects of such changes, including product substitutions and deployment costs and performance; the timing, scope and financial impact of our deployment of advanced network and business technologies; the occurrence of high fraud rates related to device financing, customer credit cards, dealers, subscriptions or account take over fraud; our inability to retain and hire key personnel; any changes in the regulatory environments in which we operate, including any increase in restrictions on the ability to operate our networks and changes in data privacy laws; unfavorable outcomes of existing or future litigation or regulatory actions, including litigation or regulatory actions related to the Transactions; the possibility that we may be unable to adequately protect our intellectual property rights or be accused of infringing the intellectual property rights of others; changes in tax laws, regulations and existing standards and the resolution of disputes with any taxing jurisdictions; the possibility that we may be unable to renew our spectrum leases on attractive terms or acquire new spectrum licenses or leases at reasonable costs and terms; any disruption or failure of third parties (including key suppliers) to provide products or services; material adverse changes in labor matters, including labor campaigns, negotiations or additional organizing activity, and any resulting financial, operational and/or reputational impact; changes in accounting assumptions that regulatory agencies, including the U.S. Securities and Exchange Commission, may require, which could result in an impact on earnings; and interests of our significant stockholders that may differ from the interests of other stockholders. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law.
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