Company Overview

T-Mobile US, Inc., together with its subsidiaries, provides wireless communications services in the United States, Puerto Rico, and the United States Virgin Islands. The company offers voice, messaging, and data services to postpaid, prepaid, and wholesale and other services customers. Founded in 1994, T-Mobile US is headquartered in Bellevue, Washington, and operates as a significant subsidiary of Deutsche Telekom AG.

Business Operations and Services

T-Mobile offers a comprehensive suite of wireless services and devices, including smartphones, wearables, tablets, home broadband routers, and other mobile communication devices, along with accessories. Financing options are available through equipment installment plans. The company also provides reinsurance for device insurance policies and extended warranty contracts, as well as high-speed internet services. T-Mobile markets its services and devices under the T-Mobile, Metro by T-Mobile, and Mint Mobile brands. These offerings are accessible through a network of owned and operated retail stores, customer care channels, national retailers, and their respective websites and apps.

The company primarily utilizes its advanced 4G Long Term Evolution (LTE) network and its leading 5G technology network to deliver these services. T-Mobile has positioned itself as a technology leader in the wireless industry through continuous investment in network infrastructure and innovative service development.

Network Leadership and Technology

T-Mobile has consistently been recognized for its superior network performance and expansive coverage. For the fourth consecutive year, T-Mobile secured the award for best 5G availability globally, being the only U.S. operator to earn a 5G Global Winner award in this category from Opensignal. The company also maintains the largest Voice over New Radio (VoNR) coverage, extending to over 300 million Americans, which further enhances performance and spectral efficiency.

Financial Performance

Q4 2024 Performance

In the fourth quarter of 2024, T-Mobile reported a significant increase in net income, rising to $2.98 billion or $2.57 per share, up from $2.01 billion or $1.67 per share in the same period of the prior year. Total revenue saw a year-over-year increase of 6.8%, reaching $21.87 billion for the quarter. Service revenues contributed $16.9 billion of this total.

Key financial metrics for Q4 2024 include:

• Adjusted EBITDA: $7.92 billion, a 9.6% increase from the previous year.

• Core Adjusted EBITDA: Increased by 10% annually to $7.91 billion from $7.18 billion in Q4 2023.

• Net Cash Provided by Operating Activities: $5.55 billion, up 14.2% year-over-year.

Full Year 2024 Performance

For the full fiscal year 2024, T-Mobile US reported total revenue of $81.40 billion, an increase of 3.62% compared to $78.56 billion in the previous year. Earnings also saw substantial growth, reaching $11.34 billion, marking a 36.34% increase.

Key financial achievements for the full year 2024:

• Net Income: Grew by 36% year-over-year to $11.3 billion.

• Diluted EPS: Increased by 39% year-over-year to $9.66 per share.

• Core Adjusted EBITDA: Rose by 9% year-over-year to $31.8 billion.

• Free Cash Flow: Reached a record high of $17 billion, with a cash flow conversion from service revenues of 26%.

Customer Growth and Market Position

T-Mobile demonstrated exceptional performance in customer acquisition and retention throughout 2024. The company achieved industry-leading customer growth across all segments, including postpaid accounts, total postpaid, postpaid phone, prepaid, and High Speed Internet customers. T-Mobile also matched its lowest-ever Q4 postpaid phone churn rate and recorded a best-ever full-year postpaid phone churn rate, alongside its highest-ever postpaid phone gross additions.

Key customer metrics from 2024:

• Postpaid Net Customer Additions: 1.9 million in Q4 2024 and 6.1 million for the full year, both industry-leading figures.

• Postpaid Phone Net Customer Additions: 903 thousand in Q4 2024 and 3.1 million for the full year, also industry bests.

• Postpaid Phone Churn: 0.92% in Q4 2024 (tied for lowest Q4) and 0.86% for the full year (best FY in company history).

Leadership Transition

T-Mobile US announced a significant leadership change, with COO Srini Gopalan set to take over as CEO on November 1, succeeding Mike Sievert. This transition is expected to ensure leadership continuity while continuing to drive growth in network and broadband services.

Capital Allocation and Shareholder Returns

T-Mobile maintains a robust capital allocation strategy, balancing investments for growth with shareholder value creation. In 2024, the company leveraged its industry-leading customer growth to achieve top-tier service revenue and cash flow growth, while returning approximately $14.4 billion to stockholders, in line with its multiyear growth plan.

Key aspects of the shareholder return program:

• Share Repurchases: In Q3 2024, 3.2 million shares of common stock were repurchased for $644 million. As of September 30, 2024, cumulative repurchases reached 153.4 million shares for $22.7 billion.

• Dividends: The next dividend of $0.88 per share was payable on December 12, 2024.

• Dividend Yield: T-Mobile US, Inc. had a dividend yield of 1.28% in 2024, with a payout ratio of 29.28%.

Future Outlook and Growth Strategy

T-Mobile has outlined ambitious growth targets for 2025 and beyond, emphasizing continued network expansion and service innovation.

Key guidance for 2025:

• Postpaid Customer Net Additions: Projected at 5.5 million to 6 million.

• Service Revenue Growth: Expected to be approximately 5% for the full year.

• Core Adjusted EBITDA: Guidance is set between $33.1 billion and $33.6 billion.

Additional financial projections for 2025:

• Cash CapEx: Expected to be around $9.5 billion.

• Adjusted Free Cash Flow: Projected to be between $17.3 billion and $18 billion.

At its recent Capital Markets Day, T-Mobile detailed plans to drive long-term value creation through 2027, anticipating continued industry-leading profitability growth. This is expected to generate substantial cash flows, supporting an estimated $80 billion capacity for investments and shareholder returns through 2027.

T-Mobile US continues to exhibit strong operational execution, financial discipline, and strategic positioning within the competitive wireless communications market, solidifying its role as a significant industry player with robust growth prospects and a consistent commitment to shareholder value.