10-KPeriod: FY2022

T-Mobile US, Inc. Annual Report, Year Ended Dec 31, 2022

Filed February 14, 2023For Securities:TMUSTMUSZTMUSITMUSL

Summary

T-Mobile US, Inc. (TMUS) reported its annual results for the year ended December 31, 2022. The company continues to execute its 'Un-carrier' strategy, focusing on customer experience and network expansion. Total revenues saw a slight decrease of 1% year-over-year, primarily due to a decline in equipment revenues, while postpaid revenues saw a healthy increase of 8%. Operating expenses were relatively stable, but the company incurred significant merger-related costs and a substantial loss on the sale of its Wireline Business. Despite these factors, T-Mobile demonstrated strong operational performance with an increase in postpaid customer accounts and net additions, alongside improvements in postpaid ARPA and a decrease in churn rates for both postpaid phone and prepaid customers. The company made significant investments in spectrum acquisition and network modernization, particularly in its 5G network deployment. Management remains optimistic about future service revenue growth, driven by continued postpaid customer acquisition and ARPA increases. The company also authorized a substantial stock repurchase program, indicating a commitment to returning value to shareholders. Key areas of focus moving forward include realizing further merger synergies, managing integration activities, and continuing network development to maintain its competitive edge.

Financial Highlights

53 data points
Beta

Revenue

$79.57B

Net Income

$2.59B

3.3% Net Margin

EPS (Diluted)

$2.06

Total Assets

$211.34B

Cash & Equivalents

$4.51B

Free Cash Flow

$2.81B

Financial Statements
Beta
Revenue$79.57B
SG&A Expenses$21.61B
Operating Expenses$73.03B
Operating Income$6.54B
Net Income$2.59B
EPS (Basic)$2.07
EPS (Diluted)$2.06
Shares Outstanding (Basic)1.25B
Shares Outstanding (Diluted)1.26B

Key Highlights

  • 1Total revenues decreased by 1% to $79.57 billion, primarily impacted by a 17% decline in equipment revenues.
  • 2Postpaid revenues increased by 8% to $45.92 billion, driven by higher average postpaid accounts and ARPA.
  • 3Total operating expenses remained stable at $73.03 billion, but included significant merger-related costs and a $1.1 billion loss on the disposal of the Wireline Business.
  • 4Free Cash Flow increased by 36% to $7.66 billion, reflecting improved operating cash flows and proceeds from securitization transactions.
  • 5Postpaid net customer additions increased by 21% to 1.44 million, with strong growth in High Speed Internet customers.
  • 6Postpaid phone churn decreased by 10 basis points to 0.88%, indicating improved customer retention.
  • 7The company repurchased $3.0 billion of its common stock under its 2022 Stock Repurchase Program.

Frequently Asked Questions

T-Mobile reported total revenues of $79.57 billion for the year ended December 31, 2022, a slight decrease of 1% compared to the prior year. This was primarily driven by a 17% decline in equipment revenues, while postpaid revenues saw a significant increase of 8%.

T-Mobile continued to expand its 5G network, covering 263 million people with its Ultra Capacity 5G and 98% of Americans with its total 5G coverage. The company made significant investments in spectrum acquisition, including purchases in the C-band, 3.45 GHz, and 2.5 GHz bands, to enhance its network capabilities.

T-Mobile expects service revenues to continue growing in 2023, driven by sustained postpaid account and customer growth, as well as increases in postpaid ARPA. The company aims to deepen customer relationships and expand its High Speed Internet offering, which contributed significantly to customer growth in 2022.

T-Mobile identifies several key risks, including intense competition in the wireless industry, cybersecurity threats leading to data breaches, the need to keep pace with technological developments, managing significant indebtedness, and regulatory changes. The company also notes the challenges associated with integrating the Sprint merger and fulfilling numerous government commitments.