T-Mobile US, Inc. Quarterly Report for Q1 Ended Mar 31, 2022

Summary

T-Mobile US, Inc. (TMUS) reported its first quarter 2022 financial results, showing continued revenue growth driven primarily by its postpaid segment. Total revenues increased by 2% year-over-year to $20.12 billion, with postpaid revenues growing 9% to $11.20 billion, reflecting an increase in both average postpaid accounts and average revenue per account (ARPA). This growth was partially offset by a decrease in equipment revenues, largely due to a strategic shift from device leasing to installment plans (EIPs). The company's operational efficiency is evident in the increase in Core Adjusted EBITDA, up 10% to $6.46 billion. However, Net Income saw a 24% decrease to $713 million, impacted by significant merger-related costs associated with integrating the Sprint network and operations. Despite these integration costs, T-Mobile demonstrated strong free cash flow generation, increasing by 26% to $1.65 billion. The company also successfully acquired valuable mid-band spectrum in Auction 110 for $2.9 billion, reinforcing its commitment to network expansion and 5G leadership.

Key Highlights

• 1Total revenues grew 2% to $20.12 billion, driven by a 9% increase in postpaid revenues to $11.20 billion.
• 2Core Adjusted EBITDA increased by 10% to $6.46 billion, indicating strong operational performance and cost management.
• 3Net income decreased by 24% to $713 million, significantly impacted by $1.41 billion in merger-related costs during the quarter.
• 4Free Cash Flow saw a substantial increase of 26% to $1.65 billion.
• 5The company spent $2.8 billion in February 2022 for spectrum licenses acquired in FCC Auction 110, bolstering its mid-band spectrum holdings.
• 6Total customers grew 6% to 109.5 million, with postpaid phone customers increasing by 5% to 70.7 million.
• 7Postpaid phone churn improved to 0.93% from 0.98% in the prior year period, signaling enhanced customer retention.

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