How strong were T-Mobile's customer additions in Q2 2025 compared with prior periods?

Postpaid net customer additions were 1.7 million, up 394 thousand from Q2 2024, and postpaid phone net adds were 830 thousand, up 53 thousand. Both are the best Q2 totals in the company's history. Postpaid net account additions were 318 thousand, up 6% year-over-year. Prepaid net adds fell to 39 thousand from 179 thousand a year earlier, mainly due to deactivations tied to the Ka'ena (Mint/Ultra Mobile) acquisition base and higher churn.

Is the growth in operating cash flow and free cash flow sustainable?

Part of the 27% jump in operating cash flow reflects an accounting change effective November 1, 2024, which moved receivable sale proceeds from investing into operating cash flows, and it also reflects lower working capital outflows. Adjusted Free Cash Flow, which is unaffected by that reclassification, grew a more modest 4%. Full-year guidance of $17.6–18.0 billion in Adjusted Free Cash Flow implies continued but moderate growth, and the company states that guidance assumes no material net cash inflows from securitization.

What risks or soft spots did the quarter reveal?

Postpaid phone churn rose 10 basis points year-over-year to 0.90%, which management attributes mainly to the temporary effects of current-year rate plan optimizations. Prepaid churn also increased to 2.65%. Cost of equipment sales rose 14% year-over-year on a higher-end phone mix, and SG&A increased 5%. Q2 SG&A was helped by a $151 million gain from the sale of part of the 3.45 GHz spectrum, so underlying cost growth was higher than the headline figure.

What changed in the 2025 outlook, and what is excluded?

Guidance was raised for postpaid net customer additions (to 6.1–6.4 million), Core Adjusted EBITDA (midpoint up $50 million to a $33.3–33.7 billion range), operating cash flow, and Adjusted Free Cash Flow (each midpoint up $50 million). Capital expenditures remain about $9.5 billion and the effective tax rate range is unchanged at 24–26%. The outlook includes Metronet, expected to close July 24, 2025, but excludes the pending acquisition of UScellular. The company does not forecast GAAP net income because of variability in taxes and interest expense.

How is T-Mobile returning capital to shareholders?

In Q2 2025, T-Mobile repurchased about 10.1 million shares for roughly $2.5 billion and paid a $0.88 per share dividend totaling about $996 million. These are part of a stockholder return program of up to $14.0 billion running through December 31, 2025. Since the program began in Q3 2022, cumulative returns total $38.3 billion, including $32.3 billion in repurchases and $6.0 billion in dividends. Net debt excluding tower obligations was $75.0 billion at quarter-end.

T-Mobile US, Inc. 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed July 23, 2025. Cited figures are marked; the original filing is the authoritative source.

T-Mobile US (TMUS) reported Q2 2025 results on July 23, 2025, highlighting its strongest second quarter on record for customer growth and a raise to full-year 2025 guidance.

Postpaid net customer additions were 1.7 million, including 830 thousand postpaid phone net adds, both best-ever for a Q2 and described by management as best in the industry. Postpaid service revenues grew 9% year-over-year to $14.1 billion^a, total service revenues rose 6% to $17.4 billion, and net income reached a record $3.2 billion, up 10%. Diluted EPS was $2.84, up 14%, and Core Adjusted EBITDA grew 6% to $8.5 billion.

Cash generation was strong. Net cash provided by operating activities rose 27% to $7.0 billion^b, and Adjusted Free Cash Flow grew 4% to $4.6 billion, a record Q2. Part of the operating cash flow increase reflects an accounting change effective November 1, 2024 that moved receivable sale proceeds from investing into operating cash flows, so year-over-year comparisons are flattered on that line.

The company returned $3.5 billion^c to stockholders in the quarter, including $2.5 billion in buybacks and $996 million in dividends. Net debt excluding tower obligations was $75.0 billion, and management still targets a net debt to Core Adjusted EBITDA ratio of about 2.5x at year-end 2025. Full-year 2025 guidance was raised modestly.

Postpaid net customer additions are now expected at 6.1 to 6.4 million (up from 5.5 to 6.0 million), Core Adjusted EBITDA at $33.3 to $33.7 billion^d, operating cash flow at $27.1 to $27.5 billion, and Adjusted Free Cash Flow at $17.6 to $18.0 billion. Capital expenditures are unchanged at about $9.5 billion.

The guidance includes Metronet, expected to close July 24, and excludes the pending UScellular acquisition. Investors should weigh the strong subscriber momentum against rising postpaid phone churn (up 10 basis points year-over-year to 0.90%), a prepaid base that shrank sharply in net adds, and the temporary effects of rate plan optimizations.

02—Key points

Key Highlights

Postpaid net customer additions of 1.7 million, the best-ever Q2 total and up 394 thousand year-over-year; postpaid phone net adds of 830 thousand, also a Q2 record
Total service revenues of $17.4 billion (+6% YoY) and Postpaid service revenues of $14.1 billion (+9% YoY), driven by higher postpaid ARPA (+5%) and a growing account base
Net income of $3.2 billion (+10% YoY, a company record) and diluted EPS of $2.84 (+14% YoY, highest-ever Q2)
Core Adjusted EBITDA of $8.5 billion (+6% YoY) with a 49.0% margin on service revenues
Net cash from operations of $7.0 billion (+27% YoY) and Adjusted Free Cash Flow of $4.6 billion (+4% YoY), though the operating cash flow growth partly reflects a November 2024 accounting reclassification of receivable sale proceeds
Raised 2025 guidance: postpaid net adds to 6.1–6.4 million (from 5.5–6.0 million), Core Adjusted EBITDA to $33.3–33.7 billion, and Adjusted Free Cash Flow to $17.6–18.0 billion; capex unchanged at ~$9.5 billion
Returned $3.5 billion to stockholders in Q2 ($2.5B buybacks, $996M dividends); cumulative returns of $38.3 billion under the program, with net debt of $75.0 billion and a ~2.5x leverage target at year-end 2025

03—Questions

Frequently Asked Questions

How strong were T-Mobile's customer additions in Q2 2025 compared with prior periods?
Postpaid net customer additions were 1.7 million, up 394 thousand from Q2 2024, and postpaid phone net adds were 830 thousand, up 53 thousand. Both are the best Q2 totals in the company's history. Postpaid net account additions were 318 thousand, up 6% year-over-year. Prepaid net adds fell to 39 thousand from 179 thousand a year earlier, mainly due to deactivations tied to the Ka'ena (Mint/Ultra Mobile) acquisition base and higher churn.
Is the growth in operating cash flow and free cash flow sustainable?
Part of the 27% jump in operating cash flow reflects an accounting change effective November 1, 2024, which moved receivable sale proceeds from investing into operating cash flows, and it also reflects lower working capital outflows. Adjusted Free Cash Flow, which is unaffected by that reclassification, grew a more modest 4%. Full-year guidance of $17.6–18.0 billion in Adjusted Free Cash Flow implies continued but moderate growth, and the company states that guidance assumes no material net cash inflows from securitization.
What risks or soft spots did the quarter reveal?
Postpaid phone churn rose 10 basis points year-over-year to 0.90%, which management attributes mainly to the temporary effects of current-year rate plan optimizations. Prepaid churn also increased to 2.65%. Cost of equipment sales rose 14% year-over-year on a higher-end phone mix, and SG&A increased 5%. Q2 SG&A was helped by a $151 million gain from the sale of part of the 3.45 GHz spectrum, so underlying cost growth was higher than the headline figure.
What changed in the 2025 outlook, and what is excluded?
Guidance was raised for postpaid net customer additions (to 6.1–6.4 million), Core Adjusted EBITDA (midpoint up $50 million to a $33.3–33.7 billion range), operating cash flow, and Adjusted Free Cash Flow (each midpoint up $50 million). Capital expenditures remain about $9.5 billion and the effective tax rate range is unchanged at 24–26%. The outlook includes Metronet, expected to close July 24, 2025, but excludes the pending acquisition of UScellular. The company does not forecast GAAP net income because of variability in taxes and interest expense.
How is T-Mobile returning capital to shareholders?
In Q2 2025, T-Mobile repurchased about 10.1 million shares for roughly $2.5 billion and paid a $0.88 per share dividend totaling about $996 million. These are part of a stockholder return program of up to $14.0 billion running through December 31, 2025. Since the program began in Q3 2022, cumulative returns total $38.3 billion, including $32.3 billion in repurchases and $6.0 billion in dividends. Net debt excluding tower obligations was $75.0 billion at quarter-end.

04—Continue

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