T-Mobile US, Inc. Q3 FY2024 earnings call

• Acknowledged team's hard work in response to hurricanes Helene and Milton. - Q3 was a strong quarter with consistent execution, enabling raising of 2024 guidance. - Mobile business: Strong postpaid phone net adds, low churn, leading share of switchers. - Digitalization: Total digital mix of iPhone launch sales up 40% year-over-year, majority of T-Mobile branded iPhone pre-orders digital. - Broadband: Industry-leading net adds, 6 million customers in 3 years, on track to 12 million by 2028, leading 5G network. - Financials: Profitable customer growth, industry-leading service revenue growth, core adjusted EBITDA growth 9%, industry-leading free cash flow conversion.

The mobile business delivered the best Q3 postpaid phone net adds in a decade, with record low Q3 postpaid phone churn and year-over-year growth in gross adds, leading share of switchers and growing share of households in various markets. The broadband segment delivered industry-leading net adds, reaching 6 million customers in 3 years and on track to 12 million by 2028, powered by its leading 5G network. Revenue contribution details: Mobile business and broadband are key segments with strong performance driving overall results.

• Raised total postpaid customer net additions to 5.6-5.8 million, with postpaid phone net additions expected to be ~3 million. - Postpaid ARPA expected to be up ~3% year-over-year. - Core adjusted EBITDA projected between $31.6 billion and $31.8 billion. - Cash CapEx expected between $8.8 billion and $9 billion. - Adjusted free cash flow expected between $16.7 billion and $17 billion.

• Regulatory risks related to spectrum usage and approvals for initiatives like direct-to-device service. - Impact of ACP decline and TracFone transition on wholesale performance. - Uncertainty around handset upgrade cycles and macroeconomic factors affecting consumer wireless behavior.

Q: Simon Flannery asks about buyback pacing and wholesale impacts.

A: Peter Osvaldik talks about buyback strategy change due to share price movements and wholesale dynamics including ACP decline and TracFone transition.

Q: John Hodulik inquires about spectrum strategy and digitalization upside.

A: Ulf Ewaldsson discusses spectrum portfolio and digitalization markers like reduced person-to-person interactions and increased digital activations.

Q: David Barden asks about DT's ownership interest and postpaid phone ARPU.

A: Mike Sievert and Peter Osvaldik discuss DT's ownership plans and ARPU driven by customer relationship expansion.

Q: Michael Rollins asks about SMRA penetration and ARPU strength.

A: Jon Freier talks about SMRA growth and Peter Osvaldik discusses ARPA driven by customer relationship expansion.

Q: Jonathan Chaplin asks about 800 MHz spectrum and AT&T's wholesale network.

A: Mike Sievert and Ulf Ewaldsson discuss 800 MHz spectrum optionality and AT&T's wholesale network potential.

Q: Craig Moffett asks about handset upgrade rates and future cycles.

A: Michael Katz and Ulf Ewaldsson talk about current upgrade rates and future handset cycle preparedness.

Q: James Schneider asks about network upgrades and rural markets.

A: Ulf Ewaldsson discusses customer-driven coverage and spectrum deployment strategy.

Q: Peter Supino asks about 6G cycle and spectrum costs.

A: Mike Sievert talks about AI-RAN and potential efficiency in 6G cycle.

Q: Sam McHugh asks about US Cellular deal and ARPU drivers.

A: Michael Katz and Mark Nelson discuss US Cellular deal progress and Peter Osvaldik talks about ARPA drivers.

Q: Kannan Venkateshwar asks about pricing and volume growth.

A: Mike Sievert talks about pricing strategy and consistent growth approach.

Q: Eric Luebchow asks about fixed wireless business and geographical split.

A: Mike Sievert discusses fixed wireless business performance and customer experience.