Core Insights - T-Mobile, US, Inc. reported strong first-quarter 2025 results, with both net income and revenues exceeding Zacks Consensus Estimates, driven by significant postpaid customer growth [1][2]. Financial Performance - Net income for Q1 2025 was $2.95 billion, or $2.58 per share, reflecting a 24.4% year-over-year increase from $2.37 billion or $2 per share [2]. - Total revenues reached $20.88 billion, up from $19.59 billion in the same quarter last year, surpassing the consensus estimate of $20.57 billion [2]. Segment Results - Total service revenues were $16.92 billion, a 5.2% increase from $16.09 billion year-over-year, primarily driven by demand for postpaid services [3]. - Postpaid services generated $13.59 billion in revenues, marking a 7.6% year-over-year growth [3]. - Prepaid services revenues increased to $2.64 billion from $2.4 billion in the previous year [5]. - Equipment revenues rose to $3.7 billion, up from $3.25 billion, attributed to a higher average revenue per device sold [6]. Customer Growth - T-Mobile added 1.3 million postpaid net customers and 205,000 postpaid net accounts, both leading the industry [4]. - The postpaid phone churn rate was recorded at 0.91%, with postpaid average revenues per account increasing to $146.22 from $140.88 year-over-year [4]. Operating Metrics - Total operating expenses increased to $16.08 billion from $15.59 billion, while operating income rose to $4.8 billion from $3.99 billion [7]. - Core adjusted EBITDA was $8.3 billion, up from $7.65 billion year-over-year [7]. Cash Flow and Liquidity - Cash generated from operating activities was $6.84 billion, compared to $5.08 billion in the prior year [8]. - Adjusted free cash flow increased to $4.39 billion from $3.34 billion year-over-year [8]. - As of March 31, 2025, T-Mobile had $12 billion in cash and cash equivalents and $76 billion in long-term debt [8]. Outlook - For 2025, T-Mobile anticipates postpaid net customer additions between 5.5 million and 6 million, with core adjusted EBITDA estimated at $33.2-$33.7 billion [9]. - Expected cash from operating activities is projected to be within $27-$27.5 billion, with adjusted free cash flow anticipated in the range of $17.5-$18 billion [9].

Core Insights - T-Mobile US Inc's stock has declined by 9.2% to $238.17 despite reporting better-than-expected first-quarter earnings and revenue, primarily due to disappointing subscriber growth [1] - The company added 495,000 monthly bill-paying customers, which was better than competitors AT&T and Verizon, but fell short of analysts' expectations of 506,400 [1] - Year-to-date, T-Mobile's shares are down 8.2%, moving further away from the March 3 record high of $276.49 [2] Options Activity - T-Mobile has seen significant options activity with 8,179 calls and 17,000 puts exchanged, more than double the average daily options volume [3] - The most active options contracts include the weekly 5/2 227.50-strike put and the 235-strike put, with new positions being opened in both [3] Analyst Ratings - RBC Capital is the only firm to adjust its price target post-earnings, raising it to $265 from $260 [4] - Among 30 analysts covering T-Mobile, 19 have a "buy" or better rating, with a 12-month consensus price target of $269.68, representing a 14.2% premium to current levels [4]

Financial Data and Key Metrics Changes - T-Mobile US reported a strong quarter with postpaid service revenues growing 8% year over year and overall service revenues increasing by 5%, which is more than triple the growth rate of the next closest competitor [29][30] - Core adjusted EBITDA also grew 8% year over year, double the average of the wireless peer group [29] - Adjusted free cash flow reached $4.4 billion, a new Q1 record, translating to an industry-leading adjusted free cash flow conversion from service revenues of 26% [30][36] Business Line Data and Key Metrics Changes - The company achieved a record for total postpaid net additions in Q1, with 1.3 million total postpaid net additions and leading in overall gross adds across every postpaid category [11][67] - Postpaid ARPA grew nearly 4%, marking the highest Q1 growth in eight years, with 60% of lines on new accounts loading onto premium plans [14][29] - In broadband, T-Mobile US led the industry with 424,000 net additions in 5G broadband, achieving the lowest churn ever and the highest Q1 ARPU growth [16][29] Market Data and Key Metrics Changes - T-Mobile US continued to grow its share of households across the top 100 markets, not just in smaller markets and rural areas [12] - The company reported strong momentum in the T-Mobile US for Business segment, leading the industry in both total postpaid and postpaid phone net additions [13] Company Strategy and Development Direction - The company is focused on delivering thoughtful, profitable, and durable growth, leveraging its best network and digital capabilities to enhance customer experience [31][48] - T-Mobile US is set to officially launch T Fiber later this quarter, following the completion of the Lumos transaction, aiming to expand broadband choices for more Americans [18][19] - The company is also innovating with T Satellite, which aims to provide seamless connectivity for users, and is priced competitively to attract customers from competitors [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain growth despite macroeconomic uncertainties, noting that customer acceptance of price increases has been strong [61][62] - The management team emphasized that the competitive landscape remains intense but highlighted that overall industry cash flows are significantly higher than in previous years, indicating a healthy market [64][65] - The company expects to deliver total postpaid net customer additions of between 5.5 million and 6 million for the year, with an increase in postpaid ARPA growth expectations to at least 3.5% [34][35] Other Important Information - The company is actively monitoring the impact of potential tariffs on handsets, indicating that customers may bear the cost, which could affect upgrade rates [128][129] - T-Mobile US is seeing stability in its prepaid business, with nearly 25.5 million prepaid customers and a reduction in churn year over year [103][104] Q&A Session Summary Question: What is the biggest opportunity ahead for T-Mobile US? - Management highlighted the opportunity to combine the company's strong culture with its best network and digital capabilities to enhance customer service [48] Question: Can you provide more details on T Fiber and its go-to-market strategy? - The company plans to leverage its existing customer base and retail distribution to drive T Fiber's growth, especially targeting customers on the fixed wireless waitlist [52] Question: How is the company managing churn in light of price increases? - Management noted that the price increases have been well-received, and churn is expected to be temporary as customers adjust to new pricing [62] Question: What is the outlook for broadband additions and fiber growth? - Management expressed confidence in maintaining high-speed Internet fixed wireless additions above 400,000 and anticipates strong growth from fiber once the MetroNet transaction closes [112][119] Question: How is the company addressing potential tariffs on handsets? - Management indicated that any tariff impacts would likely be passed on to customers, potentially slowing upgrade rates, but currently, no material impact is anticipated [128][130]

Core Insights - T-Mobile reported quarterly earnings of $2.58 per share, exceeding the Zacks Consensus Estimate of $2.45 per share, and showing an increase from $2 per share a year ago, resulting in an earnings surprise of 5.31% [1] - The company achieved revenues of $20.89 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 1.49% and up from $19.59 billion year-over-year [2] Financial Performance - T-Mobile has consistently surpassed consensus EPS estimates over the last four quarters, with the latest earnings surprise being 18.43% compared to the expected $2.17 per share [1][2] - The current consensus EPS estimate for the upcoming quarter is $2.69, with projected revenues of $20.63 billion, and for the current fiscal year, the EPS estimate is $10.40 on revenues of $85.27 billion [7] Market Position - T-Mobile shares have increased approximately 17.5% since the beginning of the year, contrasting with the S&P 500's decline of 8.6% [3] - The Zacks Industry Rank places the Wireless National sector in the top 14% of over 250 Zacks industries, indicating a favorable outlook for T-Mobile's performance relative to its peers [8] Future Outlook - The sustainability of T-Mobile's stock price movement will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current estimate revisions trend for T-Mobile is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6]

Financial Data and Key Metrics Changes - T-Mobile reported a strong Q1 2025, with postpaid service revenues growing 8% year over year and overall service revenues increasing by 5% [21][22] - Core adjusted EBITDA also grew 8% year over year, which is double the average of its wireless peer group [22] - Adjusted free cash flow reached $4.4 billion, marking a new Q1 record and translating to an industry-leading adjusted free cash flow conversion from service revenues of 26% [22] Business Line Data and Key Metrics Changes - T-Mobile achieved a record of 1.3 million total postpaid net additions in Q1, leading the industry in both total postpaid and postpaid phone net additions [10][21] - The company added 424,000 net customers in its 5G broadband segment, marking the thirteenth consecutive quarter of leading the broadband industry in customer growth [13] - Postpaid average revenue per account (ARPA) grew nearly 4%, the highest Q1 growth in eight years [11] Market Data and Key Metrics Changes - T-Mobile continued to grow its share of households across the top 100 markets, not just in smaller markets and rural areas [10] - The company reported that 60% of lines on new accounts are opting for premium plans, which is about double the current base [11] - The broadband business saw its highest ever Q1 ARPU growth, indicating strong customer demand [13] Company Strategy and Development Direction - T-Mobile is focused on delivering thoughtful, profitable, and durable growth, leveraging its best network and digital capabilities to enhance customer experience [23] - The company is set to officially launch T Fiber later in Q2, following the completion of its acquisition of Lumos, aiming to expand broadband choices for more Americans [14] - T-Mobile is also innovating with its T Satellite service, which aims to keep customers connected automatically, with commercial service starting in July [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain growth despite macroeconomic changes, emphasizing a strong focus on execution and customer service [8][23] - The management team highlighted that the competitive landscape remains intense, but T-Mobile's differentiated value proposition continues to resonate with customers [60] - The company expects to deliver total postpaid net customer additions of between 5.5 million and 6 million for the full year, with an increase in postpaid ARPA growth expectations to at least 3.5% [26] Other Important Information - T-Mobile's digital platform, TLIFE, has seen significant adoption, with over half of postpaid phone upgrades completed digitally by the end of Q1 [20] - The company is actively pursuing M&A opportunities, including the recent acquisition of Lumos and plans for MetroNet, which are expected to contribute positively to service revenues [29][75] Q&A Session Summary Question: What is the biggest opportunity ahead for T-Mobile? - Management highlighted the combination of a strong customer-focused culture, the best network, and advanced digital capabilities as key opportunities for growth [36][38] Question: Can you provide more details on T Fiber and its market approach? - T-Mobile plans to leverage its existing customer base and retail distribution to drive T Fiber's growth, particularly targeting customers on the fixed wireless waitlist [40][41] Question: How is T-Mobile managing pricing and churn? - Management indicated that recent price increases have been well-received, and churn rates are expected to be temporary as customers adjust [52][53] Question: What is the outlook for broadband contributions to postpaid net additions? - While specific guidance was not provided, management expressed confidence in maintaining strong growth in broadband and fiber segments [102] Question: How is T-Mobile addressing potential tariff impacts on handsets? - Management noted that any significant tariffs would likely be passed on to customers, potentially affecting upgrade rates, but currently, no material impact is anticipated [110][111] Question: What is the current state of the prepaid market? - T-Mobile's prepaid segment remains stable, with continued growth and reduced churn year over year, indicating resilience in this market [88][90]

Mergers and Acquisitions - As of March 31, 2025, net cash payments for Sprint Merger-related costs were $61 million, compared to $293 million for the same period in 2024[187]. - T-Mobile invested $926 million to acquire a 50% equity interest in the Lumos joint venture, with an expected additional capital contribution of approximately $500 million in 2027 or 2028[190]. - The acquisition of Metronet is expected to close in mid-2025, with T-Mobile planning to invest approximately $4.9 billion for a 50% equity interest[191]. - T-Mobile completed the acquisition of Ka'ena Corporation for a total payment fair value of $956 million, including $420 million in cash and stock[193]. - The UScellular acquisition is valued at approximately $4.4 billion, with expected annual run rate cost synergies of $1.0 billion upon integration[198]. - T-Mobile acquired Vistar Media Inc. for $621 million, enhancing its technology solutions for digital-out-of-home advertisements[200]. - The acquisition of Blis Holdco Limited was completed for $180 million, expanding T-Mobile's advertising solutions capabilities[202]. - The company completed the acquisition of Vistar Media Inc. for $621 million and Blis Holdco Limited for $180 million in early 2025[277][278]. - The company entered into a securities purchase agreement to acquire UScellular's wireless operations for approximately $4.4 billion, expected to close in mid-2025[273]. Financial Performance - Total revenues increased by $1.3 billion, or 7%, from $19.6 billion in Q1 2024 to $20.9 billion in Q1 2025[205]. - Postpaid revenues rose by $963 million, or 8%, while prepaid revenues increased by $240 million, or 10%[206]. - Total operating expenses increased by $490 million, or 3%, with cost of services decreasing by $86 million, or 3%[207]. - Operating income grew by $802 million, or 20%, reaching $4.8 billion in Q1 2025[209]. - Net income for Q1 2025 was $2.95 billion, a 24% increase from $2.37 billion in Q1 2024[215]. - Adjusted EBITDA rose by $607 million, or 8%, reaching $8.26 billion in Q1 2025[215]. - Net cash provided by operating activities increased by $1.76 billion, or 35%, totaling $6.85 billion[215]. - Equipment revenues increased by $453 million, or 14%, totaling $3.7 billion in Q1 2025[205]. - Income tax expense increased by $121 million, or 16%, with an effective tax rate of 23.0% for Q1 2025[215]. - Adjusted EBITDA increased by $607 million, or 8%, to $8,259 million for the three months ended March 31, 2025[244]. - Core Adjusted EBITDA rose by $641 million, or 8%, to $8,258 million, reflecting improved operational performance[246]. - Net income for the period increased by $579 million, or 24%, to $2,953 million[244]. Customer Metrics - The number of postpaid accounts increased by 1,084 thousand, or 4%, from 30,015 thousand in Q1 2024 to 31,099 thousand in Q1 2025[227]. - Total postpaid customers increased by 6,183, or 6%, reaching 105,455, while prepaid customers rose by 3,855, or 18%, totaling 25,455 as of March 31, 2025[230]. - Total net customer additions increased by 210,000, or 18%, driven by higher net additions from postpaid other customers and prepaid customers[231]. - Postpaid net account additions decreased by 13,000, or 6%, for the three months ended March 31, 2025, primarily due to higher account deactivations[228]. - Postpaid phone churn increased by 5 basis points to 0.91%, while prepaid churn decreased by 7 basis points to 2.68%[233]. - Postpaid Average Revenue per Account (ARPA) increased by $5.34, or 4%, to $146.22, reflecting higher revenue realization[237]. - Postpaid phone Average Revenue per User (ARPU) rose by $0.59, or 1%, to $49.38, while prepaid ARPU decreased by $2.51, or 7%, to $34.67[238]. Cash Flow and Liquidity - Net cash provided by operating activities increased by $1.8 billion, or 35%, to $6.847 billion for the three months ended March 31, 2025, compared to $5.084 billion in 2024[251]. - Net cash used in investing activities rose by $1.6 billion, or 91%, totaling $(3.409) billion, primarily due to $2.5 billion in purchases of property and equipment for the 5G network build-out[251][253]. - Adjusted Free Cash Flow increased by $1.0 billion, or 31%, reaching $4.396 billion, with an Adjusted Free Cash Flow margin of 26%, up from 21%[255]. - As of March 31, 2025, total cash and cash equivalents were $12.0 billion, significantly up from $5.4 billion at December 31, 2024[252]. - The company’s liquidity sources include cash and cash equivalents, cash generated from operations, and proceeds from debt issuance[249]. - A revolving credit facility of $7.5 billion was maintained with no outstanding balance as of March 31, 2025[258]. - The company expects to enter into up to $1.2 billion in financing lease commitments during the year ending December 31, 2025, with $10.2 billion already executed as of March 31, 2025[284]. Debt and Capital Expenditures - Total debt and financing lease liabilities amounted to $88.0 billion, with $77.5 billion classified as long-term debt[262]. - The company remains in compliance with all restrictive debt covenants as of March 31, 2025[283]. - The company plans to maintain its capital expenditures in 2025 at levels comparable to 2024, primarily driven by the deployment of acquired spectrum licenses[285]. Stockholder Returns - The 2025 Stockholder Return Program is authorized for up to $14.0 billion, which includes share repurchases and cash dividends through December 31, 2025[287]. - During the three months ended March 31, 2025, the company paid $1.0 billion in cash dividends and repurchased 10,091,227 shares for a total of $2.5 billion[290][291]. - As of March 31, 2025, the company had $10.5 billion remaining under the 2025 Stockholder Return Program for share repurchases and dividends[291]. - The company has approximately $50.0 billion allocated for share repurchases and cash dividends, with an additional $19.0 billion for discretionary activities[296]. Risks and Challenges - The company faces risks related to competition, market conditions, and regulatory approvals that could affect future performance[184]. - T-Mobile's substantial level of indebtedness may impact its ability to service debt obligations[184]. - The company incurred substantial expenses related to the Sprint Merger, with cash expenditures extending beyond 2024[282]. - As of March 31, 2025, the company derecognized net receivables of $1.6 billion from off-balance sheet arrangements[280].

EXHIBIT 99.2 | 3 | Highlights | | --- | --- | | 4 | Customer Metrics | | 7 | Financial Metrics | | 13 | Capital Structure | | 14 | Guidance | | 15 | Contacts | | 16 | Financial and Operational Tables | 3 2 (in thousands) Year-Over-Year Postpaid ARPA increased 4% primarily due to: Postpaid phone ARPU increased 1% due to: (1) AT&T Inc. historically does not disclose postpaid net account additions. Comcast and Charter do not disclose postpaid phone net customer additions. Industry leading claims are based on c ...

Wall Street analysts forecast that T-Mobile (TMUS) will report quarterly earnings of $2.45 per share in its upcoming release, pointing to a year-over-year increase of 22.5%. It is anticipated that revenues will amount to $20.59 billion, exhibiting an increase of 5.1% compared to the year-ago quarter.The current level reflects a downward revision of 0.3% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised the ...

Group 1: T-Mobile US, Inc. (TMUS) - T-Mobile's shares have outperformed the Zacks Wireless National industry over the past year, with a growth of +62.2% compared to +45.5% for the industry [4] - The company achieved a significant increase in service revenues, driven by the addition of 6.1 million postpaid net customers in 2024, marking the best performance in the industry [4][5] - Solid growth in free cash flow indicates efficient capital management, positioning the company well for growth initiatives, debt repayment, and dividends [5] Group 2: Salesforce, Inc. (CRM) - Salesforce shares have underperformed the Zacks Computer - Software industry over the past year, declining by -12.8% compared to -6% for the industry [7] - The company is experiencing strong demand due to customers undergoing digital transformation, which is positively impacting revenue [8] - Continued international deal wins and the acquisition of Slack enhance its competitive position, with projected revenue growth at a CAGR of 8.9% through fiscal 2025-2028 [9] Group 3: Alibaba Group Holding Ltd. (BABA) - Alibaba's shares have outperformed the Zacks Internet - Commerce industry over the past year, increasing by +49.3% compared to +4.8% for the industry [10] - The company's growth is supported by the monetization of Taobao and Tmall, as well as strong performance in its international commerce retail business [10][11] - Despite strong performance, non-GAAP earnings of $2.93 per ADS fell short of estimates, indicating a complex growth narrative [11] Group 4: Old Point Financial Corp. (OPOF) - Old Point Financial shares have significantly outperformed the Zacks Banks - Southeast industry, with a growth of +158.2% compared to +5.1% for the industry [12] - The company has recorded earnings of $2.02 for 2024 and projected 2025 EPS, supporting a valuation upside at 12.5X forward P/E [12][13] - Efficiency improvements are evident with a 2% drop in noninterest expenses and an improved efficiency ratio, contributing to a ROAE of 9.96% and ROAA of 0.77% [13]

Core Viewpoint - T-Mobile has received an upgrade to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, indicating a positive earnings outlook that could lead to increased stock price [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system emphasizes the importance of changing earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Rising earnings estimates for T-Mobile suggest an improvement in the company's underlying business, which may drive investor interest and push the stock price higher [5][10]. Recent Earnings Estimate Revisions - For the fiscal year ending December 2025, T-Mobile is expected to earn $10.41 per share, reflecting a 7.8% increase from the previous year [8]. - Over the past three months, the Zacks Consensus Estimate for T-Mobile has increased by 2.6%, indicating a positive trend in earnings expectations [8]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% of stocks receiving a 'Strong Buy' or 'Buy' rating [9][10]. - T-Mobile's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].