T-Mobile(US:TMUS)2024-10-23 20:06Merger and Acquisition Activities - T-Mobile reported a total merger-related cost of $121 million for the nine months ended September 30, 2024, a decrease of $665 million or 85% compared to the same period in 2023[165]. - The company recognized a gain of $100 million from the DISH License Purchase Agreement, which was recorded as a reduction in selling, general, and administrative expenses[163]. - T-Mobile plans to invest approximately $950 million in a joint venture to acquire a 50% equity interest in Lumos, a fiber-to-the-home platform, expected to close in early 2025[166]. - A definitive agreement was made with KKR to establish a joint venture for acquiring Metronet, with an expected investment of $4.9 billion for a 50% equity interest, anticipated to close in 2025[167]. - The total purchase price for the acquisition of Ka'ena Corporation was approximately $956 million, consisting of $420 million in cash and 3,264,952 shares of T-Mobile common stock[169]. - Up to an additional $403 million may be payable as an earnout based on Ka'ena's performance indicators following the acquisition[170]. - UScellular's wireless operations and select spectrum assets will be acquired for approximately $4.4 billion, including up to $2.0 billion in debt assumption[171]. Financial Performance - Total revenues increased by $910 million, or 5%, for the three months ended September 30, 2024, and by $1.4 billion, or 2%, for the nine months ended[177]. - Postpaid revenues rose by $1.0 billion, or 8%, for the three months and by $2.6 billion, or 7%, for the nine months ended September 30, 2024[177]. - Prepaid revenues increased by $243 million, or 10%, for the three months and by $377 million, or 5%, for the nine months ended September 30, 2024[178]. - Wholesale and other service revenues decreased by $452 million, or 39%, for the three months and by $943 million, or 26%, for the nine months ended[178]. - Total operating expenses decreased by $290 million, or 2%, for the three months and by $1.19 billion, or 3%, for the nine months ended[174]. - Operating income increased by $1.2 billion, or 33%, for the three months and by $2.64 billion, or 24%, for the nine months ended[174]. - Adjusted EBITDA rose to $8.243 billion, an increase of $643 million, or 8%, for the three months ended[175]. - Cash provided by operating activities was $6.139 billion, an increase of $845 million, or 16%, for the three months ended[175]. - Net income was $3.1 billion for the three months ended September 30, 2024, compared to $2.1 billion for the same period in 2023, and $8.4 billion for the nine months ended September 30, 2024, compared to $6.3 billion for 2023[188]. - Income before income taxes was $4.0 billion for the three months ended September 30, 2024, compared to $2.8 billion for the same period in 2023, and $10.9 billion for the nine months ended September 30, 2024, compared to $8.4 billion for 2023[186]. Cost Management - The company has incurred substantially all restructuring and integration costs associated with the Sprint Merger, with cash payments extending beyond 2024[164]. - T-Mobile's net cash payments for merger-related costs were $658 million for the nine months ended September 30, 2024, a decrease of $899 million or 58% compared to the same period in 2023[165]. - T-Mobile's total merger-related costs for the three months ended September 30, 2024, were $0, compared to $152 million for the same period in 2023[165]. - Selling, general and administrative expenses decreased by $148 million, or 3%, for the three months ended and decreased by $565 million, or 4%, for the nine months ended September 30, 2024[183]. - Cost of services decreased by $164 million, or 6%, for the three months ended September 30, 2024[182]. - Cost of equipment sales increased by $58 million, or 1%, for the three months ended September 30, 2024[182]. Customer Metrics - Postpaid accounts increased to 30,631,000 as of September 30, 2024, up 1,133,000 or 4% from 29,498,000 as of September 30, 2023[201]. - Total customers increased to 127,492,000 as of September 30, 2024, up 9,585,000 or 8% from 117,907,000 as of September 30, 2023[205]. - Postpaid net account additions decreased by 71,000 or 18% for the three months ended September 30, 2024, and decreased by 138,000 or 14% for the nine months ended September 30, 2024[202]. - Postpaid Average Revenue Per Account (ARPA) increased by $5.77 or 4% for the three months ended September 30, 2024, reaching $145.60[212]. - Postpaid phone churn decreased slightly to 0.86% for the three months ended September 30, 2024, compared to 0.87% for the same period in 2023[209]. - Prepaid churn decreased by 3 basis points for the three months ended September 30, 2024, primarily due to promotional activity[210]. Cash Flow and Debt - Cash and cash equivalents increased to $9.8 billion as of September 30, 2024, up from $5.1 billion at December 31, 2023[233]. - Net cash provided by operating activities for the nine months ended September 30, 2024, was $16.744 billion, a 22% increase from $13.700 billion in 2023[235]. - Net cash used in investing activities increased by $1.9 billion, or 137%, for the three months ended September 30, 2024[229]. - Total debt and financing lease liabilities as of September 30, 2024, were $82.3 billion, with $74.0 billion classified as long-term debt[239]. - The company issued long-term debt for net proceeds of $8.1 billion during the nine months ended September 30, 2024[239]. Shareholder Returns - The 2023-2024 Stockholder Return Program is authorized for up to $19.0 billion, running from October 1, 2023, through December 31, 2024[258]. - During the three months ended September 30, 2024, the company repurchased 3,179,707 shares at an average price of $202.45, totaling $644 million[261]. - The company reported share repurchases totaling $57 million during the three months ended September 30, 2024[277]. - As of September 30, 2024, the company had $1.0 billion for dividends payable presented within other current liabilities[260]. Legal and Compliance - Legal proceedings are ongoing, with details available in Note 13 of the Condensed Consolidated Financial Statements[277]. - The company remains in compliance with all restrictive debt covenants as of September 30, 2024[255].