T-Mobile(US:TMUS)2023-05-17 15:23T-Mobile US, Inc. Conference Call Summary Company Overview - Company: T-Mobile US, Inc. (NASDAQ: TMUS) - Event: SVB MoffettNathanson's Inaugural Technology, Media and Telecom Conference - Date: May 17, 2023 - Participants: - Peter Osvaldik - Chief Financial Officer - Craig Moffett - MoffettNathanson Key Industry Insights Mobile Market Growth - The mobile market has grown faster than the population growth rate over the last five years due to several factors: - Increased importance of core connectivity during the pandemic - Demographic expansion across age brackets - New business formations and stimulus money contributing to growth - Shift from prepaid to post-paid plans, particularly benefiting cable growth [3][5][9] Market Deceleration - T-Mobile anticipates a deceleration in subscriber growth, projecting an industry-wide addition of 7 to 8 million post-paid phones, down from 9.3 million the previous year [8][9] - The focus on post-paid phone growth is critical, but T-Mobile is also exploring other connectivity opportunities, especially with the advent of 5G [9][10] Competitive Landscape - The competitive environment is intensifying, particularly with aggressive promotions from Verizon and AT&T. T-Mobile aims to differentiate itself through value and network quality rather than engaging in price wars [11][12][64][65] Strategic Focus Areas Network Leadership - T-Mobile claims to have achieved the best network quality, particularly in 5G, which is expected to translate into overall market leadership [13][14] - The company is targeting underpenetrated segments, including smaller markets and rural areas, with a goal of reaching 20% market share by the end of 2025 [21][26] Business and Government Segments - T-Mobile is focusing on increasing its penetration in the enterprise and government sectors, aiming for a 20% market share by 2025. The company has seen success in these areas due to its network capabilities and customer service [26][30] Fixed Wireless and 5G Opportunities - T-Mobile's fixed wireless business has reached 3.2 million subscribers, generating ARPUs near post-paid phone levels. This segment is seen as a way to monetize excess network capacity [41][69] - The company is exploring private networks and IoT applications, although these opportunities are still developing [35][36][37] Financial Performance and Guidance Cash Flow and Share Buybacks - T-Mobile is generating significant cash flow, allowing for accelerated share buybacks, with a target of up to $60 billion through 2025 [72][74] - The company is open to strategic investments, particularly in spectrum, but has not identified any significant opportunities at this time [73][77] Customer Lifetime Value (CLV) - T-Mobile is shifting focus from ARPU to ARPA (Average Revenue Per Account) expansion, emphasizing the importance of customer lifetime value in its growth strategy [58][59] Conclusion - T-Mobile is well-positioned in the mobile market with a strong focus on network quality, customer value, and strategic growth in underpenetrated segments. The company is navigating a competitive landscape while maintaining a commitment to financial performance and shareholder returns.