NASDAQ$TMUS

T-Mobile Us Inc · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

T-Mobile overtook AT&T as America’s #2 wireless provider and delivered industry-leading customer growth with strong financial results.

T-Mobile's Q2 2020 was marked by industry-leading customer growth and the successful merger with Sprint. The company surpassed AT&T to become the #2 wireless provider in America. Total net additions reached 1,245,000, and postpaid net additions were 1,112,000. The company is focused on integrating Sprint and building a transformative 5G network.

  • T-Mobile overtook AT&T as the #2 wireless provider in America.
  • The company led the industry in total branded net customer additions for the 22nd consecutive quarter.
  • T-Mobile is integrating Sprint and building a nationwide 5G network.
  • The company is confident in its ability to unlock massive synergies and achieve cost savings from the Sprint merger.

Headline financials

Total Revenue

$17.7B

Previous: $11B+61.0%
EPS (adj)

$0.09

Previous: $1.09-91.7%
Postpaid Net Customer Adds

1.1M

No prior period
Prepaid Net Customer Adds

133.0K

No prior period
Postpaid Phone Churn

0.8%

No prior period
Prepaid Churn

2.8%

No prior period
Capital Expenditures

$2.26B

Previous: -$1.79B+226.2%
Free Cash Flow

$1.44B

Previous: -$850M+269.5%
Net Income

$110M

Previous: $939M-88.3%
Operating Income

$820M

Previous: $1.54B-46.8%
Gross Profit

$10.9B

Previous: -$144M+7673.6%
Cash & Equivalents

$11.1B

Previous: $1.11B+902.4%
Total Assets

$187B

Previous: $84.8B+120.8%
Stock-Based Comp

$259M

Previous: $130M+99.2%

Revenue & EPS history

T-Mobile · Revenue · Quarterly

$17.7B

Q2 2020+61%vs Q2 2019
Beat estimate in 16 of 16 quarters(100%)
ActualEstimate

Revenue by segment

T-Mobile · $9.96B total across 1 segment · Q2 2020

  • Postpaid Service Revenue
    $9.96B

Forward guidance

T-Mobile provided guidance for the second half of 2020, including expectations for postpaid net customer additions, Adjusted EBITDA, cash purchases of property and equipment, merger and integration-related costs, net cash provided by operating activities, and Free Cash Flow.

Tailwinds

  • Postpaid net customer additions are expected to be between 1.7 million and 1.9 million.
  • Adjusted EBITDA is expected to be in the range of $12.4 billion to $12.7 billion, including leasing revenues of $2.4 billion to $2.6 billion.
  • Net cash provided by operating activities, including payments for merger and integration-related costs, is expected to be in the range of $5.3 billion to $5.7 billion.
  • Free Cash Flow, including payments for merger and integration-related costs, is expected to be in the range of $300 million to $500 million.
  • The company controls an average of 319 MHz of combined low and mid-band spectrum on average nationwide.

Headwinds

  • Cash purchases of property and equipment, including capitalized interest are expected to be between $6.5 billion and $6.9 billion.
  • Merger and integration-related costs are expected to be $800 million to $1 billion before taxes. These costs are excluded from Adjusted EBITDA but will impact Net income and cash flows.
  • Net income decreased year-over-year to $110 million and EPS decreased year-over-year to $0.09 in Q2 2020, primarily due to the Sprint merger and merger-related costs, impacts of COVID-19, and non-cash impairments.
  • COVID-19-related costs were $341 million pre-tax and $253 million, net of tax, in Q2 2020.
  • Free Cash Flow guidance does not assume any material net cash inflows from securitization.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+1.8%

Avg return

Earnings day

+2.8%

Avg return

5 days after

+3.0%

Avg return

30 days after

62%

42 / 68 earnings

Positive

+43.9%

Q2 2012

Best reaction

-11.2%

Q1 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.3%+4.1%+0.3%
Q4 2025+5.1%+10.1%+9.0%
Q3 2025-4.0%-3.3%-7.9%
Q2 2025+1.7%+3.5%-3.4%
Q1 2025-11.2%-5.8%-7.4%
Q3 2024+6.6%+4.0%+8.8%
Q2 2024+6.7%+6.6%+13.3%
Q1 2024-0.1%-0.0%+1.1%
Q4 2023+0.1%-0.2%+1.4%
Q3 2023+1.3%+0.4%+5.6%
Q2 2023-0.2%-2.7%-5.5%
Q1 2023-3.0%-5.3%-8.9%
Q4 2022-1.6%-4.9%-5.0%
Q3 2022+7.2%+8.1%+7.2%
Q2 2022+5.8%+7.4%+6.8%
Q1 2022+5.9%+1.2%+7.3%
Q4 2021+10.3%+11.4%+12.5%
Q3 2021+5.2%+5.9%-4.7%
Q2 2021-0.8%-0.4%-4.6%
Q1 2021+2.0%+5.8%+8.3%
Q4 2020-3.2%-3.8%-3.6%
Q3 2020+6.5%+4.9%+13.6%
Q2 2020+6.7%+5.3%+5.9%
Q1 2020+7.1%+8.7%+13.7%
Q4 2019+4.5%+15.5%+7.4%
Q3 2019+0.2%+1.0%-3.2%
Q2 2019+4.5%+0.9%-5.1%
Q1 2019-0.6%-0.5%+5.4%
Q4 2018+2.2%+4.0%+5.5%
Q3 2018+5.6%+5.5%+5.8%
Q2 2018+3.6%+10.5%+10.1%
Q1 2018-5.9%-5.4%-7.9%
Q4 2017-4.6%-7.0%+5.1%
Q3 2017+3.0%+4.1%+1.5%
Q2 2017-0.4%+1.9%+2.6%
Q1 2017+4.1%+4.0%+4.9%
Q4 2016+0.7%+5.0%+2.4%
Q3 2016+6.1%+5.6%+16.2%
Q2 2016+2.8%+4.6%+2.2%
Q1 2016-3.6%
Q4 2015+0.5%
Q3 2015-5.0%
Q2 2015+9.8%
Q1 2015+1.6%
Q4 2014+3.1%
Q3 2014+2.6%
Q2 2014+8.0%
Q1 2014+9.3%
Q4 2013-6.1%
Q3 2013-1.1%
Q2 2013+5.1%
Q1 2013+1.4%
Q4 2012+3.5%
Q3 2012-3.6%
Q2 2012+43.9%
Q1 2012+1.0%
Q4 2011-1.4%
Q3 2011+0.8%
Q2 2011-9.3%
Q4 2010-9.3%
Q1 2010-0.8%
Q1 2011+1.0%
Q4 2008-1.4%
Q3 2010+7.4%
Q3 2009+7.4%
Q4 2009-7.1%
Q2 2010-7.1%
Q2 2009-7.1%

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