T-Mobile US Inc
For the period ended Jun 30, 2024. Filed Jul 31, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 31, 2024
TMUS$162.01+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-26.
0001283699-24-000065
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsPerformance MeasuresCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-31.
0001283699-24-000111
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsPerformance MeasuresThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 251 previous paragraphs and 319 current paragraphs.
141 unchanged; 73 reworded; 83 added; 35 removed; 2 previous and 22 current paragraphs rearranged.
Tables are not compared: 18 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (83)
Current report
Merger-related costs associated with the Sprint Merger generally include:
Current report
NM- Not meaningful
Current report
On April 24, 2024, we entered into a merger agreement with a fund operated by EQT, Infrastructure VI fund (“Fund VI”), for the joint acquisition by us and Fund VI of Lumos, a fiber-to-the-home platform (“Lumos”), from EQT’s predecessor fund, EQT Infrastructure III. The Lumos joint acquisition is expected to close in late 2024 or early 2025, subject to customary closing conditions and regulatory approvals. At closing, we expect to invest approximately $950 million in the joint venture to acquire a 50% equity interest and all existing Lumos fiber customers. The funds invested by us will be used to fund future fiber builds. In addition, pursuant to the merger agreement, we expect to make an additional capital contribution of approximately $500 million in 2027 or 2028. The joint venture will focus on market identification and selection, network engineering and design, network deployment, and customer installation, with us owning customer relationships and selling fiber service under the T-Mobile brand. Upon closing of the transaction, we expect to account for the Lumos joint venture under the equity method of accounting and recognize service revenues for the acquired Lumos fiber customers and wholesale costs paid to the joint venture for network access reflected in Cost of services on our Condensed Consolidated Statements of Comprehensive Income.
Current report
On May 1, 2024 (the “Acquisition Date”), we completed the merger with Ka’ena Corporation and its subsidiaries, including, among others, Mint Mobile LLC (collectively, “Ka’ena”), and as a result, Ka’ena became a wholly owned subsidiary of T-Mobile (the “Ka’ena Acquisition”). The total purchase price is variable, dependent upon specified performance indicators of Ka’ena, and consists of an upfront payment on the Acquisition Date and an earnout payable on August 1, 2026. On the Acquisition Date and in satisfaction of the upfront payment, we transferred $420 million in cash and 3,264,952 shares of T-Mobile common stock valued at $536 million as determined based on its closing market price on April 30, 2024, for a total payment fair value of $956 million. A portion of the upfront payments made on the Acquisition Date was for the settlement of the preexisting wholesale relationship with Ka’ena.
Current report
Based on the amount paid upfront, up to an additional $403 million in future cash and T-Mobile common stock is payable in satisfaction of the earnout, dependent upon Ka’ena’s achievement of specified performance indicators.
Current report
Prior to the Ka’ena Acquisition, Ka’ena was a wholesale partner of the Company for which we recognized service revenues within Wholesale and other service revenues. Upon the closing of the Ka’ena Acquisition, this relationship was effectively terminated, and the Company acquired Ka’ena’s prepaid customer relationships and will recognize service revenues associated with these customers within Prepaid revenues and operating expenses primarily within Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income subsequent to the Acquisition Date.
Current report
For more information regarding the Ka’ena Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.
Current report
On May 24, 2024, we entered into a securities purchase agreement with United States Cellular Corporation (“UScellular”), Telephone and Data Systems, Inc., and USCC Wireless Holdings, LLC, pursuant to which, among other things, we will acquire substantially all of UScellular’s wireless operations and select spectrum assets for an aggregate purchase price of approximately $4.4 billion, payable in cash and the assumption of up to $2.0 billion of debt through an exchange offer to be made to certain UScellular debtholders prior to closing. To the extent any debtholders do not participate in the exchange, their bonds will continue as obligations of UScellular, and the cash portion of the purchase price will be correspondingly increased. The transaction is expected to close in mid-2025, subject to customary closing conditions and receipt of certain regulatory approvals. Upon closing of the transaction, we expect to account for the UScellular transaction as a business combination and to consolidate the acquired operations. We expect this transaction will yield approximately $1.0 billion in total annual run rate cost synergies, including operating expense and capital expenditure synergies, upon integration, with total cost to achieve the integration currently estimated at between $2.2 billion to $2.6 billion.
Current report
For more information regarding our acquisition of UScellular Wireless Assets, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.
Current report
Subsequent to June 30, 2024, on July 18, 2024, we entered into a definitive agreement with KKR & Co. Inc. (“KKR”) to establish a joint venture to acquire Metronet Holdings, LLC and certain of its affiliates (collectively, “Metronet”), a fiber-to-the-home platform. This arrangement is expected to close in 2025, subject to customary closing conditions and regulatory approvals. At closing, we expect to invest approximately $4.9 billion in the joint venture to acquire a 50% equity interest and all existing residential fiber customers, as well as funding the joint venture. We do not anticipate making further capital contributions following the closing. The joint venture will focus on build plans, network engineering and design, network deployment, and customer installation, with us owning customer relationships and selling fiber service under the T-Mobile brand. Upon the closing of the transaction, we expect to account for the Metronet joint venture under the equity method of accounting and recognize service revenues for the acquired Metronet fiber customers and wholesale costs paid to the joint venture for network access reflected in Cost of services on our Condensed Consolidated Statements of Comprehensive Income.
Current report
Total revenues increased $576 million, or 3%, for the three months ended and increased $538 million, or 1%, for the six months ended June 30, 2024. The components of these changes are discussed below.
Current report
Postpaid revenues increased $829 million, or 7%, for the three months ended and increased $1.6 billion, or 7%, for the six months ended June 30, 2024, primarily from:
Current report
Prepaid revenues increased $148 million, or 6%, for the three months ended and increased $134 million, or 3%, for the six months ended June 30, 2024, primarily from:
Current report
•Higher average prepaid customers, primarily from the prepaid customers acquired through the Ka’ena Acquisition; partially offset by
Current report
Equipment revenues decreased $63 million, or 2%, for the three months ended and decreased $531 million, or 8%, for the six months ended June 30, 2024.
Current report
•A net decrease in the total number of devices sold, driven by lower Assurance Wireless, prepaid and postpaid upgrade units, partially offset by higher postpaid gross addition related devices; partially offset by
Current report
•A net decrease in the total number of devices sold, driven by lower Assurance Wireless, prepaid and postpaid upgrade units, partially offset by higher postpaid gross addition related devices; partially offset by
Current report
•Higher Merger synergies.
Current report
•Higher Merger synergies.
Current report
Offsetting impacts for the three months ended June 30, 2024, primarily included:
Current report
•An increase of $99 million in liquidation costs, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing; offset by
Current report
•A net decrease in the total number of devices sold, driven by lower Assurance Wireless, prepaid and postpaid upgrade units, partially offset by higher postpaid gross addition related devices; partially offset by
Current report
•A net decrease in the total number of devices sold, driven by lower Assurance Wireless, prepaid and postpaid upgrade units, partially offset by higher postpaid gross addition related devices; partially offset by
Current report
Selling, general and administrative expenses decreased $130 million, or 2%, for the three months ended and decreased $417 million, or 4%, for the six months ended June 30, 2024.
Current report
•A decrease of $180 million in Merger-related costs, including the $100 million gain recognized in the current period for the extension fee previously paid by DISH associated with the DISH License Purchase Agreement; and
Current report
•Higher Merger synergies; partially offset by
Current report
•Higher costs as a result of the Ka’ena Acquisition.
Current report
•A decrease of $316 million in Merger-related costs, including the $100 million gain recognized in the current period for the extension fee previously paid by DISH associated with the DISH License Purchase Agreement;
Current report
•Higher Merger synergies; partially offset by
Current report
•Higher legal expenses, including the settlement associated with the FCC Notices of Apparent Liability (See Note 13 – Commitments and Contingencies of the Notes to the Condensed Consolidated Financial Statements); and
Current report
•Higher costs as a result of the Ka’ena Acquisition.
Current report
Interest expense, net was relatively flat.
Current report
Income tax expense increased $126 million, or 18%, for the three months ended and increased $259 million, or 19%, for the six months ended June 30, 2024, primarily from:
Current report
•An increase in tax benefits from adjustments to certain tax reserves.
Current report
Postpaid net account additions increased slightly for the three months ended and decreased 67,000, or 11%, for the six months ended June 30, 2024.
Current report
The slight increase for the three months ended June 30, 2024, was primarily from:
Current report
•Higher deactivations and fewer High Speed Internet only additions due to the sunsetting of promotional pricing, as well as a higher mix of High Speed Internet customers from existing accounts.
Current report
•Higher deactivations and fewer High Speed Internet only additions due to the sunsetting of promotional pricing, as well as a higher mix of High Speed Internet customers from existing accounts; partially offset by
Showing the first 40 of 83 passages. Open the source sections for the rest.
Removed paragraphs (35)
Previous report
Merger-related costs associated with the Merger and acquisitions of affiliates generally include:
Previous report
On March 9, 2023, we entered into a Merger and Unit Purchase Agreement (the “Merger and Unit Purchase Agreement”) for the acquisition of 100% of the outstanding equity of Ka’ena Corporation and its subsidiaries, including, among others, Mint Mobile LLC (collectively, “Ka’ena”), for a maximum purchase price of $1.35 billion to be paid out 39% in cash and 61% in shares of T-Mobile common stock (the “Ka’ena Acquisition”). On March 13, 2024, we entered into Amendment No. 1 to the Merger and Unit Purchase Agreement, which amended, among other things, certain mechanics of the payment of the purchase consideration for the Ka’ena Acquisition, which will result in a nominal increase in the percentage of cash compared to shares of T-Mobile common stock to be paid out as part of the total purchase price.
Previous report
The purchase price is variable, dependent upon specified performance indicators of Ka’ena during certain periods before and after closing, and consists of an upfront payment at closing of the transaction, subject to certain agreed-upon working capital and other adjustments, and a variable earnout payable 24 months after closing of the transaction. Our estimate of the upfront payment is subject to Ka’ena’s underlying business performance and the timing of transaction close, and is currently estimated to be $1.2 billion, before working capital and other adjustments, which we currently estimate will result in a net upfront payment of approximately $950 million, with approximately 45% to be paid in cash. Subsequent to March 31, 2024, on April 25, 2024, we received all necessary regulatory approvals and the Ka’ena Acquisition is expected to close on May 1, 2024.
Previous report
Ka’ena is currently one of our wholesale partners, offering wireless telecommunications services to customers leveraging our network. Upon closing of the Ka’ena Acquisition, we expect to recognize customers of Ka’ena as prepaid customers, and we expect to see an increase in Prepaid revenues, partially offset by a decrease in Wholesale and other service revenues.
Previous report
Total revenueswas relatively flat. The offsetting changes impacting Total revenues are discussed below.
Previous report
Postpaid revenues increased $769 million, or 6%, primarily from:
Previous report
Prepaid revenues decreased slightly, primarily from:
Previous report
•Higher average prepaid customers.
Previous report
Equipment revenues decreased $468 million, or 13%, primarily from:
Previous report
•A decrease in the number of postpaid and prepaid devices sold, including lower upgrades; partially offset by
Previous report
•Lower employee costs, primarily due to reduced headcount; and
Previous report
•A decrease in the number of postpaid and prepaid devices sold, including lower upgrades; partially offset by
Previous report
Selling, general and administrative expenses decreased $287 million, or 5%, primarily from:
Previous report
•A decrease of $136 million in Merger-related costs, as well as higher Merger synergies;
Previous report
•Lower employee costs, primarily due to reduced headcount; and
Previous report
•Lower severance and restructuring expenses; partially offset by
Previous report
•Higher legal expenses.
Previous report
Interest expense, net increased $45 million, or 5%, primarily from:
Previous report
•Higher interest expense, primarily due to higher average debt outstanding and a slightly higher average effective interest rate; partially offset by
Previous report
•Higher interest income, primarily due to higher average balances and higher average interest rates on short-term cash equivalents.
Previous report
Postpaid net account additions decreased 69,000, or 24%, primarily from fewer High Speed Internet only net account additions.
Previous report
Total net customer additions decreased 147,000, or 11%, primarily from:
Previous report
Postpaid ARPA increased $2.84, or 2%, primarily from:
Previous report
Postpaid phone ARPU was relatively flat, primarily from:
Previous report
Prepaid ARPU decreased $0.80, or 2%, primarily from dilution from rate plan mix.
Previous report
Net cash provided by operating activities increased $1.0 billion, or 25%, primarily from:
Previous report
Net cash used in investing activities increased $59 million, or 3%. The use of cash was primarily from:
Previous report
Net cash used in financing activities decreased $607 million, or 27%. The use of cash was primarily from:
Previous report
•$223 million in Repayments of long-term debt; and
Previous report
Adjusted Free Cash Flow increased $946 million, or 39%, primarily from:
Previous report
On March 9, 2023, we entered into a Merger and Unit Purchase Agreement for the Ka’ena Acquisition. On March 13, 2024, we entered into Amendment No. 1 to the Merger and Unit Purchase Agreement, which amended, among other things, certain mechanics of the payment of the purchase consideration for the Ka’ena Acquisition which will result in a nominal increase in the percentage of cash compared to shares of T-Mobile common stock to be paid out as part of the total purchase price. The purchase price is variable, dependent upon specified performance indicators of Ka’ena during certain periods before and after closing, and consists of an upfront payment at closing of the transaction, subject to certain agreed-upon working capital and other adjustments, and a variable earnout payable 24 months after closing of the transaction. Our estimate of the upfront payment is subject to Ka’ena’s underlying business performance and the timing of transaction close, and is currently estimated to be $1.2 billion, before working capital and other adjustments, which we currently estimate will result in a net upfront payment of approximately $950 million, with approximately 45% to be paid in cash. Subsequent to March 31, 2024, on April 25, 2024, we received all necessary regulatory approvals and the Ka’ena Acquisition is expected to close on May 1, 2024.
Reworded paragraphs (73)
Previous wording
•the impacts of the actions we have taken and conditions we have agreed to in connection with the regulatory proceedings and approvals of our merger (the “Merger”) with Sprint Corporation (“Sprint”) pursuant to a Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”), including the acquisition by DISH Network Corporation (“DISH”) of the prepaid wireless business operated under the Boost Mobile and Sprint prepaid brands (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Personal Communications Company LLC (“Shentel”) and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets, and the assumption of certain related liabilities (collectively, the “Prepaid Transaction”), the complaint and proposed final judgment (the “Final Judgment”) agreed to by us, Deutsche Telekom AG (“DT”), Sprint, SoftBank Group Corp. (“SoftBank”) and DISH with the U.S. District Court for the District of Columbia, which was approved by the Court on April 1, 2020, as amended on October 23, 2023, the proposed commitments filed with the Secretary of the Federal Communications Commission (“FCC”), which we announced on May 20, 2019, certain national security commitments and undertakings, and any other commitments or undertakings entered into, including, but not limited to, those we have made to certain states and nongovernmental organizations (collectively, the “Government Commitments”), and the challenges in satisfying the Government Commitments in the required time frames and the significant cumulative costs incurred in tracking and monitoring compliance over multiple years;
Current wording
•the impacts of the actions we have taken and conditions we have agreed to in connection with the regulatory proceedings and approvals of our merger (the “Merger”) with Sprint Corporation (“Sprint”) pursuant to a Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”), including the acquisition by DISH Network Corporation (“DISH”) of the prepaid wireless business operated under the Boost Mobile and Sprint prepaid brands (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Personal Communications Company LLC and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets, and the assumption of certain related liabilities (collectively, the “Prepaid Transaction”), the complaint and proposed final judgment (the “Final Judgment”) agreed to by us, Deutsche Telekom AG (“DT”), Sprint, SoftBank Group Corp. (“SoftBank”) and DISH with the U.S. District Court for the District of Columbia, which was approved by the Court on April 1, 2020, as amended on October 23, 2023, the proposed commitments filed with the Secretary of the Federal Communications Commission (“FCC”), which we announced on May 20, 2019, certain national security commitments and undertakings, and any other commitments or undertakings entered into, including, but not limited to, those we have made to certain states and nongovernmental organizations (collectively, the “Government Commitments”), and the challenges in satisfying the Government Commitments in the required time frames and the significant cumulative costs incurred in tracking and monitoring compliance over multiple years;
Previous wording
•the timing and effects of any future acquisition, divestiture, investment, or merger involving us;
Current wording
•the timing and effects of any future acquisition, divestiture, investment, or merger involving us, including our inability to obtain any required regulatory approval necessary to consummate any such transactions;
Previous wording
•our exclusive forum provision as provided in our Fifth Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”);
Current wording
•our exclusive forum provision as provided in our Fifth Amended and Restated Certificate of Incorporation;
Previous wording
Investors and others should note that we announce material information to our investors using our investor relations website (https://investor.t-mobile.com), newsroom website (https://t-mobile.com/news), press releases, SEC filings and public conference calls and webcasts. We intend to also use certain social media accounts as means of disclosing information about us and our services and for complying with our disclosure obligations under Regulation FD (the @TMobileIR X account (https://twitter.com/TMobileIR), the @MikeSievert X account (https://twitter.com/MikeSievert), which Mr. Sievert also uses as a means for personal communications and observations, and the @TMobileCFO X account (https://twitter.com/tmobilecfo) and our Chief Financial Officer’s LinkedIn account (https://www.linkedin.com/in/peter-osvaldik-3887394), both of which Mr. Osvaldik also uses as a means for personal communication and observations). The information we post through these social media channels may be deemed material. Accordingly, investors should monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described above may be updated from time to time as listed on our investor relations website.
Current wording
Investors and others should note that we announce material information to our investors using our investor relations website (https://investor.t-mobile.com), newsroom website (https://t-mobile.com/news), press releases, SEC filings and public conference calls and webcasts. We intend to also use certain social media accounts as means of disclosing information about us and our services and for complying with our disclosure obligations under Regulation FD (the @TMobileIR X account (https://x.com/TMobileIR), the @MikeSievert X account (https://x.com/MikeSievert), which Mr. Sievert also uses as a means for personal communications and observations, and the @TMobileCFO X account (https://x.com/tmobilecfo) and our Chief Financial Officer’s LinkedIn account (https://www.linkedin.com/in/peter-osvaldik-3887394), both of which Mr. Osvaldik also uses as a means for personal communication and observations). The information we post through these social media channels may be deemed material. Accordingly, investors should monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described above may be updated from time to time as listed on our investor relations website.
Previous wording
Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2024, included in Part I, Item 1 of this Form 10-Q, and audited consolidated financial statements, included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023. Except as expressly stated, the financial condition and results of operations discussed throughout our MD&A are those of T-Mobile US, Inc. and its consolidated subsidiaries.
Current wording
Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements as of and for the three and six months ended June 30, 2024, included in Part I, Item 1 of this Form 10-Q, and audited consolidated financial statements, included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023. Except as expressly stated, the financial condition and results of operations discussed throughout our MD&A are those of T-Mobile US, Inc. and its consolidated subsidiaries.
Previous wording
In the second quarter of 2024, we will recognize a gain for the $100 million extension fee previously paid by DISH associated with the DISH License Purchase Agreement as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income. The gain will be presented as a reduction in Merger-related costs and excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA. See Note 5 – Spectrum License Transactions of the Notes to the Condensed Consolidated Financial Statements for more information.
Current wording
During the three months ended June 30, 2024, we recognized a gain for the $100 million extension fee previously paid by DISH associated with the DISH License Purchase Agreement as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income. The gain was presented as a reduction in Merger-related costs and excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA. See Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements for more information.
Previous wording
We expect to incur all of the remaining restructuring and integration costs associated with the Merger by the first half of 2024, with the cash expenditure for the Merger-related costs extending beyond 2024. Cash payments extending beyond 2024 primarily relate to operating and financing leases for which we have recognized accelerated lease expense.
Current wording
As of June 30, 2024, we have incurred all restructuring and integration costs associated with the Sprint Merger, with the cash payments for the Merger-related costs extending beyond 2024. Cash payments extending beyond 2024 primarily relate to operating and financing leases for which we have recognized accelerated lease expense.
Previous wording
The following discussion and analysis is for the three months ended March 31, 2024, compared to the same period in 2023, unless otherwise stated.
Current wording
The following discussion and analysis is for the three and six months ended June 30, 2024, compared to the same period in 2023, unless otherwise stated.
Previous wording
•Lower prepaid ARPU. See “Prepaid ARPU” in the “Performance Measures” section of this MD&A; mostly offset by
Current wording
•Lower prepaid ARPU. See “Prepaid ARPU” in the “Performance Measures” section of this MD&A.
Previous wording
Wholesale and other service revenues decreased $205 million, or 16%, primarily from:
Current wording
Wholesale and other service revenues decreased $286 million, or 23%, for the three months ended and decreased $491 million, or 20%, for the six months ended June 30, 2024.
Previous wording
•Lower Affordable Connectivity Program and Lifeline revenues; and
Current wording
•Lower Affordable Connectivity Program and Lifeline revenues.
Previous wording
•Lower MVNO revenues, primarily due to DISH servicing more of its Boost customers with their standalone network and the migration of legacy TracFone customers off of the T-Mobile network, partially offset by growth in other MVNO partners.
Current wording
•Lower MVNO revenues, primarily due to DISH servicing more of its Boost customers with their standalone network and the migration of legacy TracFone customers off of the T-Mobile network, partially offset by growth in other MVNO partners; and
Previous wording
•A decrease of $503 million in device sales revenue, excluding purchased leased devices, primarily from:
Current wording
•A decrease of $140 million in device sales revenue, excluding purchased leased devices, primarily from:
Previous wording
•Slightly higher average revenue per device sold, primarily driven by a shift in the high-end phone mix, mostly offset by an increase in promotions per postpaid device; and
Current wording
•Slightly higher average revenue per device sold, net of promotions, primarily driven by an increase in the high-end phone mix; partially offset by
Previous wording
•An increase of $227 million in liquidation revenue, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.
Current wording
•An increase of $121 million in liquidation revenue, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.
Previous wording
•A decrease of $112 million in lease revenues, primarily due to a lower number of customer devices under lease as a result of the continued strategic shift in device financing from leasing to EIP; partially offset by
Current wording
•A decrease of $155 million in lease revenues, primarily due to a lower number of customer devices under lease as a result of the continued strategic shift in device financing from leasing to EIP; partially offset by
Previous wording
Other revenues decreased $120 million, or 33%, primarily from the transition of certain device recovery programs from external sources to in-house processing, resulting in a change in presentation from Other revenues to Equipment revenues.
Current wording
Other revenues decreased $52 million, or 18%, for the three months ended and decreased $172 million, or 26%, for the six months ended June 30, 2024, primarily from the transition of certain device recovery programs from external sources to in-house processing, resulting in a change in presentation from Other revenues to Equipment revenues.
Previous wording
Total operating expenses decreased $639 million, or 4%. The components of this change are discussed below.
Current wording
Total operating expenses decreased $261 million, or 2%, for the three months ended and decreased $900 million, or 3%, for the six months ended June 30, 2024. The components of this change are discussed below.
Previous wording
Cost of services, exclusive of depreciation and amortization, decreased $373 million, or 12%, primarily from:
Current wording
Cost of services, exclusive of depreciation and amortization, decreased $252 million, or 9%, for the three months ended and decreased $625 million, or 10%, for the six months ended June 30, 2024.
Previous wording
•A decrease of $101 million in Merger-related costs related to network decommissioning and integration, as well as higher Merger synergies.
Current wording
•A decrease of $105 million in Merger-related costs related to network decommissioning and integration;
Previous wording
Cost of equipment sales, exclusive of depreciation and amortization, decreased $189 million, or 4%, primarily from:
Current wording
Cost of equipment sales, exclusive of depreciation and amortization, was flat for the three months ended and decreased $189 million, or 2%, for the six months ended June 30, 2024.
Previous wording
•A decrease of $291 million in device cost of equipment sales, excluding purchased leased devices, primarily from:
Current wording
•A decrease of $65 million in device cost of equipment sales, excluding purchased leased devices, primarily from:
Previous wording
•An increase of $156 million in liquidation costs, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.
Current wording
•An increase of $255 million in liquidation costs, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.
Previous wording
Gain on disposal group held for sale was $42 million for the three months ended March 31, 2023, related to the sale of the Wireline Business on May 1, 2023. There was no gain or loss on disposal group held for sale for the three months ended March 31, 2024.
Current wording
Loss (gain) on disposal group held for sale was a loss of $17 million for the three months ended June 30, 2023, and a gain of $25 million for the six months ended June 30, 2023, related to the sale of the Wireline Business on May 1, 2023. There was no gain or loss on disposal group held for sale for the three and six months ended June 30, 2024.
Previous wording
Depreciation and amortization increased $168 million, or 5%, primarily from higher depreciation expense from the acceleration of certain technology assets as we continue to modernize our network, technology systems and platforms.
Current wording
Depreciation and amortization increased $138 million, or 4%, for the three months ended and increased $306 million, or 5%, for the six months ended June 30, 2024, primarily from higher depreciation expense from the acceleration of certain technology assets as we continue to modernize our network, technology systems and platforms.
Previous wording
Operating income, the components of which are discussed above, increased $601 million, or 18%.
Current wording
Operating income, the components of which are discussed above, increased $837 million, or 22%, for the three months ended and increased $1.4 billion, or 20%, for the six months ended June 30, 2024.
Previous wording
Other income, net was insignificant for both periods.
Current wording
Other (expense) income, net was insignificant for both periods.
Previous wording
Income before income taxes, the components of which are discussed above, was $3.1 billion and $2.6 billion for the three months ended March 31, 2024 and 2023, respectively.
Current wording
Income before income taxes, the components of which are discussed above, was $3.8 billion and $2.9 billion for the three months ended June 30, 2024 and 2023, respectively, and $6.9 billion and $5.5 billion for the six months ended June 30, 2024 and 2023, respectively.
Previous wording
Income tax expense increased $133 million, or 21%, primarily from higher income before income taxes.
Current wording
•Higher income before income taxes; partially offset by
Previous wording
Our effective tax rate was 24.4% and 24.5% for the three months ended March 31, 2024 and 2023, respectively.
Current wording
Our effective tax rate was 22.4% and 24.4% for the three months ended June 30, 2024 and 2023, respectively, and 23.3% and 24.5% for the six months ended June 30, 2024 and 2023, respectively.
Previous wording
Net income, the components of which are discussed above, was $2.4 billion and $1.9 billion for the three months ended March 31, 2024 and 2023, respectively.
Current wording
Net income, the components of which are discussed above, was $2.9 billion and $2.2 billion for the three months ended June 30, 2024 and 2023, respectively, and $5.3 billion and $4.2 billion for the six months ended June 30, 2024 and 2023, respectively.
Previous wording
Net income included Merger-related costs, net of tax, of $97 million for the three months ended March 31, 2024, compared to $268 million for the three months ended March 31, 2023.
Current wording
Net income included a Merger-related gain, net of Merger-related costs and tax, of $6 million for the three months ended June 30, 2024, and Merger-related costs, net of Merger-related gain and tax, of $91 million for the six months ended June 30, 2024, compared to Merger-related costs, net of tax, of $207 million and $475 million for the three and six months ended June 30, 2023, respectively.
Previous wording
High Speed Internet customers included in Postpaid other customers were 4,634,000 and 2,855,000 as of March 31, 2024 and 2023, respectively. High Speed Internet customers included in Prepaid customers were 547,000 and 314,000 as of March 31, 2024 and 2023, respectively.
Current wording
High Speed Internet customers included in Postpaid other customers were 4,992,000 and 3,302,000 as of June 30, 2024 and 2023, respectively. High Speed Internet customers included in Prepaid customers were 595,000 and 376,000 as of June 30, 2024 and 2023, respectively.
Previous wording
The following table sets forth the number of net customer additions (losses):
Current wording
The following table sets forth the number of net customer additions:
Previous wording
•Lower net additions from High Speed Internet, primarily driven by increased deactivations from a growing customer base and lower gross additions driven by sunsetting of promotional pricing in order to maximize long-term value creation, partially offset by a lower churn rate;
Current wording
•Lower net additions from High Speed Internet, primarily driven by increased deactivations from a growing customer base, partially offset by a lower churn rate; and
Previous wording
•High Speed Internet net customer additions included in postpaid other net customer additions were 346,000 and 445,000 for the three months ended March 31, 2024 and 2023, respectively. High Speed Internet net customer additions included in prepaid net customer (losses) additions were 59,000 and 78,000 for the three months ended March 31, 2024 and 2023, respectively.
Current wording
•High Speed Internet net customer additions included in postpaid other net customer additions were 358,000 and 447,000 for the three months ended June 30, 2024 and 2023, respectively. High Speed Internet net customer additions included in prepaid net customer additions were 48,000 and 62,000 for the three months ended June 30, 2024 and 2023, respectively.
Previous wording
•Prepaid net customer losses, primarily due to lower gross additions driven by continued moderation of prepaid industry growth and lower net additions from High Speed Internet;
Current wording
•Lower prepaid net customer additions, primarily driven by continued moderation of prepaid industry growth and lower net additions from High Speed Internet, partially offset by higher gross additions following the Ka’ena Acquisition and lower churn; partially offset by
Previous wording
•Slightly lower postpaid phone net customer additions, primarily due to increased deactivations from a growing customer base, mostly offset by lower churn and higher gross additions.
Current wording
•Slightly higher postpaid phone net customer additions, primarily due to higher gross additions, mostly offset by increased deactivations from a growing base.
Previous wording
Postpaid phone churn decreased 3 basis points, primarily from improved customer retention driven by value and network leadership.
Current wording
•Improved customer retention driven by value and network leadership; offset by
Previous wording
•Higher premium services, primarily high-end rate plans, net of contra-revenue for content included in such plans, and discounts for specific affinity groups, such as 55+, Military and First Responder; and
Current wording
•Higher premium services, primarily high-end rate plans, net of contra-revenue for content included in such plans, and discounts for specific affinity groups, such as 55+, Military and First Responder, partially offset by lower average device protection revenue; and
Showing the first 40 of 73 pairs. Open the source sections for the rest.
Rearranged current paragraphs (22)
Current report — wording carried from elsewhere
•Lower MVNO revenues, primarily due to DISH servicing more of its Boost customers with their standalone network, the impact from the Ka’ena Acquisition and the migration of legacy TracFone customers off of the T-Mobile network, partially offset by growth in other MVNO partners; and
Current report — wording carried from elsewhere
•Lower Affordable Connectivity Program and Lifeline revenues.
Current report — wording carried from elsewhere
•A decrease of $643 million in device sales revenue, excluding purchased leased devices, primarily from:
Current report — wording carried from elsewhere
•Slightly higher average revenue per device sold, net of promotions, primarily driven by an increase in the high-end phone mix; partially offset by
Current report — wording carried from elsewhere
•An increase of $348 million in liquidation revenue, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.
Current report — wording carried from elsewhere
•A decrease of $206 million in Merger-related costs related to network decommissioning and integration;
Current report — wording carried from elsewhere
•Higher average cost per device sold, primarily driven by a shift in the high-end phone mix.
Current report — wording carried from elsewhere
•A decrease of $356 million in device cost of equipment sales, excluding purchased leased devices, primarily from:
Current report — wording carried from elsewhere
•Higher net additions from other connected devices; partially offset by
Current report — wording carried from elsewhere
•Lower postpaid other net customer additions, primarily due to
Current report — wording carried from elsewhere
•Lower net additions from High Speed Internet, primarily driven by increased deactivations from a growing customer base, partially offset by a lower churn rate; and
Current report — wording carried from elsewhere
•Lower net additions from wearables; partially offset by
Current report — wording carried from elsewhere
•High Speed Internet net customer additions included in postpaid other net customer additions were 704,000 and 892,000 for the six months ended June 30, 2024 and 2023, respectively. High Speed Internet net customer additions included in prepaid net customer additions were 107,000 and 140,000 for the six months ended June 30, 2024 and 2023, respectively.
Current report — wording carried from elsewhere
•Lower Cost of services, excluding Special Items.
Current report — wording carried from elsewhere
•A $212 million decrease in net cash outflows from changes in working capital, primarily due to lower use of cash from Accounts payable and accrued liabilities, Accounts receivable and Other current and long-term liabilities, partially offset by higher use of cash from Other current and long-term assets and Inventory.
Current report — wording carried from elsewhere
•A $1.7 billion increase in Net income, adjusted for non-cash income and expense; and
Current report — wording carried from elsewhere
•$4.7 billion in Purchases of property and equipment, including capitalized interest, from the continued build-out of our nationwide 5G network;
Current report — wording carried from elsewhere
•$1.8 billion in Proceeds related to beneficial interests in securitization transactions.
Current report — wording carried from elsewhere
•$351 million in Repayments of financing lease obligations; partially offset by
Current report — wording carried from elsewhere
•$6.0 billion in Repurchases of common stock;
Current report — wording carried from elsewhere
•$1.5 billion in Dividends on common stock;
Current report — wording carried from elsewhere
•$5.6 billion in Proceeds from issuance of long-term debt.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Subsequent to March 31, 2024, from April 1, 2024, through April 19, 2024, we repurchased 5,427,946 shares of our common stock at an average price per share of $160.97 for a total purchase price of $874 million. As of April 19, 2024, we had up to $10.8 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024.
Previous report — wording carried elsewhere
Separately, SoftBank, through one of its non-U.S. subsidiaries, provides roaming services in Iran through Irancell Telecommunications Services Company. During the three months ended March 31, 2024, SoftBank had no gross revenues from such services and no net profit was generated. We understand that the SoftBank subsidiary intends to continue such services.