T-Mobile Q1 2022 Earnings Report
Key Takeaways
T-Mobile reported strong Q1 2022 results, demonstrating industry-leading growth in postpaid and broadband customers, driven by its 5G network. The company raised its full-year 2022 guidance across the board, reflecting its strong financial performance and accelerated integration progress.
Postpaid net account additions of 348 thousand, best in industry and record Q1.
Postpaid net customer additions of 1.3 million, best in industry and highest Q1 in eight years.
High Speed Internet net customer additions of 338 thousand, best in industry and record high.
Free Cash Flow of $1.6 billion grew 26% year-over-year, best growth in industry and raising guidance.
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T-Mobile Revenue by Segment
Forward Guidance
T-Mobile raised its 2022 guidance across the board, including postpaid net customer additions, Core Adjusted EBITDA, and Free Cash Flow.
Positive Outlook
- Postpaid net customer additions are expected to be between 5.3 million and 5.8 million, an increase from prior guidance of 5.0 to 5.5 million.
- Core Adjusted EBITDA is expected to be between $25.8 billion and $26.2 billion, an increase from prior guidance of $25.6 to $26.1 billion.
- Net cash provided by operating activities is expected to be between $15.7 billion and $16.1 billion, an increase from prior guidance of $15.5 to $16.1 billion.
- Cash purchases of property and equipment are expected to be between $13.2 billion to $13.5 billion, an increase from the prior guidance of $13.0 to $13.5 billion.
- Free Cash Flow is expected to be between $7.2 billion and $7.6 billion, an increase from prior guidance of $7.1 to $7.6 billion.
Challenges Ahead
- Merger-related costs are expected to be between $4.5 billion and $5.0 billion before taxes.
- These costs are excluded from Core Adjusted EBITDA but will impact Net income, Net cash provided from operating activities and Free Cash Flow.
- T-Mobile is not able to forecast Net income on a forward-looking basis without unreasonable efforts due to the high variability and difficulty in predicting certain items that affect GAAP Net income.
- Core Adjusted EBITDA should not be used to predict Net income as the difference between this measure and Net income is variable.
- Free Cash Flow guidance does not assume any material net cash inflows from securitization in 2022.