T-Mobile US Q2 Earnings Call Highlights
Key Points
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- Strong Q2 operating performance: T-Mobile said it had an “extraordinary” quarter, adding 277,000 postpaid net accounts and posting strong growth in service revenue, EBITDA, and customer satisfaction. The company also reported a record net promoter score of 46.
- Guidance was reaffirmed and free cash flow outlook increased: Management kept its full-year outlook intact, including 950,000 to 1.05 million postpaid account additions and about $77 billion in service revenue. It raised adjusted free cash flow guidance by $200 million at the midpoint to $18.4 billion-$18.8 billion.
- Broadband and network strategy remain central: T-Mobile continues to see 5G broadband as a major growth driver, with broadband additions in the upper 400,000 range and ongoing fiber expansion. Executives also emphasized future spectrum opportunities and said satellite broadband is not viewed as a near-term threat.
T-Mobile US (NASDAQ:TMUS) executives said the company delivered another strong quarter in the second quarter of 2026, citing postpaid account growth, higher service revenue, broadband momentum and improving customer satisfaction as key drivers of the business.
President and CEO Srini Gopalan described the quarter as “extraordinary,” saying the company continued to execute on a strategy built around “the best network, the best value, and the best experience all in one place.” He pointed to a record net promoter score of 46, which he said was the highest NPS in wireless among the three largest U.S. carriers.
“This differentiation is why we outgrow the industry time and time again, and we did it again in Q2,” Gopalan said.
Postpaid Growth and Revenue Momentum
T-Mobile said it added 277,000 postpaid net accounts during the quarter. Gopalan said the company continued to gain postpaid household share across the top 100 markets as well as in smaller markets and rural areas.
He highlighted smaller markets and rural areas as a significant opportunity, noting that they represent about 40% of the population and that T-Mobile has “just 24% total share of households” in those areas. He also said the integration of UScellular, which T-Mobile acquired last year, is “going great.”
Gopalan said postpaid average revenue per account rose 2% year over year, while customer lifetime values increased by “healthy double digits” from a year earlier. He added that port-in ARPAs continued to exceed port-out ARPAs by about 20%, and that more than 60% of customers on new accounts selected premium plans.
Financially, Gopalan said postpaid service revenue rose 13% year over year, total service revenue increased 9%, and core adjusted EBITDA grew 12%. He also cited an “industry-leading free cash flow margin of 25%.”
Guidance Reaffirmed, Free Cash Flow Outlook Raised
CFO Peter Osvaldik said the second-quarter performance “reinforces” T-Mobile’s full-year outlook. The company continues to expect postpaid account net additions of 950,000 to 1,050,000 for 2026.
Osvaldik said T-Mobile expects roughly 250,000 postpaid account additions in the third quarter, reflecting a temporary increase in account churn tied to a planned rate plan modernization. He said the effect on postpaid phone churn is expected to be lower because the impact is concentrated more in accounts with fewer lines.
T-Mobile’s key guidance points included:
- Full-year service revenue of approximately $77 billion, representing 8% growth.
- Third-quarter service revenue of approximately $19.3 billion, up 6% year over year.
- Postpaid ARPA growth of 2.5% to 3% for the year.
- Full-year core adjusted EBITDA of $37.1 billion to $37.5 billion, representing 10% growth at the midpoint.
- Third-quarter core adjusted EBITDA of approximately $9.4 billion, up 8% year over year.
- Full-year cash capital expenditures of approximately $10 billion.
The company raised its adjusted free cash flow guidance by $200 million at the midpoint to a range of $18.4 billion to $18.8 billion, which Osvaldik said was primarily driven by lower cash income taxes.
Osvaldik also said T-Mobile repurchased an incremental $2.5 billion of stock in the second quarter and through July 17. Since beginning its share repurchase program in late 2022, he said the company has repurchased 253 million shares and reduced total shares outstanding to 1.07 billion.
Broadband, Fiber and Network Investments
Gopalan said T-Mobile’s 5G broadband product remains a major growth area and has “rapidly become a premium broadband offering.” He said the company’s latest generation router, combined with its network, delivers download speeds roughly equivalent to fiber-to-the-home when both are used over Wi-Fi, which he said is how most customers experience broadband.
In response to analyst questions, Osvaldik said total broadband additions were in the “upper 400,000 range” for the quarter and that the company again saw strong ARPUs. Executives reiterated that fixed wireless access is operated under a “fallow capacity model,” in which T-Mobile uses available network capacity after accounting for expected mobile usage.
Gopalan and President of Marketing, Strategy and Products André Almeida said the company does not view low Earth orbit satellite broadband as a near-term threat to its fixed wireless product. Almeida said two-thirds of T-Mobile’s broadband customers are in the top 100 markets, where satellite capacity is more constrained, and said the company’s broadband net promoter score is higher than other broadband categories, including fiber.
On fiber, Almeida said T-Mobile’s joint ventures are performing in line with expectations. He said the company is reaching close to 20% penetration within the first 12 months of deploying fiber in each area. Gopalan emphasized that T-Mobile is “not chasing some vanity number of homes passed” and is focused on creating equity value.
Pricing, Device Subsidies and Customer Value
Asked about the balance between volume growth and pricing, Gopalan said T-Mobile evaluates the trade-off through customer lifetime value. He said the company is carefully balancing subscriber volume and value creation, supported by improved network perception and stronger customer economics.
Osvaldik added that, excluding the effects of acquisitions and the company’s fiber joint venture, postpaid ARPA grew 3.7% year over year in the second quarter. He said that showed “the underlying strength of the business.”
On device subsidies, Gopalan said T-Mobile is not moving away from subsidies entirely, but is broadening its value proposition beyond “purely a free phone.” He said smartphone prices are rising because of memory price increases and that T-Mobile does not intend to increase subsidy levels, meaning customers will have to pay more for devices.
Gopalan also highlighted customer engagement initiatives, including the 10-year anniversary of T-Mobile Tuesdays and the company’s “Member Month” campaign. He said T-Life ended the quarter with more than 30 million monthly active users.
Spectrum, AI and Satellite Strategy
T-Mobile executives repeatedly emphasized future spectrum opportunities, including Upper C-band and 2.7 GHz spectrum expected in 2027 and 2028. Osvaldik said the company is maintaining a capital envelope that considers those opportunities, which he said could further strengthen network leadership and create additional 5G broadband capacity.
Gopalan said the company views upcoming spectrum availability as a chance to “drive further differentiation and cement our network leadership.” He compared the moment to T-Mobile’s earlier decision to lead in 5G standalone deployment.
President of Technology John Saw said T-Mobile has not seen a material surge in mobile network traffic from AI workloads, noting that much current AI demand is concentrated in wireline transport networks and data centers. Still, he said the company has prepared for future AI traffic through 5G Advanced capabilities such as uplink carrier aggregation, uplink MIMO and transmit switching.
On direct-to-device satellite service, Gopalan said satellite connectivity remains complementary to T-Mobile’s cellular network, accounting for only a very small share of usage. He said the company continues to progress toward a long-form agreement for a direct-to-device joint venture and expects most future activity to be sourced through that venture, while still allowing individual operators to have agreements with other parties.
About T-Mobile US (NASDAQ:TMUS)
T-Mobile US is a national wireless carrier that provides mobile voice, messaging and data services to consumers, businesses and wholesale customers across the United States, Puerto Rico and the U.S. Virgin Islands. The company operates a nationwide mobile network and offers device sales, equipment financing and support services through retail stores, online channels and distribution partners. T-Mobile positions its products around bundled service plans, device offerings and value-added features for both individual and enterprise customers.
Product offerings include postpaid and prepaid wireless plans under the T-Mobile and Metro by T-Mobile brands, as well as connectivity solutions for small and large businesses.
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