What changed in this filing

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Item 1. Financial Statements

2024-07-31 compared with 2024-04-26 · 351 added, 142 removed, 602 unchanged (45% of the section changed)

2 unchanged sentences

Condensed Consolidated Balance Sheets

(in millions, except share and per share amounts) March 31,

(in millions, except share and per share amounts) June 30,

2024 December 31,

48 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions, except share and per share amounts) 2024 2023 2024 2023

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Selling, general and administrative 5,142 5,272 10,280 10,697

Gain on disposal group held for sale — ( 42 )

Loss (gain) on disposal group held for sale — 17 — ( 25 )

Depreciation and amortization 3,248 3,110 6,619 6,313

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Interest expense, net ( 854 ) ( 861 ) ( 1,734 ) ( 1,696 )

Other income, net 20 9

Other (expense) income, net ( 8 ) 6 12 15

Total other expense, net ( 862 ) ( 855 ) ( 1,722 ) ( 1,681 )

5 unchanged sentences

Reclassification of loss from cash flow hedges, net of tax effect of $ 15 , $ 13 , $ 30 and $ 27

Net unrealized loss on fair value hedges, net of tax effect of $( 10 ), $ 0 , $( 10 ) and $ 0

( 30 ) — ( 30 ) —

Unrealized gain on foreign currency translation adjustment, net of tax effect of $ 0 , $ 0 , $ 0 and $ 0

Amortization of actuarial gain, net of tax effect of $( 1 ), $ 0 , $( 3 ) and $ 0

( 4 ) — ( 9 ) —

Other comprehensive income 9 47 47 89

10 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2024 2023 2024 2023

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Losses from sales of receivables 25 51 46 89

Gain on remeasurement of disposal group held for sale — ( 13 )

Loss on remeasurement of disposal group held for sale — 22 — 9

Changes in operating assets and liabilities

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Proceeds related to beneficial interests in securitization transactions 958 1,309 1,848 2,654

Acquisition of companies, net of cash acquired ( 390 ) — ( 390 ) —

Other, net ( 50 ) 24 ( 39 ) 19

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Condensed Consolidated Statement of Stockholders’ Equity

(in millions, except share and per share amounts) Common Stock Outstanding Treasury Stock Outstanding Treasury Shares at Cost Par Value and Additional Paid-in Capital Accumulated Other Comprehensive Loss Retained Earnings (Accumulated Deficit) Total Stockholders' Equity

Balance as of March 31, 2024 1,177,240,110 89,053,922 $ ( 12,982 ) $ 67,786 $ ( 926 ) $ 8,196 $ 62,074

Net income — — — — — 2,925 2,925

Dividends declared ($ 0.65 per share)

— — — — — ( 761 ) ( 761 )

Other comprehensive income — — — — 9 — 9

Stock-based compensation — — — 154 — — 154

Issuance of vested restricted stock units 291,907 — — — — — —

Shares withheld related to net share settlement of stock awards and stock options ( 91,844 ) — — ( 16 ) — — ( 16 )

Repurchases of common stock ( 13,979,843 ) 13,979,843 ( 2,289 ) — — — ( 2,289 )

Ka’ena Acquisition upfront consideration 3,264,952 — — 536 — — 536

Other, net 47,609 ( 1,614 ) 1 3 — — 4

Balance as of June 30, 2024 1,166,772,891 103,032,151 $ ( 15,270 ) $ 68,463 $ ( 917 ) $ 10,360 $ 62,636

Balance as of December 31, 2023 1,195,807,331 67,096,823 $ ( 9,373 ) $ 67,705 $ ( 964 ) $ 7,347 $ 64,715

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Repurchases of common stock ( 35,913,633 ) 35,913,633 ( 5,893 ) — — — ( 5,893 )

Ka’ena Acquisition upfront consideration 3,264,952 — — 536 — — 536

Other, net 109,361 21,695 ( 4 ) 12 — — 8

Balance as of June 30, 2024 1,166,772,891 103,032,151 $ ( 15,270 ) $ 68,463 $ ( 917 ) $ 10,360 $ 62,636

The accompanying notes are an integral part of these condensed consolidated financial statements.

Index for Notes to the Condensed Consolidated Financial Statements

T-Mobile US, Inc.

Condensed Consolidated Statement of Stockholders’ Equity

(in millions, except shares) Common Stock Outstanding Treasury Stock Outstanding Treasury Shares at Cost Par Value and Additional Paid-in Capital Accumulated Other Comprehensive Loss Retained Earnings (Accumulated Deficit) Total Stockholders' Equity

Balance as of March 31, 2023 1,204,696,325 55,910,664 $ ( 7,831 ) $ 74,043 $ ( 1,004 ) $ 1,717 $ 66,925

Net income — — — — — 2,221 2,221

Other comprehensive income — — — — 47 — 47

Stock-based compensation — — — 185 — — 185

Issuance of vested restricted stock units 1,321,269 — — — — — —

Shares withheld related to net share settlement of stock awards and stock options ( 483,892 ) — — ( 70 ) — — ( 70 )

Repurchases of common stock ( 25,183,838 ) 25,183,838 ( 3,561 ) — — — ( 3,561 )

Other, net 48,884 ( 3,963 ) — 3 — — 3

Balance as of June 30, 2023 1,180,398,748 81,090,539 $ ( 11,392 ) $ 74,161 $ ( 957 ) $ 3,938 $ 65,750

Balance as of December 31, 2022 1,233,960,078 22,916,449 $ ( 3,016 ) $ 73,941 $ ( 1,046 ) $ ( 223 ) $ 69,656

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Other, net 104,200 26,312 ( 5 ) 11 — — 6

Balance as of March 31, 2023 1,204,696,325 55,910,664 $ ( 7,831 ) $ 74,043 $ ( 1,004 ) $ 1,717 $ 66,925

Balance as of June 30, 2023 1,180,398,748 81,090,539 $ ( 11,392 ) $ 74,161 $ ( 957 ) $ 3,938 $ 65,750

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Summary of Significant Accounting Policies

Business Combination

Business Combinations

Joint Ventures

Receivables and Related Allowance for Credit Losses

Sales of Certain Receivables

Spectrum License Transactions

Goodwill, Spectrum License Transactions and Other Intangible Assets

Fair Value Measurements

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Additional Financial Information

Subsequent Events

Subsequent Event

Index for Notes to the Condensed Consolidated Financial Statements

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Estimates are inherently subject to judgment and actual results could differ from those estimates.

Foreign Currency Transactions

On May 8, 2024, we issued € 2.0 billion of euro (“EUR”) denominated debt.

T-Mobile’s functional currency is the U.S.

dollar (“USD”).

Each period, we convert activity and balances in EUR into USD using average exchange rates for the period for income statement amounts and using end-of-period or spot exchange rates for assets and liabilities.

We record transaction gains and losses resulting from the conversion of transaction currency to functional currency as a component of Other (expense) income, net on our Condensed Consolidated Statements of Comprehensive Income.

Derivative and Hedging Instruments

The Company manages its exposure to foreign exchange rates and interest rates through a risk management program that includes the use of derivative financial instruments, including cross-currency swaps.

We designate certain derivatives as accounting hedge relationships.

We do not hold derivatives for trading or speculative purposes.

We record derivatives on our Condensed Consolidated Balance Sheets and recognize them as either assets or liabilities at fair value.

Fair value is derived primarily from observable market data, and our derivatives are classified as Level 2 in the fair value hierarchy.

Cash flows associated with qualifying hedge derivative instruments are presented in the same category on our Condensed Consolidated Statements of Cash Flows as the item being hedged.

For fair value hedges, other than foreign currency hedges, the change in the fair value of the derivative instruments is recognized in earnings through the same income statement line item as the change in the fair value of the hedged item.

For cash flow hedges, as well as fair value foreign currency hedges, the change in the fair value of the derivative instruments is reported in Accumulated other comprehensive loss and recognized in earnings when the hedged item is recognized in earnings, again, through the same income statement line item.

Accounting Pronouncements Not Yet Adopted

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In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” The standard expands reportable segment disclosure requirements for public business entities primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit (referred to as the “significant expense principle”).

The standard will become effective for us for our fiscal year 2024 annual financial statements and interim financial statements thereafter and will be applied retrospectively for all prior periods presented in the financial statements, with early adoption permitted.

Improvements to Reportable Segment Disclosures.” The standard expands reportable segment disclosure requirements for public business entities primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit (referred to as the “significant expense principle”).

The standard will become effective for

Index for Notes to the Condensed Consolidated Financial Statements

us for our fiscal year 2024 annual financial statements and interim financial statements thereafter and will be applied retrospectively for all prior periods presented in the financial statements, with early adoption permitted.

We plan to adopt the standard when it becomes effective for us beginning in our fiscal year 2024 annual financial statements.

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The standard will be effective for us for our fiscal year 2025 annual financial statements with early adoption permitted.

We plan to adopt the standard when it becomes effective for us beginning in our fiscal year 2025 annual financial statements, and we expect the adoption of the standard will impact certain of our income tax disclosures.

Note 2 – Business Combination

Note 2 – Business Combinations

Acquisition of Ka’ena Corporation

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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

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 resulted 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.

Upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals, on May 1, 2024 (the “Acquisition Date”), we completed the Ka’ena Acquisition, and as a result, Ka’ena became a wholly owned subsidiary of T-Mobile.

Concurrently and as agreed upon through the Merger and Unit Purchase Agreement, T-Mobile and Ka’ena entered into certain separate transactions, including the effective settlement of the preexisting wholesale arrangement between T-Mobile and Ka’ena and agreements with certain of the sellers to provide services to T-Mobile during the post-acquisition period.

Ka’ena is a provider of prepaid mobile services in the U.S.

through its primary brands, Mint Mobile and Ultra Mobile, and also offers a selection of wireless devices, including handsets and other mobile communication devices.

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 on our Condensed Consolidated Statements of Comprehensive Income, and for which Ka’ena incurred related expenses for the use of our network.

On the Acquisition Date, 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.

The Ka’ena Acquisition enhances the Company’s position as a leading prepaid wireless carrier by diversifying our brand identities, enhancing our distribution footprint and preserving the value of our relationship with Ka’ena through its acquisition, including the acquisition of its prepaid customer relationships.

The financial results of Ka’ena from the Acquisition Date through June 30, 2024, were not material to our Condensed Consolidated Statements of Comprehensive Income, nor were they material to our prior period consolidated results on a pro forma basis.

Costs related to the Ka’ena Acquisition were not material to our Condensed Consolidated Statements of Comprehensive Income.

Consideration Transferred

In accordance with the terms of the Merger and Unit Purchase Agreement, 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.

The amount of the upfront payment is subject to customary adjustments within a 105-day review period.

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

Index for Notes to the Condensed Consolidated Financial Statements

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.

payment fair value of $ 956 million.

An additional amount of the upfront payment payable to certain sellers was deferred and may be paid through January 2026.

As of the Acquisition Date, we recognized a liability of $ 27 million for the fair value of this deferred amount, which is included in the fair value of consideration transferred in the Ka’ena Acquisition.

Furthermore, a portion of the upfront payment made on the Acquisition Date was for the settlement of the preexisting wholesale relationship with Ka’ena and excluded from the fair value of consideration transferred in the Ka’ena Acquisition.

Based on the amount of the upfront payment, 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.

• $ 241 million of the potential earnout amount is payment for the acquired Ka’ena business.

As of the Acquisition Date, we recognized a liability of $ 183 million for the fair value of such contingent consideration.

This liability will be adjusted to fair value at each future reporting date until settled, with a corresponding offset recorded to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

• $ 162 million of the potential earnout amount is payment for services to be provided to T-Mobile by certain of the sellers during the post-acquisition period, as well as the replacement of equity awards of certain Ka’ena employees.

We will record expense as such services are provided during the post-acquisition period within Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income, with a corresponding offset to Other current liabilities and Other long-term liabilities on our Condensed Consolidated Balance Sheets.

The acquisition-date fair value of consideration transferred in the Ka’ena Acquisition totaled $ 1.2 billion, comprised of the following:

(in millions) May 1, 2024

Fair value of T-Mobile common stock issued to Ka’ena stockholders on the Acquisition Date $ 527

Fair value of cash paid to Ka’ena stockholders on the Acquisition Date 413

Fair value of contingent consideration 183

Fair value of deferred consideration 27

Total fair value of consideration exchanged $ 1,150

The fair value of contingent consideration related to the earnout was estimated using the income approach, a probability-weighted discounted cash flow model, whereby a Monte Carlo simulation method estimated the probability of different outcomes.

This fair value measurement is based on significant inputs not observable in the market and, therefore, represents a Level 3 measurement as defined in ASC 820.

The key assumptions in applying the income approach for the contingent consideration include forecasted Ka’ena financial information, primarily revenue, marketing costs and customer metrics, the probability of achieving the forecasted financial information and the discount rate.

As of June 30, 2024, $ 183 million of liabilities for contingent consideration and $ 21 million of liabilities for post-acquisition services were presented within Other long-term liabilities on our Condensed Consolidated Balance Sheets.

Fair Value of Assets Acquired and Liabilities Assumed

We have accounted for the Ka’ena Acquisition as a business combination.

The identifiable assets acquired and liabilities assumed of Ka’ena were recorded at their provisionally assigned fair values as of the Acquisition Date and consolidated with those of T-Mobile.

Assigning fair values to the assets acquired and liabilities assumed at the Acquisition Date requires the use of judgment regarding estimates and assumptions.

For the provisionally assigned fair values of the assets acquired and liabilities assumed, we used the cost and income approaches.

Index for Notes to the Condensed Consolidated Financial Statements

The following table summarizes the provisionally assigned fair values for each class of assets acquired and liabilities assumed at the Acquisition Date.

We retained the services of certified valuation specialists to assist with assigning values to certain acquired assets.

We are in the process of finalizing the valuation of the assets acquired and liabilities assumed, including income tax-related amounts.

Therefore, the provisionally assigned fair values set forth below are subject to adjustment as additional information is obtained and the valuations are completed.

(in millions) May 1, 2024

Cash and cash equivalents $ 24

Accounts receivable 34

Prepaid expenses 5

Other current assets 10

Property and equipment 1

Operating lease right-of-use assets 2

Other intangible assets 740

Other assets 50

Total assets acquired 1,650

Accounts payable and accrued liabilities 42

Deferred revenue 297

Short-term operating lease liabilities 1

Deferred tax liabilities 86

Operating lease liabilities 2

Other long-term liabilities 72

Total liabilities assumed 500

Total consideration transferred $ 1,150

Intangible Assets

Goodwill with a provisionally assigned value of $ 781 million represents the excess of the consideration transferred over the fair values of assets acquired and liabilities assumed.

The provisionally assigned goodwill recognized includes expected growth in customers and service revenues to be achieved from the operations of the combined company, the assembled workforce of Ka’ena and intangible assets that do not qualify for separate recognition.

Of the total provisionally assigned amount of goodwill resulting from the Ka’ena Acquisition of $ 781 million, the preliminary amount deductible for tax purposes is $ 90 million.

All of the goodwill acquired is allocated to the Wireless reporting unit.

Other intangible assets acquired primarily include $ 545 million of customer relationships with an estimated weighted-average useful life of six years , $ 70 million of tradenames with an estimated weighted-average useful life of eight years and $ 125 million of other intangible assets with an estimated weighted-average useful life of four years .

The customer relationships are being amortized using the sum-of-the-years digits method over their estimated useful lives, and the tradenames are being amortized on a straight-line basis over their estimated useful lives.

The preliminary fair value of customer relationships was estimated using the income approach.

This fair value measurement is based on significant inputs not observable in the market, and, therefore, represents a Level 3 measurement as defined in ASC 820.

The key assumptions in applying the income approach include forecasted subscriber churn rates, revenue over an estimated period of time, the discount rate and estimated income taxes.

UScellular Wireless Operations

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.

Index for Notes to the Condensed Consolidated Financial Statements

Following the closing of the transaction, UScellular will retain ownership of its other spectrum, as well as its towers.

Subject to the closing of the transaction, we will enter into a 15-year master license agreement to lease space on at least 2,100 towers being retained.

Additionally, we will extend our tenancy term on approximately 600 towers where we are already leasing space from UScellular for 15 years post-closing.

We estimate the incremental future minimum lease payments associated with the master license agreement will be $ 1.4 billion over 15 years post-closing.

Note 3 – Joint Ventures

Lumos Joint Venture

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 by the joint venture 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.

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.

Metronet Joint Venture

Subsequent to June 30, 2024, on July 18, 2024, we entered into a definitive agreement with KKR & Co.

(“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.

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.

Note 4 – Receivables and Related Allowance for Credit Losses

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We also consider other qualitative factors such as current and forecasted macroeconomic conditions.

Index for Notes to the Condensed Consolidated Financial Statements

We consider the need to adjust our estimate of credit losses for reasonable and supportable forecasts of future macroeconomic conditions.

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To determine a customer’s credit profile and assist in determining their credit class, we use a proprietary credit scoring model that measures the credit quality of a customer leveraging several factors, such as credit bureau information and consumer credit risk scores, as well as service and device plan characteristics.

EIP receivables had a combined weighted-average effective interest rate of 11.1 % and 10.6 % as of March 31, 2024, and December 31, 2023, respectively.

Index for Notes to the Condensed Consolidated Financial Statements

EIP receivables had a combined weighted-average effective interest rate of 11.3 % and 10.6 % as of June 30, 2024, and December 31, 2023, respectively.

The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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We manage our EIP receivables portfolio segment using delinquency and customer credit class as key credit quality indicators.

The following table presents the amortized cost of our EIP receivables by delinquency status, customer credit class and year of origination as of March 31, 2024:

The following table presents the amortized cost of our EIP receivables by delinquency status, customer credit class and year of origination as of June 30, 2024:

Originated in 2024 Originated in 2023 Originated prior to 2023 Total EIP Receivables, Net of

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We multiply these estimated default probabilities by our estimated loss given default, which is the estimated amount of default or the severity of loss.

Index for Notes to the Condensed Consolidated Financial Statements

As we do for our accounts receivable portfolio segment, we consider the need to adjust our estimate of credit losses on EIP receivables for reasonable and supportable forecasts of economic conditions through monitoring external forecasts and periodic internal statistical analyses.

The following table presents write-offs of our EIP receivables by year of origination for the three months ended March 31, 2024:

The following table presents write-offs of our EIP receivables by year of origination for the six months ended June 30, 2024:

(in millions) Originated in 2024 Originated in 2023 Originated prior to 2023 Total Write-offs

Write-offs $ 30 $ 200 $ 53 $ 283

Index for Notes to the Condensed Consolidated Financial Statements

Activity for the three months ended March 31, 2024 and 2023, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows:

March 31, 2024 March 31, 2023

Activity for the six months ended June 30, 2024 and 2023, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows:

June 30, 2024 June 30, 2023

(in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total

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Off-Balance-Sheet Credit Exposures

We do not have material off-balance-sheet credit exposures as of March 31, 2024.

We do not have material off-balance-sheet credit exposures as of June 30, 2024.

In connection with the sales of certain service accounts receivable and EIP receivables pursuant to the sale arrangements, we have deferred purchase price assets included on our Condensed Consolidated Balance Sheets measured at fair value that are based on a discounted cash flow model using Level 3 inputs, including estimated customer default rates and credit worthiness, dilutions and recoveries.

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In 2015, we entered into an arrangement to sell certain EIP receivables on a revolving basis (the “EIP Sale Arrangement”), which has been revised and extended from time to time.

As of both March 31, 2024, and December 31, 2023, the EIP Sale Arrangement provided funding of $ 1.3 billion.

As of both June 30, 2024, and December 31, 2023, the EIP Sale Arrangement provided funding of $ 1.3 billion.

In connection with this EIP Sale Arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity (the “EIP BRE”).

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The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, included on our Condensed Consolidated Balance Sheets with respect to the EIP BRE:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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Other assets 88 103

Index for Notes to the Condensed Consolidated Financial Statements

Sales of Service Accounts Receivable

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On February 27, 2024, we extended the scheduled expiration date of the Service Receivable Sale Arrangement to February 25, 2025.

As of both March 31, 2024, and December 31, 2023, the Service Receivable Sale Arrangement provided funding of $ 775 million.

Index for Notes to the Condensed Consolidated Financial Statements

As of both June 30, 2024, and December 31, 2023, the Service Receivable Sale Arrangement provided funding of $ 775 million.

In connection with the Service Receivable Sale Arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity, to sell service accounts receivable (the “Service BRE”).

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The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included on our Condensed Consolidated Balance Sheets with respect to the Service BRE:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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The following table summarizes the impact of the sale of certain service accounts receivable and EIP receivables on our Condensed Consolidated Balance Sheets:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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The fair value of the deferred purchase price is determined based on a discounted cash flow model which uses primarily Level 3 inputs, including estimated customer default rates and credit worthiness, dilutions and recoveries.

As of March 31, 2024, and December 31, 2023, our deferred purchase price related to the sales of service accounts receivable and EIP receivables was $ 586 million and $ 658 million, respectively.

We recognized losses from sales of receivables, including changes in fair value of the deferred purchase price, of $ 21 million and $ 38 million for the three months ended March 31, 2024 and 2023, respectively, in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

As of June 30, 2024, and December 31, 2023, our deferred purchase price related to the sales of service accounts receivable and EIP receivables was $ 625 million and $ 658 million, respectively.

We recognized losses from sales of receivables, including changes in fair value of the deferred purchase price, of $ 25 million and $ 51 million for the three months ended June 30, 2024 and 2023, respectively, and $ 46 million and $ 89 million for the six months ended June 30, 2024 and 2023, respectively, in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

Continuing Involvement

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As the receivables are sold on a revolving basis, the customer payment collections on sold receivables may be reinvested in new receivable sales.

At the direction of the purchasers of the sold receivables, we apply the same policies and procedures while servicing the sold receivables as we apply to our owned receivables, and we continue to maintain normal relationships with our customers.

Index for Notes to the Condensed Consolidated Financial Statements

Note 5 – Spectrum License Transactions

The following table summarizes our spectrum license activity for the three months ended March 31, 2024:

the direction of the purchasers of the sold receivables, we apply the same policies and procedures while servicing the sold receivables as we apply to our owned receivables, and we continue to maintain normal relationships with our customers.

Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets

The change in the carrying amount of goodwill for the six months ended June 30, 2024, is as follows:

(in millions) Goodwill

Balance as of December 31, 2023, net of accumulated impairment losses of $ 10,984

Preliminary goodwill from the Ka’ena Acquisition in 2024 781

Balance as of June 30, 2024, net of accumulated impairment losses of $ 10,984

Spectrum Licenses

The following table summarizes our spectrum license activity for the six months ended June 30, 2024:

(in millions) 2024

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Spectrum licenses, end of period $ 98,661

Cash payments to acquire spectrum licenses and payments for costs to clear spectrum are included in Purchases of spectrum licenses and other intangible assets, including deposits, on our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024.

(1) As of June 30, 2024, $ 2.4 billion is included in Other current liabilities on our Condensed Consolidated Balance Sheets related to the closing of the first tranche of the License Purchase Agreement with Channel 51 License Co LLC and LB License Co, LLC discussed below.

Spectrum Transactions

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On February 29, 2024, the FCC issued to us the licenses won in Auction 108, and substantially all of these licenses were deployed in March 2024.

The licenses are included in Spectrum licenses on our Condensed Consolidated Balance Sheets as of March 31, 2024.

The licenses are included in Spectrum licenses on our Condensed Consolidated Balance Sheets as of June 30, 2024.

Spectrum Exchange Transactions

During the three and six months ended June 30, 2024, we recognized gains associated with the closing of certain spectrum exchange transactions of $ 22 million and $ 47 million, respectively, as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

There were no gains and losses associated with spectrum exchange transactions during the three and six months ended June 30, 2023.

As of June 30, 2024, $ 1.0 billion of spectrum licenses were classified as held for sale within Other assets on our Condensed Consolidated Balance Sheets related to spectrum exchange agreements pending regulatory approval and closing, which are expected to close in the next twelve months.

The closings of these transactions are not expected to have a significant impact on our Condensed Consolidated Statements of Comprehensive Income.

License Purchase Agreements

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On July 1, 2020, we and DISH Network Corporation (“DISH”) entered into a license purchase agreement (the “DISH License Purchase Agreement”) pursuant to which DISH agreed to purchase certain 800 MHz spectrum licenses for a total of approximately $ 3.6 billion.

The closing of the sale of spectrum under the DISH License Purchase Agreement remains subject to FCC approval.

On October 15, 2023, we and DISH entered into an amendment (the “LPA Amendment”) to the DISH License Purchase Agreement pursuant to which, among other things, the parties agreed that (1) DISH will pay us a $ 100 million non-refundable extension fee (in lieu of the approximately $ 72 million termination fee that had previously been agreed to), (2) the closing for the purchase of the spectrum licenses by DISH will occur no later than April 1, 2024, (3) if DISH has not purchased the spectrum licenses by such date for any reason (including failure to receive the required FCC approval prior to such date), then the DISH License Purchase Agreement will automatically terminate, and we will retain the $ 100 million extension fee, (4) if DISH does purchase the spectrum by April 1, 2024, the $ 100 million extension fee will be credited against the $ 3.6 billion purchase price, and (5) we are permitted to commence auction of the spectrum prior to April 1, 2024 at our discretion (and subject to DISH’s purchase right).

Index for Notes to the Condensed Consolidated Financial Statements

agreed to), (2) the closing for the purchase of the spectrum licenses by DISH will occur no later than April 1, 2024, (3) if DISH has not purchased the spectrum licenses by such date for any reason (including failure to receive the required FCC approval prior to such date), then the DISH License Purchase Agreement will automatically terminate, and we will retain the $ 100 million extension fee, (4) if DISH does purchase the spectrum by April 1, 2024, the $ 100 million extension fee will be credited against the $ 3.6 billion purchase price, and (5) we are permitted to commence auction of the spectrum prior to April 1, 2024 at our discretion (and subject to DISH’s purchase right).

The LPA Amendment was approved by the Court and became effective on October 23, 2023.

On October 25, 2023, we received a payment of $ 100 million from DISH for the extension fee and recorded a corresponding liability within Other current liabilities on our Condensed Consolidated Balance Sheets.

Subsequent to March 31, 2024, DISH did not purchase the 800 MHz spectrum by April 1, 2024.

As such, we will recognize a gain for the $ 100 million extension fee previously paid by DISH in the second quarter of 2024 within Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income and relieve the liability that was initially recorded upon receipt of the payment.

DISH did not purchase the 800 MHz spectrum by April 1, 2024.

As such, we recognized a gain for the $ 100 million extension fee previously paid by DISH during the three months ended June 30, 2024, within Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income and relieved the liability that was initially recorded upon receipt of the payment.

Additionally, we have commenced an auction process for the disposition of the spectrum as required under the final judgment agreed to by us, Deutsche Telekom AG (“DT”), Sprint LLC, 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.

If the specified minimum price of $ 3.6 billion is not met in the auction, we would be relieved of the obligation to sell the licenses.

District Court for the District of Columbia, which was approved by the Court on April 1, 2020, to offer the licenses for sale.

If the specified minimum price of $ 3.6 billion is not met during the six-month auction period ending October 1, 2024, we would be relieved of the obligation to sell the licenses.

Channel 51 License Co LLC and LB License Co, LLC

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The licenses will be acquired without any associated networks and are currently being utilized by us through exclusive leasing arrangements with the Sellers.

Index for Notes to the Condensed Consolidated Financial Statements

On March 30, 2023, we and the Sellers entered into Amended and Restated License Purchase Agreements pursuant to which we and the Sellers agreed to separate the transaction into two tranches of licenses, with the closings on the acquisitions of certain licenses in Chicago, Dallas and New Orleans being deferred in order to potentially expedite the regulatory approval process for the remainder of the licenses.

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The licenses being acquired by us, and the total consideration being paid for the licenses, remain the same under the original License Purchase Agreements and subsequent amendments.

The FCC approved the purchase of the first tranche on December 29, 2023, and we expect the closing of the first tranche to occur in the second quarter of 2024, with the associated cash payment expected to occur in the third quarter of 2024.

The FCC approved the purchase of the first tranche on December 29, 2023.

The first tranche closed on June 24, 2024, with the associated payment of $ 2.4 billion due August 5, 2024.

We anticipate that the second closing (on the deferred licenses) will occur in late 2024 or early 2025.

The parties have agreed that each of the closings will occur within 180 days after the receipt of the applicable required regulatory approvals, and payment of each portion of the aggregate $ 3.5 billion purchase price will occur no later than 40 days after the date of each respective closing.

Other Intangible Assets

The components of Other intangible assets were as follows:

Useful Lives June 30, 2024 December 31, 2023

(in millions) Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount

Customer relationships (1)

Up to 8 years

$ 5,428 $ ( 3,780 ) $ 1,648 $ 4,883 $ ( 3,451 ) $ 1,432

Reacquired rights Up to 9 years

770 ( 277 ) 493 770 ( 231 ) 539

Tradenames and patents (1)

Up to 19 years

325 ( 145 ) 180 208 ( 134 ) 74

Favorable spectrum leases Up to 27 years

672 ( 165 ) 507 686 ( 148 ) 538

Up to 10 years

478 ( 328 ) 150 353 ( 318 ) 35

Other intangible assets $ 7,673 $ ( 4,695 ) $ 2,978 $ 6,900 $ ( 4,282 ) $ 2,618

(1) Includes intangible assets acquired in the Ka’ena Acquisition.

See Note 2 - Business Combina tions for more information.

Index for Notes to the Condensed Consolidated Financial Statements

Amortization expense for intangible assets subject to amortization was $ 205 million and $ 215 million for the three months ended June 30, 2024 and 2023, respectively, and $ 416 million and $ 469 million for the six months ended June 30, 2024 and 2023, respectively.

The estimated aggregate future amortization expense for intangible assets subject to amortization is summarized below:

(in millions) Estimated Future Amortization

Twelve Months Ending June 30,

Thereafter 448

Total $ 2,978

Note 7 – Fair Value Measurements

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Derivative Financial Instruments

Periodically, we use derivatives to manage exposure to market risk, such as interest rate risk.

We designate certain derivatives as hedging instruments in a qualifying hedge accounting relationship to help minimize significant, unplanned fluctuations in cash flows or fair values caused by designated market risks, such as interest rate volatility.

We use derivatives to manage exposure to market risk, such as exposure to fluctuations in foreign currency exchange rates and interest rates.

We designate certain derivatives as hedging instruments in a qualifying hedge accounting relationship to mitigate fluctuations in values or cash flows related to such risks caused by foreign currency or interest rate volatility.

We do not use derivatives for trading or speculative purposes.

Cash flows associated with qualifying hedge derivative instruments are presented in the same category on our Condensed Consolidated Statements of Cash Flows as the item being hedged.

For fair value hedges, the change in the fair value of the derivative instruments is recognized in earnings through the same income statement line item as the change in the fair value of the hedged item.

For cash flow hedges, the change in the fair value of the derivative instruments is reported in Other comprehensive income and recognized in earnings when the hedged item is recognized in earnings, again, through the same income statement line item.

We did not have any significant derivative instruments outstanding as of March 31, 2024, and December 31, 2023.

We record derivatives on our Condensed Consolidated Balance Sheets at fair value that is derived primarily from observable market data, including exchange rates, interest rates and forward curves.

These market inputs are utilized in the discounted cash flow calculation considering the instrument's term, notional amount, discount rate and credit risk.

Significant inputs to derivative valuations are generally observable in active markets and, as such, are classified as Level 2 in the fair value hierarchy.

Cross-Currency Swaps

We enter into cross-currency swaps to offset changes in value of our payments on foreign-denominated debt in USD and to mitigate the impact of foreign currency transaction gains and losses.

On April 30, 2024, we entered into cross-currency swap agreements, with the same notional amounts as the EUR-denominated debt issuance on May 8, 2024, to effectively convert € 2.0 billion to USD borrowings, with the same maturities of five , eight and 12 years.

The swaps qualify and have been designated as fair value hedges of our EUR-denominated debt, mitigating our exposure to foreign currency transaction gains and losses.

Accordingly, all changes in the fair value of the cross-currency swaps will be initially recorded through Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets and reclassified to earnings in an amount that exactly offsets the periodic transaction gain or loss on remeasuring the debt, such that there will be no earnings volatility due to changes in foreign-currency exchange rates.

Transaction gains or losses on remeasuring the EUR-denominated debt, as well as the

Index for Notes to the Condensed Consolidated Financial Statements

offsetting swap amounts, are recorded within Other (expense) income, net on our Condensed Consolidated Statements of Comprehensive Income.

Changes in the fair value of the swaps may be different from the current period transaction gain or loss on remeasurement of the debt, in which case the difference will remain in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets.

These differences generally represent credit or liquidity risk, referred to as a basis spread, and the time value of money (“excluded components”).

The value of the excluded components is recognized in earnings using a systematic and rational method by accruing the current-period swap settlements into Interest expense, net, on our Condensed Consolidated Statements of Comprehensive Income.

If an amount remains in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets upon settlement of the derivative, those amounts will be reclassified to earnings at that time.

During the three months ended June 30, 2024, we recognized a pre-tax loss of $ 47 million in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets related to these swaps.

During the three months ended June 30, 2024, $ 7 million of the loss recognized in Accumulated other comprehensive loss was reclassified to Other (expense) income, net, on our Condensed Consolidated Statements of Comprehensive Income to exactly offset the related pre-tax foreign currency transaction gain on the underlying EUR-denominated debt.

Interest Rate Lock Derivatives

In April 2020, we terminated our interest rate lock derivatives entered into in October 2018.

Aggregate changes in the fair value of the interest rate lock derivatives, net of tax and amortization, of $ 1.1 billion are presented in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets as of both March 31, 2024, and December 31, 2023.

For the three months ended March 31, 2024 and 2023, $ 57 million and $ 53 million, respectively, were amortized from Accumulated other comprehensive loss into Interest expense, net, on our Condensed Consolidated Statements of Comprehensive Income.

We expect to amortize $ 241 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense, net, over the 12 months ending March 31, 2025.

Aggregate changes in the fair value of our interest rate lock derivatives, which were terminated in April 2020, of $ 1.1 billion are presented in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets as of both June 30, 2024, and December 31, 2023.

During the three months ended June 30, 2024 and 2023, $ 59 million and $ 55 million, respectively, and during the six months ended June 30, 2024 and 2023, $ 116 million and $ 108 million, respectively, were amortized from Accumulated other comprehensive loss into Interest expense, net, on our Condensed Consolidated Statements of Comprehensive Income.

We expect to amortize $ 245 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense, net, over the 12 months ending June 30, 2025.

Deferred Purchase Price Assets

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See Note 5 – Sales of Certain Receivables for further information.

Index for Notes to the Condensed Consolidated Financial Statements

The carrying amounts of our deferred purchase price assets, which are measured at fair value on a recurring basis and are included on our Condensed Consolidated Balance Sheets, were $ 586 million and $ 658 million as of March 31, 2024, and December 31, 2023, respectively.

The fair value of our Senior Notes and spectrum-backed Senior Secured Notes to third parties was determined based on quoted market prices in active markets, and therefore were classified as Level 1 within the fair value hierarchy.

The carrying amounts of our deferred purchase price assets, which are measured at fair value on a recurring basis and are included on our Condensed Consolidated Balance Sheets, were $ 625 million and $ 658 million as of June 30, 2024, and December 31, 2023, respectively.

The fair value of our Senior Notes and spectrum-backed Senior Secured Notes to third parties was determined based on quoted market prices in active markets.

Accordingly, our Senior Notes and spectrum-backed Senior Secured Notes to third parties were classified as Level 1 within the fair value hierarchy.

The fair value of our Senior Notes to affiliates was determined based on a discounted cash flow approach using market interest rates of instruments with similar terms and maturities and an estimate for our standalone credit risk.

Accordingly, our Senior Notes to affiliates were classified as Level 2 within the fair value hierarchy.

The fair value of our asset-backed notes (“ABS Notes”) was primarily based on quoted prices in inactive markets for identical instruments and observable changes in market interest rates, both of which are Level 2 inputs.

Accordingly, our ABS Notes were classified as Level 2 within the fair value hierarchy.

Although we have determined the estimated fair values using available market information and commonly accepted valuation methodologies, judgment was required in interpreting market data to develop fair value estimates for the Senior Notes to affiliates and ABS Notes.

The fair value estimates were based on information available as of March 31, 2024, and December 31, 2023.

The fair value of our Senior Notes to third parties (EUR-denominated) and asset-backed notes (“ABS Notes”) was primarily based on quoted prices in inactive markets for identical instruments and observable changes in market interest rates, both of which are Level 2 inputs.

Accordingly, our Senior Notes to third parties (EUR-denominated) and ABS Notes were classified as Level 2 within the fair value hierarchy.

The fair value estimates were based on information available as of June 30, 2024, and December 31, 2023.

As such, our estimates are not necessarily indicative of the amount we could realize in a current market exchange.

Index for Notes to the Condensed Consolidated Financial Statements

The carrying amounts and fair values of our short-term and long-term debt included on our Condensed Consolidated Balance Sheets were as follows:

(in millions) Level within the Fair Value Hierarchy March 31, 2024 December 31, 2023

(in millions) Level within the Fair Value Hierarchy June 30, 2024 December 31, 2023

Carrying Amount Fair Value Carrying Amount Fair Value

Senior Notes to third parties 1 $ 70,874 $ 64,705 $ 70,493 $ 65,962

Senior Notes to third parties (EUR-denominated) 2 2,129 2,141 — —

Senior Notes to affiliates 2 1,496 1,484 1,496 1,499

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Note 8 – Debt

The following table sets forth the debt balances and activity as of, and for the three months ended, March 31, 2024 :

The following table sets forth the debt balances and activity as of, and for the six months ended, June 30, 2024:

(in millions) December 31,

2023 Proceeds from Issuances and Borrowings (1)

Repayments Reclassifications (1)

Note Redemptions Repayments Reclassifications (1)

Short-term debt $ 3,619 $ — $ ( 2,500 ) $ ( 446 ) $ 5,240 $ ( 46 ) $ 5,867

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(1) Issuances and borrowings and reclassifications are recorded net of accrued or paid issuance costs and discounts.

(2) Other includes the amortization of premiums, discounts, debt issuance costs and consent fees.

Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.1 % and 4.0 % on weighted-average debt outstanding of $ 77.4 billion and $ 73.4 billion for the three months ended March 31, 2024 and 2023, respectively.

(2) Other includes the amortization of premiums, discounts, debt issuance costs and consent fees and the impact from changes in foreign currency exchange rates.

Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.1 % and 4.0 % on weighted-average debt outstanding of $ 78.6 billion and $ 76.4 billion for the three months ended June 30, 2024 and 2023, respectively, and 4.1 % and 4.0 % on weighted-average debt outstanding of $ 78.0 billion and $ 74.9 billion for the six months ended June 30, 2024 and 2023, respectively.

The weighted-average debt outstanding was calculated by applying an average of the monthly ending balances of total short-term and long-term debt to third parties and short-term and long-term debt to affiliates, net of unamortized premiums, discounts, debt issuance costs and consent fees.

Index for Notes to the Condensed Consolidated Financial Statements

Issuances and Borrowings

During the three months ended March 31, 2024, we issued the following Senior Notes:

During the six months ended June 30, 2024, we issued the following Senior Notes:

(in millions) Principal Issuances Discounts and Issuance Costs, Net Net Proceeds from Issuance of Long-Term Debt Issue Date

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750 ( 7 ) 743 January 12, 2024

3.550 % Senior Notes due 2029 (EUR-denominated)

645 ( 3 ) 642 May 8, 2024

3.700 % Senior Notes due 2032 (EUR-denominated)

806 ( 4 ) 802 May 8, 2024

3.850 % Senior Notes due 2036 (EUR-denominated)

699 ( 7 ) 692 May 8, 2024

Total of Senior Notes issued $ 5,150 $ ( 38 ) $ 5,112

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Total of ABS Notes issued $ 500 $ ( 3 ) $ 497

Note Repayments

During the three months ended March 31, 2024, we made the following repayments:

(in millions) Principal Amount Repayment Date

Index for Notes to the Condensed Consolidated Financial Statements

Note Redemption and Repayments

During the six months ended June 30, 2024, we made the following redemption and repayments:

(in millions) Principal Amount Payment Date

7.125 % Senior Notes due 2024

$ 2,500 June 15, 2024

Total Redemption $ 2,500

4.738 % Secured Series 2018-1 A-1 Notes due 2025

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These ABS Notes are secured by $ 662 million of gross EIP receivables and future collections on such receivables.

Net proceeds of $ 497 million from these ABS Notes are presented in Proceeds from issuance of long-term debt on our Condensed Consolidated Statements of Cash Flows in the three months ended March 31, 2024.

As of March 31, 2024, $ 1.3 billion of our ABS Notes were secured in total by $ 1.7 billion of gross EIP receivables and future collections on such receivables.

Net proceeds of $ 497 million from these ABS Notes are presented in Proceeds from issuance of long-term debt on our Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024.

As of June 30, 2024, $ 1.3 billion of our ABS Notes were secured in total by $ 1.6 billion of gross EIP receivables and future collections on such receivables.

Our ABS Notes and the assets securing this debt are included on our Condensed Consolidated Balance Sheets.

The expected maturities of our ABS Notes as of March 31, 2024, were as follows:

The expected maturities of our ABS Notes as of June 30, 2024, were as follows:

(in millions) Expected Maturities

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Accordingly, we include the balances and results of operations of the ABS Entities in our condensed consolidated financial statements.

Index for Notes to the Condensed Consolidated Financial Statements

The following table summarizes the carrying amounts and classification of assets and liabilities included in our Condensed Consolidated Balance Sheets with respect to the ABS Entities:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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See Note 4 – Receivables and Related Allowance for Credit Losses for additional information on the EIP receivables used to secure the ABS Notes.

Index for Notes to the Condensed Consolidated Financial Statements

Restricted Cash

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Prior to our merger with Sprint (the “Merger”), Sprint entered into a lease-out and leaseback arrangement with Global Signal Inc., a third party that was subsequently acquired by CCI, that conveyed to CCI the exclusive right to manage and operate approximately 6,400 tower sites (“Master Lease Sites”) via a master prepaid lease.

These agreements were assumed upon the

Index for Notes to the Condensed Consolidated Financial Statements

close of the Merger, at which point the remaining term of the lease-out was approximately 17 years with no renewal options.

These agreements were assumed upon the close of the Merger, at which point the remaining term of the lease-out was approximately 17 years with no renewal options.

CCI has a fixed price purchase option for all (but not less than all) of the leased or subleased sites for approximately $ 2.3 billion, exercisable one year prior to the expiration of the agreement and ending 120 days prior to the expiration of the agreement.

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The tower assets are reported in Property and equipment, net on our Condensed Consolidated Balance Sheets and are depreciated to their estimated residual values over the expected useful life of the towers, which is 20 years.

Index for Notes to the Condensed Consolidated Financial Statements

Leaseback Arrangement

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The following table summarizes the balances associated with both of the tower arrangements on our Condensed Consolidated Balance Sheets:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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Other long-term liabilities 554 554

Future minimum payments related to the tower obligations are approximately $ 421 million for the 12-month period ending March 31, 2025, $ 774 million in total for both of the 12-month periods ending March 31, 2026 and 2027, $ 816 million in total for both of the 12-month periods ending March 31, 2028 and 2029, and $ 4.0 billion in total thereafter.

Future minimum payments related to the tower obligations are approximately $ 407 million for the 12-month period ending June 30, 2025, $ 778 million in total for both of the 12-month periods ending June 30, 2026 and 2027, $ 822 million in total for both of the 12-month periods ending June 30, 2028 and 2029, and $ 3.9 billion in total thereafter.

We are contingently liable for future ground lease payments through the remaining term of the CCI Lease Sites and the Master Lease Sites.

These contingent obligations are not included in Operating lease liabilities, as any amount due is contractually owed by CCI based on the subleasing arrangement.

Under the arrangement, we remain primarily liable for ground lease payments on approximately 900 sites and have included lease liabilities of $ 241 million in our Operating lease liabilities as of March 31, 2024.

Under the arrangement, we remain primarily liable for ground lease payments on approximately 900 sites and have included lease liabilities of $ 245 million in our Operating lease liabilities as of June 30, 2024.

Note 10 – Revenue from Contracts with Customers

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• Wholesale customers include Machine-to-Machine and Mobile Virtual Network Operator customers that operate on our network but are managed by wholesale partners.

Index for Notes to the Condensed Consolidated Financial Statements

Postpaid service revenues, including postpaid phone revenues and postpaid other revenues, were as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2024 2023 2024 2023

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Revenue generated from the lease of mobile communication devices is included in Equipment revenues on our Condensed Consolidated Statements of Comprehensive Income.

Index for Notes to the Condensed Consolidated Financial Statements

Contract Balances

The contract asset and contract liability balances from contracts with customers as of March 31, 2024, and December 31, 2023, were as follows:

The contract asset and contract liability balances from contracts with customers as of June 30, 2024, and December 31, 2023, were as follows:

(in millions) Contract

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Balance as of December 31, 2023 $ 607 $ 812

Balance as of March 31, 2024 548 836

Balance as of June 30, 2024 544 1,091

Change $ ( 63 ) $ 279

1 unchanged sentence

The change in the contract asset balance includes customer activity related to new promotions, offset by billings on existing contracts and impairment, which is recognized as bad debt expense.

The current portion of our contract assets of approximately $ 449 million and $ 495 million as of March 31, 2024, and December 31, 2023, respectively, was included in Other current assets on our Condensed Consolidated Balance Sheets.

The current portion of our contract assets of approximately $ 409 million and $ 495 million as of June 30, 2024, and December 31, 2023, respectively, was included in Other current assets on our Condensed Consolidated Balance Sheets.

Contract liabilities are recorded when fees are collected, or we have an unconditional right to consideration (a receivable) in advance of delivery of goods or services.

Changes in contract liabilities are primarily related to the activity of prepaid customers.

Changes in contract liabilities are primarily related to the activity of prepaid customers, including customers acquired through the Ka’ena Acquisition.

Contract liabilities are primarily included in Deferred revenue on our Condensed Consolidated Balance Sheets.

Revenues for the three months ended March 31, 2024 and 2023 include the following:

Three Months Ended March 31,

Revenues for the three and six months ended June 30, 2024 and 2023 include the following:

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Remaining Performance Obligations

As of March 31, 2024, the aggregate amount of transaction price allocated to remaining service performance obligations for postpaid contracts with subsidized devices and promotional bill credits that result in an extended service contract is $ 1.3 billion.

As of June 30, 2024, the aggregate amount of the transaction price allocated to remaining service performance obligations for postpaid contracts with subsidized devices and promotional bill credits that result in an extended service contract is $ 1.1 billion.

We expect to recognize revenue as the service is provided on these postpaid contracts over an extended contract term of 24 months from the time of origination.

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This variable consideration has been excluded from the disclosure of remaining performance obligations.

As of March 31, 2024, the aggregate amount of the contractual minimum consideration for wholesale, roaming and service contracts is $ 1.3 billion, $ 1.6 billion and $ 2.8 billion for the remainder of 2024, 2025, and 2026 and beyond, respectively.

These contracts have a remaining duration ranging from less than one year to eight years .

Index for Notes to the Condensed Consolidated Financial Statements

As of June 30, 2024, the aggregate amount of the contractual minimum consideration for wholesale, roaming and service contracts is $ 637 million, $ 1.4 billion and $ 3.2 billion for the remainder of 2024, 2025, and 2026 and beyond, respectively.

These contracts have a remaining duration ranging from less than one year to seven years .

Contract Costs

The balance of deferred incremental costs to obtain contracts with customers was $ 2.1 billion as of both March 31, 2024, and December 31, 2023, and is included in Other assets on our Condensed Consolidated Balance Sheets.

The balance of deferred incremental costs to obtain contracts with customers was $ 2.0 billion and $ 2.1 billion for June 30, 2024 and December 31, 2023, respectively, and is included in Other assets on our Condensed Consolidated Balance Sheets.

Deferred contract costs incurred to obtain postpaid service contracts are amortized over a period of 24 months.

The amortization period is monitored to reflect any significant change in assumptions.

Amortization of deferred contract costs included in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income were $ 489 million and $ 422 million for the three months ended March 31, 2024 and 2023, respectively.

Amortization of deferred contract costs included in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income were $ 489 million and $ 444 million for the three months ended June 30, 2024 and 2023, respectively, and $ 978 million and $ 866 million for the six months ended June 30, 2024 and 2023, respectively.

The deferred contract cost asset is assessed for impairment on a periodic basis.

There were no impairment losses recognized on deferred contract cost assets for the three months ended March 31, 2024 and 2023.

There were no impairment losses recognized on deferred contract cost assets for the three and six months ended June 30, 2024 and 2023.

Index for Notes to the Condensed Consolidated Financial Statements

Note 11 – Stockholder Return Program

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On January 24, 2024, our Board of Directors declared a cash dividend of $ 0.65 per share on our issued and outstanding common stock, which was paid on March 14, 2024, to stockholders of record as of the close of business on March 1, 2024.

On March 15, 2024, our Board of Directors declared a cash dividend of $ 0.65 per share on our issued and outstanding common stock, which is payable on June 13, 2024, to stockholders of record as of the close of business on May 31, 2024.

During the three months ended March 31, 2024, we paid an aggregate of $ 769 million in cash dividends to our stockholders, which was presented within Net cash used in financing activities on our Condensed Consolidated Statements of Cash Flows, of which $ 388 million was paid to DT.

As of March 31, 2024, $ 756 million for dividends payable is presented within Other current liabilities on our Condensed Consolidated Balance Sheets, of which $ 386 million is payable to DT.

During the three months ended March 31, 2024, we repurchased 21,933,790 shares of our common stock at an average price per share of $ 162.69 for a total purchase price of $ 3.6 billion under the 2023-2024 Stockholder Return Program.

All shares repurchased during the three months ended March 31, 2024, were purchased at market price.

As of March 31, 2024, we had up to $ 11.7 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024.

The next quarterly cash dividend will be paid on June 13, 2024.

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.

Index for Notes to the Condensed Consolidated Financial Statements

On March 15, 2024, our Board of Directors declared a cash dividend of $ 0.65 per share on our issued and outstanding common stock, which was paid on June 13, 2024, to stockholders of record as of the close of business on May 31, 2024.

On June 13, 2024, our Board of Directors declared a cash dividend of $ 0.65 per share on our issued and outstanding common stock, which will be paid on September 12, 2024, to stockholders of record as of the close of business on August 30, 2024.

During the three and six months ended June 30, 2024, we paid an aggregate of $ 759 million and $ 1.5 billion, respectively, in cash dividends to our stockholders, which was presented within Net cash used in financing activities on our Condensed Consolidated Statements of Cash Flows, of which during the three and six months ended June 30, 2024, $ 381 million and $ 769 million, respectively, was paid to DT.

As of June 30, 2024, $ 758 million for dividends payable is presented within Other current liabilities on our Condensed Consolidated Balance Sheets, of which $ 383 million is payable to DT.

During the three months ended June 30, 2024, we repurchased 13,979,843 shares of our common stock at an average price per share of $ 162.85 for a total purchase price of $ 2.3 billion, and during the six months ended June 30, 2024, we repurchased 35,913,633 shares of our common stock at an average price per share of $ 162.75 for a total purchase price of $ 5.8 billion, under the 2023-2024 Stockholder Return Program.

All shares repurchased during the six months ended June 30, 2024, were purchased at market price.

As of June 30, 2024, we had up to $ 8.7 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024.

The next quarterly cash dividend will be paid on September 12, 2024.

Note 12 – Earnings Per Share

The computation of basic and diluted earnings per share was as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions, except shares and per share amounts) 2024 2023 2024 2023

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SoftBank contingent consideration (1)

— 48,751,557 — 48,751,557

Ka’ena Acquisition contingent consideration (2)

932,755 — 466,377 —

(1) Represents the weighted-average number of shares (“SoftBank Specified Shares”) that were contingently issuable from the Merger date of April 1, 2020, pursuant to a letter agreement dated February 20, 2020, between T-Mobile, SoftBank and DT (the “Letter Agreement”).

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On December 28, 2023, the Company issued the SoftBank Specified Shares to SoftBank in accordance with the Letter Agreement.

As of March 31, 2024, we had authorized 100 million shares of preferred stock, with a par value of $ 0.00001 per share.

There was no preferred stock outstanding as of March 31, 2024 and 2023.

(2) The weighted-average number of shares contingently issuable related to the Ka’ena Acquisition earnout consideration (“Ka’ena Contingent Shares”) are included in potentially dilutive securities based on the maximum number of shares contingently issuable for the earnout and the 20 trading day volume-weighted average price as of June 30, 2024.

No Ka’ena Contingent Shares were outstanding during the six months ended June 30, 2024, as the threshold specified performance indicators had not been achieved.

Index for Notes to the Condensed Consolidated Financial Statements

As of June 30, 2024, we had authorized 100 million shares of preferred stock, with a par value of $ 0.00001 per share.

There was no preferred stock outstanding as of June 30, 2024 and 2023.

Potentially dilutive securities were not included in the computation of diluted earnings per share if to do so would have been anti-dilutive.

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An accrual is established when we believe it is both probable that a loss has been incurred and an amount can be reasonably estimated.

Index for Notes to the Condensed Consolidated Financial Statements

other matters, where we have not determined that a loss is probable or because the amount of loss cannot be reasonably estimated, we have not recorded an accrual due to various factors typical in contested proceedings, including, but not limited to, uncertainty concerning legal theories and their resolution by courts or regulators, uncertain damage theories and demands, and a less than fully developed factual record.

For other matters, where we have not determined that a loss is probable or because the amount of loss cannot be reasonably estimated, we have not recorded an accrual due to various factors typical in contested proceedings, including, but not limited to, uncertainty concerning legal theories and their resolution by courts or regulators, uncertain damage theories and demands, and a less than fully developed factual record.

For Litigation and Regulatory Matters that may result in a contingent gain, we recognize such gains on our condensed consolidated financial statements when the gain is realized or realizable.

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As such, our view of these matters is subject to inherent uncertainties and may change in the future.

On February 28, 2020, we received a Notice of Apparent Liability for Forfeiture and Admonishment from the FCC, which proposed a penalty against us for allegedly violating section 222 of the Communications Act and the FCC’s regulations governing the privacy of customer information.

We have included an accrual for the settlement amount that we believe to be probable in Accounts payable and accrued liabilities on our Condensed Consolidated Balance Sheets as of March 31, 2024.

On February 28, 2020, T-Mobile and Sprint each received a Notice of Apparent Liability for Forfeiture and Admonishment from the FCC, which proposed a penalty for allegedly violating section 222 of the Communications Act and the FCC’s regulations governing the privacy of customer information.

On April 29, 2024, the FCC issued Forfeiture Orders against T-Mobile and Sprint that largely adopted the allegations and conclusions of the Notices of Apparent Liability and imposed penalties on T-Mobile and Sprint.

T-Mobile and Sprint paid those penalties under protest, and on June 27, 2024, T-Mobile and Sprint filed Petitions for Review challenging the FCC’s Forfeiture Orders in the United States Court of Appeals for the District of Columbia.

We are unable to predict the potential outcome of those proceedings.

On April 1, 2020, in connection with the closing of the Merger, we assumed the contingencies and litigation matters of Sprint.

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These matters include, among other things, certain ongoing FCC and state government agency investigations into Sprint’s Lifeline program.

In September 2019, Sprint notified the FCC that it had claimed monthly subsidies for serving subscribers, even though these subscribers may not have met usage requirements under Sprint's usage policy for the Lifeline program, due to an inadvertent coding issue in the system used to identify qualifying subscriber usage that occurred in July 2017 while the system was being updated.

In September 2019, Sprint notified the FCC that it had claimed monthly subsidies for serving

Index for Notes to the Condensed Consolidated Financial Statements

subscribers, even though these subscribers may not have met usage requirements under Sprint's usage policy for the Lifeline program, due to an inadvertent coding issue in the system used to identify qualifying subscriber usage that occurred in July 2017 while the system was being updated.

Sprint has made a number of payments to reimburse the federal government and certain states for excess subsidy payments.

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Under the terms of the settlement, we would pay an aggregate of $ 350 million to fund claims submitted by class members, the legal fees of plaintiffs’ counsel and the costs of administering the settlement.

We also committed to an aggregate incremental spend of $ 150 million for data security and related technology in

Index for Notes to the Condensed Consolidated Financial Statements

2022 and 2023.

We also committed to an aggregate incremental spend of $ 150 million for data security and related technology in 2022 and 2023.

We previously paid $ 35 million for claims administration purposes.

On July 31, 2023, a class member filed an appeal to the final approval order challenging the Court’s award of attorneys’ fees to class counsel.

We expect the remaining portion of the $ 350 million settlement payment to fund claims to be made once that appeal is resolved.

On July 29, 2024, the Court of Appeals ruled in favor of appellant and sent the case back to the trial court for further proceedings to resolve plaintiffs’ counsel’s fee request.

We expect the remaining portion of the $ 350 million settlement payment to fund claims to be made once that issue is resolved.

We anticipate that, upon exhaustion of any appeals, the settlement will provide a full release of all claims arising out of the August 2021 cyberattack by class members who do not opt out, against all defendants, including us, our subsidiaries and affiliates, and our directors and officers.

3 unchanged sentences

In connection with the proposed class action settlement and the separate settlements, we recorded a total pre-tax charge of approximately $ 400 million in the second quarter of 2022.

During the three months ended March 31, 2023, we recognized $ 50 million in reimbursements from insurance carriers for costs incurred related to the August 2021 cyberattack, which is included as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

During the six months ended June 30, 2023, we recognized $ 50 million in reimbursements from insurance carriers for costs incurred related to the August 2021 cyberattack, which is included as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

The ultimate resolution of the class action depends on the number of plaintiffs who opt out of the proposed settlement and whether the proposed settlement will be appealed.

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Sievert et al., Case No.

2022-0819-SG, against our current directors and certain of our former directors, alleging claims for breach of fiduciary duty relating to the Company’s cybersecurity practices.

2022-0819-SG, against our current directors and certain of our former

Index for Notes to the Condensed Consolidated Financial Statements

directors, alleging claims for breach of fiduciary duty relating to the Company’s cybersecurity practices.

We are also named as a nominal defendant in the lawsuit.

On May 31, 2024, the court issued an opinion dismissing the plaintiff’s complaint in its entirety.

Such judgement has since been appealed.

We are unable at this time to predict the potential outcome of this lawsuit or whether we may be subject to further private litigation.

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retail cell service market.

Plaintiffs seek injunctive relief and trebled monetary damages on behalf of a purported class of AT&T and Verizon customers who plaintiffs allege paid artificially inflated prices due to the Merger.

Plaintiffs seek injunctive relief and trebled monetary damages on behalf of a purported class of AT&T and Verizon customers whom plaintiffs allege paid artificially inflated prices due to the Merger.

We are vigorously defending this lawsuit, but we are unable to predict the potential outcome.

7 unchanged sentences

In addition, we are unable to predict the full impact of this incident on customer behavior in the future, including whether a change in our customers’ behavior could negatively impact our results of operations on an ongoing basis, although we presently do not expect that it will have a material effect on our operations.

Index for Notes to the Condensed Consolidated Financial Statements

Note 14 – Additional Financial Information

1 unchanged sentence

Accounts payable and accrued liabilities are summarized as follows:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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Accounts payable and accrued liabilities $ 7,591 $ 10,373

Book overdrafts included in accounts payable were $ 702 million and $ 740 million as of March 31, 2024, and December 31, 2023, respectively.

Book overdrafts included in accounts payable were $ 364 million and $ 740 million as of June 30, 2024, and December 31, 2023, respectively.

Index for Notes to the Condensed Consolidated Financial Statements

Supplemental Condensed Consolidated Statements of Cash Flows Information

The following table summarizes T-Mobile’s supplemental cash flow information:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2024 2023 2024 2023

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Financing lease right-of-use assets obtained in exchange for lease obligations 311 324 574 563

Contingent and other deferred consideration related to the Ka’ena Acquisition 210 — 210 —

Cash and cash equivalents, including restricted cash

Cash and cash equivalents, including restricted cash, presented on our Condensed Consolidated Statements of Cash Flows were included on our Condensed Consolidated Balance Sheets as follows:

(in millions) March 31,

(in millions) June 30,

2024 December 31,

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Cash and cash equivalents, including restricted cash $ 6,647 $ 5,307

Note 14 – Subsequent Events

See Note 10 - Stockholder Return Program for additional information regarding the 2023-2024 Stockholder Return Program.

Subsequent to March 31, 2024, 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 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 fiber customers.

The funds invested by us will be used to fund future fiber builds.

In addition, we are expected to contribute an additional commitment of approximately $ 500 million between 2027 and 2028.

Subsequent to March 31, 2024, on April 25, 2024, we received all necessary regulatory approvals for the Ka’ena Acquisition, which is expected to close on May 1, 2024.

See Note 2 - Business Combination for more information.

Note 15 – Subsequent Event

Subsequent to June 30, 2024, on July 18, 2024, we entered into a definitive agreement with KKR to establish a joint venture to acquire Metronet.

See Note 3 – Joint Ventures for additional information.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements