What changed in this filing

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Item 1. Financial Statements

2024-10-23 compared with 2024-07-31 · 198 added, 155 removed, 798 unchanged (31% of the section changed)

2 unchanged sentences

Condensed Consolidated Balance Sheets

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

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

2024 December 31,

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Condensed Consolidated Statements of Comprehensive Income

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

Three Months Ended September 30, Nine Months Ended September 30,

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

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Selling, general and administrative 5,186 5,334 15,466 16,031

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

Gain on disposal group held for sale — — — ( 25 )

Depreciation and amortization 3,151 3,187 9,770 9,500

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Interest expense, net ( 836 ) ( 790 ) ( 2,570 ) ( 2,486 )

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

Other income, net 7 41 19 56

Total other expense, net ( 829 ) ( 749 ) ( 2,551 ) ( 2,430 )

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Reclassification of loss from cash flow hedges, net of tax effect of $ 15 , $ 15 , $ 45 and $ 42

44 41 130 121

Net unrealized loss on fair value hedges, net of tax effect of $( 5 ), $ 0 , $( 15 ) and $ 0

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Condensed Consolidated Statements of Cash Flows

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

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

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Other, net ( 49 ) ( 24 ) ( 117 ) ( 113 )

Net cash used in financing activities ( 4,134 ) ( 784 ) ( 5,800 ) ( 3,057 )

Net cash provided by (used in) financing activities 507 ( 5,510 ) ( 5,293 ) ( 8,567 )

Change in cash and cash equivalents, including restricted cash and cash held for sale 3,339 ( 1,609 ) 4,679 525

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(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 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

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

Net income — — — — — 3,059 3,059

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Stock-based compensation — — — 151 — — 151

Stock issued for employee stock purchase plan 569,160 — — 79 — — 79

Issuance of vested restricted stock units 594,078 — — — — — —

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Repurchases of common stock ( 3,179,707 ) 3,179,707 ( 650 ) — — — ( 650 )

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

Other, net 39,293 ( 811 ) ( 1 ) 2 — — 1

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 September 30, 2024 1,164,613,922 106,211,047 $ ( 15,921 ) $ 68,659 $ ( 889 ) $ 12,401 $ 64,250

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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Other, net 148,654 20,884 ( 5 ) 14 — — 9

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 September 30, 2024 1,164,613,922 106,211,047 $ ( 15,921 ) $ 68,659 $ ( 889 ) $ 12,401 $ 64,250

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

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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

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

Net income — — — — — 2,142 2,142

Dividends declared ($ 0.65 per share)

— — — — — ( 745 ) ( 745 )

Other comprehensive income — — — — 8 — 8

Stock-based compensation — — — 169 — — 169

Stock issued for employee stock purchase plan 708,049 — — 84 — — 84

Issuance of vested restricted stock units 231,246 — — — — — —

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Other, net 31,142 ( 7,641 ) 2 — — — 2

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 September 30, 2023 1,161,979,708 100,396,057 $ ( 14,092 ) $ 74,404 $ ( 949 ) $ 5,335 $ 64,698

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

Net income — — — — — 6,303 6,303

Dividends declared ($ 0.65 per share)

— — — — — ( 745 ) ( 745 )

Other comprehensive income — — — — 97 — 97

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Other, net 135,342 18,671 ( 3 ) 11 — — 8

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 September 30, 2023 1,161,979,708 100,396,057 $ ( 14,092 ) $ 74,404 $ ( 949 ) $ 5,335 $ 64,698

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

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Additional Financial Information

Subsequent Event

Subsequent Even ts

Index for Notes to the Condensed Consolidated Financial Statements

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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.

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

Derivative and Hedging Instruments

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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.

We are currently evaluating the impact this guidance will have on the disclosures included in the Notes to the Consolidated Financial Statements.

We plan to adopt the standard when it becomes effective for us beginning in our fiscal year 2024 annual financial statements, and we expect the adoption of the standard will impact certain of our segment reporting disclosures in the Notes to the Consolidated Financial Statements.

Income Tax Disclosures

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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.

On the Acquisition Date, this relationship was effectively terminated, and the Company acquired Ka’ena’s prepaid customer relationships and began to 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.

The financial results of Ka’ena from the Acquisition Date through September 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.

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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

The amount of the upfront payment is subject to customary adjustments and is expected to be finalized by the end of 2024.

Index for Notes to the Condensed Consolidated Financial Statements

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.

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• $ 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.

We will record expenses 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 T-Mobile common stock issued to Ka’ena stockholders related to the upfront payment $ 527

Fair value of cash paid to Ka’ena stockholders related to the upfront payment 413

Fair value of contingent consideration 183

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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.

As of September 30, 2024, $ 195 million of liabilities for contingent consideration and $ 55 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.

The identifiable assets acquired and liabilities assumed from 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.

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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.

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 and to 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.

Lumos and Metronet Joint Ventures

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 (“Lumos”), a fiber-to-the-home platform, from EQT’s predecessor fund, EQT Infrastructure III.

The Lumos joint acquisition is expected to close in 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.

In addition, pursuant to the merger agreement, we expect to make an additional capital contribution of approximately $ 500 million in 2027 or 2028 for the existing business plan.

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.

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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.

We do not anticipate making further capital contributions following the closing for the existing business plan.

Upon closing of the transactions, we expect to account for the Lumos and Metronet joint ventures under the equity method of accounting and recognize service revenues for the acquired Lumos and Metronet fiber customers and wholesale costs paid to the joint ventures for network access within Cost of services on our Condensed Consolidated Statements of Comprehensive Income.

Note 4 – Receivables and Related Allowance for Credit Losses

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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 11.3 % and 10.6 % as of June 30, 2024, and December 31, 2023, respectively.

EIP receivables had a combined weighted-average effective interest rate of 11.2 % and 10.6 % as of September 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) June 30,

(in millions) September 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 June 30, 2024:

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

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

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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 six months ended June 30, 2024:

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

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

(in millions) Originated in 2024 Originated in 2023 Originated prior to 2023 Total

Write-offs $ 101 $ 263 $ 63 $ 427

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

Activity for the nine months ended September 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:

September 30, 2024 September 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 June 30, 2024.

We do not have material off-balance-sheet credit exposures as of September 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 June 30, 2024, and December 31, 2023, the EIP Sale Arrangement provided funding of $ 1.3 billion.

As of both September 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) June 30,

(in millions) September 30,

2024 December 31,

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Overview of the Transaction

In 2014, we entered into an arrangement to sell certain service accounts receivable on a revolving basis (the “Service Receivable Sale Arrangement”).

In 2014, we entered into an arrangement to sell certain service accounts receivable on a revolving basis (the “Service Receivable Sale Arrangement”), which has been revised and extended from time to time.

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

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

As of both September 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) June 30,

(in millions) September 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) June 30,

(in millions) September 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 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.

As of September 30, 2024, and December 31, 2023, our deferred purchase price related to the sales of service accounts receivable and EIP receivables was $ 626 million and $ 658 million, respectively.

We recognized losses from sales of receivables, including changes in fair value of the deferred purchase price, of $ 23 million and $ 46 million for the three months ended September 30, 2024 and 2023, respectively, and $ 69 million and $ 135 million for the nine months ended September 30, 2024 and 2023, respectively, in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

Subsequent to September 30, 2024, on October 22, 2024, we executed an amendment to the EIP Sale Arrangement and an amendment to the Service Receivable Sale Arrangement (together, the “Pledge Amendments”).

Currently, the credit enhancement feature of each of the EIP Sale Arrangement and the Service Receivable Sale Arrangement consists of additional receivables sold in excess of the funding commitments and such additional receivables are represented by a deferred purchase price for each arrangement, consisting of a receivable from the purchasers that entitles us to certain collections on the receivables.

Index for Notes to the Condensed Consolidated Financial Statements

Pursuant to the Pledge Amendments, effective on November 1, 2024, the credit enhancement feature of each arrangement will instead consist of such additional receivables pledged to the purchasers instead of sold.

Following the effective date of the Pledge Amendments, all cash proceeds associated with the sale of such receivables, a portion of which is currently recognized as Proceeds related to beneficial interests in securitization transactions within Net cash used in investing activities on our Condensed Consolidated Statements of Cash Flows, will be recognized as operating cash flows.

In addition, the Pledge Amendment for the EIP Sale Arrangement also extends the scheduled expiry date of such arrangement to November 18, 2025.

Continuing Involvement

Pursuant to the sale arrangements described above, we have continuing involvement with the service accounts receivable and EIP receivables we sell as we service the receivables, are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where a write-off is imminent, and may be responsible for absorbing credit losses through reduced collections on our deferred purchase price assets.

Pursuant to the sale arrangements described above, we have continuing involvement with the service accounts receivables and EIP receivables we sell as we service the receivables, are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where a write-off is imminent, and may be responsible for absorbing credit losses through reduced collections on our deferred purchase price assets.

We continue to service the customers and their related receivables, including facilitating customer payment collection, in exchange for a monthly servicing fee.

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

Index for Notes to the Condensed Consolidated Financial Statements

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.

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.

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:

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

(in millions) Goodwill

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Preliminary goodwill from the Ka’ena Acquisition in 2024 781

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

Balance as of September 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:

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

(in millions) 2024

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Spectrum licenses, end of period $ 98,736

(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.

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.

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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 June 30, 2024.

The licenses are included in Spectrum licenses on our Condensed Consolidated Balance Sheets as of September 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.

During the three and nine months ended September 30, 2024, we recognized gains associated with the closing of certain spectrum exchange transactions of $ 10 million and $ 57 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 nine months ended September 30, 2023.

Index for Notes to the Condensed Consolidated Financial Statements

As of September 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.

Subsequent to September 30, 2024, on October 15, 2024, we closed on an agreement with a third party for the exchange of certain of our 39 GHz spectrum licenses for certain of their 24 GHz spectrum licenses.

We expect to record the spectrum licenses received at their estimated fair values of $ 985 million and recognize an associated gain of $ 137 million as a reduction to Selling, general and administrative expenses on our 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.

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).

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).

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

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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.

As such, we recognized a gain for the $ 100 million extension fee previously paid by DISH during the nine months ended September 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.

On October 1, 2024, we concluded the 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, 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.

We did not receive a qualifying bid and have been relieved of the obligation to sell the spectrum licenses.

We are currently exploring alternatives to sell or utilize the spectrum licenses.

Channel 51 License Co LLC and LB License Co, LLC

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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 first tranche closed on June 24, 2024, and the associated payment of $ 2.4 billion was made on August 5, 2024.

Index for Notes to the Condensed Consolidated Financial Statements

Subsequent to September 30, 2024, on October 22, 2024, the FCC approved the purchase of the Dallas licenses included in the second tranche.

We expect the closing on the Dallas licenses and the associated payment of $ 541 million to occur in December 2024.

We anticipate that the closing on the remaining deferred licenses in the second tranche will occur in 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.

N77 License Co LLC

On September 10, 2024, we entered into a license purchase agreement with N77 License Co LLC (“Buyer”), pursuant to which Buyer has the option to purchase all or a portion of our remaining 3.45 GHz spectrum licenses in exchange for a range of cash consideration, with the specific licenses sold to be determined based upon the amount of committed financing raised by Buyer.

As of September 30, 2024, and December 31, 2023, the licenses subject to the license purchase agreement were held at cost of $ 2.7 billion in Spectrum licenses on our Condensed Consolidated Balance Sheets.

We maintain the right to terminate the license purchase agreement no later than February 7, 2025, after our receipt of written notice of committed financing as of December 9, 2024, if the Buyer’s committed financing is less than a certain target level of cash consideration.

The transaction is subject to FCC approval.

We do not expect the transaction to have a material impact on our Condensed Consolidated Statements of Comprehensive Income.

Other Intangible Assets

The components of Other intangible assets were as follows:

Useful Lives June 30, 2024 December 31, 2023

Useful Lives September 30, 2024 December 31, 2023

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

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(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.

See Note 2 - Business Combinations for more information.

Amortization expense for intangible assets subject to amortization was $ 221 million and $ 209 million for the three months ended September 30, 2024 and 2023, respectively, and $ 637 million and $ 678 million for the nine months ended September 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,

Twelve Months Ending September 30,

Thereafter 408

Total $ 2,762

Index for Notes to the Condensed Consolidated Financial Statements

Note 7 – Fair Value Measurements

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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.

Accordingly, all changes in the fair value of the 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 offsetting swap amounts, are recorded within Other 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.

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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.

During the three and nine months ended September 30, 2024, we recognized pre-tax gains of $ 68 million and $ 21 million, respectively, in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets related to the fair value changes of these swaps.

During the three and nine months ended September 30, 2024, $ 84 million and $ 77 million, respectively, of the amount recognized in Accumulated other comprehensive loss was reclassified to Other income, net, on our Condensed Consolidated Statements of Comprehensive Income to exactly offset the related pre-tax foreign currency transaction loss on the underlying EUR-denominated debt.

Index for Notes to the Condensed Consolidated Financial Statements

Interest Rate Lock Derivatives

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.

Aggregate changes in the fair value of our interest rate lock derivatives, which were terminated in April 2020, of $ 1.0 billion and $ 1.1 billion are presented in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets as of September 30, 2024, and December 31, 2023, respectively.

During the three months ended September 30, 2024 and 2023, $ 59 million and $ 55 million, respectively, and during the nine months ended September 30, 2024 and 2023, $ 175 million and $ 163 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 $ 250 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense, net, over the 12 months ending September 30, 2025.

Deferred Purchase Price Assets

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

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.

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 $ 626 million and $ 658 million as of September 30, 2024, and December 31, 2023, respectively.

The fair values of our Senior Notes and spectrum-backed Senior Secured Notes to third parties were 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.

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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 third parties (EUR-denominated), Senior Notes to affiliates and ABS Notes.

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

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

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

Carrying Amount Fair Value Carrying Amount Fair Value

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ABS Notes to third parties 2 1,247 1,258 748 748

Index for Notes to the Condensed Consolidated Financial Statements

Note 8 – Debt

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

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

(in millions) December 31,

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Note Redemptions Repayments Reclassifications (1)

September 30,

Short-term debt $ 3,619 $ — $ ( 2,500 ) $ ( 669 ) $ 5,458 $ ( 57 ) $ 5,851

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(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.

Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.0 % and 4.0 % on weighted-average debt outstanding of $ 78.1 billion and $ 77.2 billion for the three months ended September 30, 2024 and 2023, respectively, and 4.1 % and 4.0 % on weighted-average debt outstanding of $ 78.1 billion and $ 75.5 billion for the nine months ended September 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.

Issuances and Borrowings

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

During the nine months ended September 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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699 ( 7 ) 692 May 8, 2024

4.200 % Senior Notes due 2029

700 ( 4 ) 696 September 26, 2024

4.700 % Senior Notes due 2035

900 ( 6 ) 894 September 26, 2024

5.250 % Senior Notes due 2055

900 ( 10 ) 890 September 26, 2024

Total of Senior Notes issued $ 7,650 $ ( 58 ) $ 7,592

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

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:

During the nine months ended September 30, 2024, we made the following redemption and repayments:

(in millions) Principal Amount Payment Date

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Total Repayments $ 669

Subsequent to September 30, 2024, on October 11, 2024, we delivered notice of redemption on $ 1.5 billion aggregate principal amount of our 7.625 % Senior Notes due 2025.

We will redeem the notes at par on November 15, 2024.

Index for Notes to the Condensed Consolidated Financial Statements

Asset-backed Notes

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These ABS Notes are secured by $ 658 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 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.

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 nine months ended September 30, 2024.

As of September 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 June 30, 2024, were as follows:

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

(in millions) Expected Maturities

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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) June 30,

(in millions) September 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

Subsequent to September 30, 2024, on October 9, 2024, we issued $ 500 million of 4.250 % Class A Senior ABS Notes to third parties in a private placement transaction for net proceeds of approximately $ 498 million.

These ABS Notes are secured by $ 668 million of gross EIP receivables and future collections on such receivables.

The expected maturities of these ABS notes are $ 136 million due 2026 and $ 364 million due 2027.

Restricted Cash

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See Note 14 – Additional Financial Information for our reconciliation of Cash and cash equivalents, including restricted cash.

Index for Notes to the Condensed Consolidated Financial Statements

Note 9 – Tower Obligations

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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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As a result of the Crown Agreement, there was an increase in our financing obligation as of the effective date of the Crown Agreement of approximately $ 1.2 billion, with a corresponding decrease to Other long-term liabilities associated with unfavorable contract terms.

The modification resulted in a revised interest rate under the effective interest method for the tower obligations:

The modification resulted in a revised

Index for Notes to the Condensed Consolidated Financial Statements

interest rate under the effective interest method for the tower obligations:

11.6 % for the Existing CCI Tower Lease Arrangements and 5.3 % for the Acquired CCI Tower Lease Arrangements.

1 unchanged sentence

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

(in millions) June 30,

(in millions) September 30,

2024 December 31,

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Other long-term liabilities 554 554

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.

Future minimum payments related to the tower obligations are approximately $ 394 million for the 12-month period ending September 30, 2025, $ 783 million in total for both of the 12-month periods ending September 30, 2026 and 2027, $ 829 million in total for both of the 12-month periods ending September 30, 2028 and 2029, and $ 3.8 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 $ 245 million in our Operating lease liabilities as of June 30, 2024.

Under the arrangement, we remain primarily liable for ground lease payments on approximately 900 sites and have included lease liabilities of $ 247 million in our Operating lease liabilities as of September 30, 2024.

Note 10 – Revenue from Contracts with Customers

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

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

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

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Contract Balances

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

The contract asset and contract liability balances from contracts with customers as of September 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 June 30, 2024 544 1,091

Balance as of September 30, 2024 608 1,121

Change $ 1 $ 309

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 $ 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.

The current portion of our contract assets of $ 431 million and $ 495 million as of September 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.

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

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,

Revenues for the three and nine months ended September 30, 2024 and 2023 include the following:

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Remaining Performance Obligations

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.

As of September 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 $ 1.2 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 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.

As of September 30, 2024, the aggregate amount of the contractual minimum consideration for wholesale, roaming and service contracts is $ 229 million, $ 1.4 billion and $ 3.1 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 $ 2.0 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.

The balance of deferred incremental costs to obtain contracts with customers was $ 2.0 billion and $ 2.1 billion for September 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 $ 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.

Amortization of deferred contract costs included in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income were $ 490 million and $ 468 million for the three months ended September 30, 2024 and 2023, respectively, and $ 1.5 billion and $ 1.3 billion for the nine months ended September 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 and six months ended June 30, 2024 and 2023.

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

Index for Notes to the Condensed Consolidated Financial Statements

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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.

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 was paid on September 12, 2024, to stockholders of record as of the close of business on August 30, 2024.

On September 18, 2024, our Board of Directors declared a cash dividend of $ 0.88 per share on our issued and outstanding common stock, which will be paid on December 12, 2024, to stockholders of record as of the close of business on November 27, 2024.

During the three and nine months ended September 30, 2024, we paid an aggregate of $ 758 million and $ 2.3 billion, respectively, in cash dividends to our stockholders, which was presented within Net cash provided by (used in) financing activities on our Condensed Consolidated Statements of Cash Flows, of which during the three and nine months ended September 30, 2024, $ 382 million and $ 1.2 billion, respectively, was paid to DT.

As of September 30, 2024, $ 1.0 billion for dividends payable is presented within Other current liabilities on our Condensed Consolidated Balance Sheets, of which $ 518 million is payable to DT.

During the three months ended September 30, 2024, we repurchased 3,179,707 shares of our common stock at an average price per share of $ 202.45 for a total purchase price of $ 644 million, and during the nine months ended September 30, 2024, we repurchased 39,093,340 shares of our common stock at an average price per share of $ 165.98 for a total purchase price of $ 6.5 billion, under the 2023-2024 Stockholder Return Program.

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

As of September 30, 2024, we had up to $ 7.3 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024.

Subsequent to September 30, 2024, from October 1, 2024, through October 18, 2024, we repurchased 4,186,019 shares of our common stock at an average price per share of $ 212.88 for a total purchase price of $ 891 million.

As of October 18, 2024, we had up to $ 6.4 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

Note 12 – Earnings Per Share

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

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

Three Months Ended September 30, Nine Months Ended September 30,

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

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

(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.

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

As of September 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 September 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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We are involved in various lawsuits and disputes, claims, government agency investigations and enforcement actions, and other proceedings (“Litigation and Regulatory Matters”) that arise in the ordinary course of business, which include claims of patent infringement (most of which are asserted by non-practicing entities primarily seeking monetary damages), class actions, and proceedings to enforce FCC or other government agency rules and regulations.

Those Litigation and Regulatory Matters are at various stages, and some of them may proceed to trial, arbitration, hearing, or other adjudication that could result in fines, penalties, or awards of monetary or injunctive relief in the coming 12 months if they are not otherwise resolved.

Those Litigation and Regulatory Matters are at various stages, and some of them may proceed to trial, arbitration, hearing, or other adjudication that could result in fines,

Index for Notes to the Condensed Consolidated Financial Statements

penalties, or awards of monetary or injunctive relief in the coming 12 months if they are not otherwise resolved.

We have established an accrual with respect to certain of these matters, where appropriate.

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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

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.

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.

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

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Our forensic investigation is complete, and we believe we have a full view of the data compromised.

Index for Notes to the Condensed Consolidated Financial Statements

As a result of the August 2021 cyberattack, we have become subject to numerous lawsuits, including mass arbitration claims and multiple class action lawsuits that have been filed in numerous jurisdictions seeking, among other things, unspecified monetary damages, costs and attorneys’ fees arising out of the August 2021 cyberattack.

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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.

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.

Two class members appealed the final approval order challenging the Court’s award of attorneys’ fees to class counsel.

On July 29, 2024, the Court of Appeals ruled in favor of one of the appellants 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 be made in November 2024.

We also anticipate that 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.

The settlement contains no admission of liability, wrongdoing or responsibility by any of the defendants.

2 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 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.

During the nine months ended September 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.

In addition, in September 2022, a purported Company shareholder filed a derivative action in the Delaware Chancery Court under the caption Harper v.

In addition, in September 2022, a purported Company shareholder filed a derivative action in the Delaware Court of Chancery under the caption Harper v.

Sievert et al., Case No.

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.

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.

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.

The plaintiff has appealed that decision.

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

We have also received inquiries from various government agencies, law enforcement and other governmental authorities related to the August 2021 cyberattack, which could result in substantial fines or penalties.

We are cooperating fully with these agencies and regulators and working with them to resolve these matters.

We reached an agreement with the FCC, which was announced on September 30, 2024, to resolve one of those inquiries.

We will continue to cooperate fully with the other agencies and regulators inquiring about the matter with an aim to resolve all of these matters.

While we hope to resolve them in the near term, we cannot predict the timing or outcome of any of these matters or whether we may be subject to further regulatory inquiries, investigations, or enforcement actions.

8 unchanged sentences

On January 5, 2023, we identified that a bad actor was obtaining data through a single Application Programming Interface (“API”) without authorization.

Based on our investigation, the impacted API is only able to provide a limited set of customer account data, including name, billing address, email, phone number, date of birth, T-Mobile account number and information, such as the number of lines on the account and plan features.

Based on our investigation, the impacted API is only able to provide a limited set of customer

Index for Notes to the Condensed Consolidated Financial Statements

account data, including name, billing address, email, phone number, date of birth, T-Mobile account number and information, such as the number of lines on the account and plan features.

The result from our investigation indicates that the bad actor(s) obtained data from this API for approximately 37 million current postpaid and prepaid customer accounts, though many of these accounts did not include the full data set.

7 unchanged sentences

Accounts payable and accrued liabilities are summarized as follows:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

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Accounts payable and accrued liabilities $ 7,496 $ 10,373

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

Book overdrafts included in accounts payable were $ 405 million and $ 740 million as of September 30, 2024, and December 31, 2023, respectively.

Supplemental Condensed Consolidated Statements of Cash Flows Information

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

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

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

8 unchanged sentences

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

Index for Notes to the Condensed Consolidated Financial Statements

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) June 30,

(in millions) September 30,

2024 December 31,

3 unchanged sentences

Cash and cash equivalents, including restricted cash $ 9,986 $ 5,307

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.

Note 15 – Subsequent Events

Subsequent to September 30, 2024, on October 9, 2024, we issued $ 500 million of 4.250 % Class A Senior ABS Notes to third parties in a private placement transaction.

See Note 8 - Debt for additional information.

Subsequent to September 30, 2024, on October 11, 2024, we delivered notice of redemption on $ 1.5 billion aggregate principal amount of our 7.625 % Senior Notes due 2025.

We will redeem the notes at par on November 15, 2024.

Subsequent to September 30, 2024, on October 15, 2024, we closed on an agreement with a third party for the exchange of certain 39 GHz spectrum licenses.

See Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets for additional information.

See Note 11 - Stockholder Return Program for additional information.

Subsequent to September 30, 2024, on October 22, 2024, we executed the Pledge Amendments to the EIP Sale Arrangement and the Service Receivable Sale Arrangement.

See Note 5 - Sales of Certain Receivables for additional information.

Subsequent to September 30, 2024, on October 22, 2024, the FCC approved our purchase of certain 600 MHz licenses in the second tranche of our Amended and Restated License Purchase Agreements with Channel 51 License Co LLC and LB License Co, LLC.

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