What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-04-24 compared with 2024-10-23 · 252 added, 391 removed, 344 unchanged (65% of the section changed)

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• criminal cyberattacks, disruption, data loss or other security breaches;

• our inability to take advantage of technological developments on a timely basis;

• our inability to timely adopt and effectively deploy network technology developments;

• our inability to effectively execute our digital transformation and drive customer and employee adoption of emerging technologies;

• our inability to retain or motivate key personnel, hire qualified personnel or maintain our corporate culture;

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• the scarcity and cost of additional wireless spectrum, and regulations relating to spectrum use;

• challenges in modernizing our existing applications and systems;

• the impacts of the actions we have taken and conditions we have agreed to in connection with the regulatory proceedings and approvals of our merger (the “Merger”) with Sprint Corporation (“Sprint”) pursuant to a Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”), including the acquisition by DISH Network Corporation (“DISH”) of the prepaid wireless business operated under the Boost Mobile and Sprint prepaid brands (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Personal Communications Company LLC and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets, and the assumption of certain related liabilities (collectively, the “Prepaid Transaction”), the complaint and proposed final judgment (the “Final Judgment”) agreed to by us, Deutsche Telekom AG (“DT”), Sprint, SoftBank Group Corp.

(“SoftBank”) and DISH with the U.S.

District Court for the District of Columbia, which was approved by the Court on April 1, 2020, as amended on October 23, 2023, the proposed commitments filed with the Secretary of the Federal Communications Commission (“FCC”), which we announced on May 20, 2019, certain national security commitments and undertakings, and any other commitments or undertakings entered into, including, but not limited to, those we have made to certain states and nongovernmental organizations (collectively, the “Government Commitments”), and the challenges in satisfying the Government Commitments in the required time frames and the significant cumulative costs incurred in tracking and monitoring compliance over multiple years;

• the timing and effects of any pending and future acquisition, divestiture, investment, joint venture or merger involving us, including our inability to obtain any required regulatory approval necessary to consummate any such transactions or to achieve the expected benefits of such transactions;

• adverse economic, political or market conditions in the U.S.

and international markets, including changes resulting from increases in inflation or interest rates, supply chain disruptions and impacts of geopolitical instability, such as the Ukraine-Russia and Israel-Hamas wars and further escalations thereof;

• sociopolitical volatility and polarization;

• our inability to manage the ongoing arrangements entered into in connection with the Prepaid Transaction, and known or unknown liabilities arising in connection therewith;

• the timing and effects of any future acquisition, divestiture, investment, joint venture or merger involving us, including our inability to obtain any required regulatory approval necessary to consummate any such transactions or to achieve the expected benefits of such transactions;

and international markets, including changes resulting from increases in inflation or interest rates, tariffs and trade restrictions, supply chain disruptions, fluctuations in global currencies, immigration policies, and impacts of geopolitical instability, such as the Ukraine-Russia and Israel-Hamas wars and further escalations thereof;

• potential operational delays, higher procurement and operational costs, and regulatory and compliance complexities as a result of changes to trade policies, including higher tariffs, restrictions and other economic disincentives to trade;

• our inability to successfully deliver new products and services;

• any disruption or failure of our third parties (including key suppliers) to provide products or services for the operation of our business;

• sociopolitical volatility and polarization and risks related to environmental, social and governance matters;

• our substantial level of indebtedness and our inability to service our debt obligations in accordance with their terms;

• changes in the credit market conditions, credit rating downgrades or an inability to access debt markets;

• the risk of future material weaknesses we may identify or any other failure by us to maintain effective internal controls, and the resulting significant costs and reputational damage;

• our inability to maintain effective internal control over financial reporting;

• any changes in regulations or in the regulatory framework under which we operate;

• laws and regulations relating to the handling of privacy and data protection;

• laws and regulations relating to the handling of privacy, data protection and artificial intelligence;

• unfavorable outcomes of and increased costs from existing or future regulatory or legal proceedings;

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• our wireless licenses, including those controlled through leasing agreements, are subject to renewal and may be revoked;

• our exclusive forum provision as provided in our Fifth Amended and Restated Certificate of Incorporation;

• interests of DT, our controlling stockholder, which may differ from the interests of other stockholders;

• the dollar amount authorized for our 2023-2024 Stockholder Return Program (as defined in Note 11 – Stockholder Return Program of the Notes to the Condensed Consolidated Financial Statements) may not be fully utilized, and our share repurchases and dividend payments pursuant thereto may fail to have the desired impact on stockholder value;

• future sales of our common stock by DT and SoftBank and our inability to attract additional equity financing outside the United States due to foreign ownership limitations by the FCC.

• our exclusive forum provision as provided in our Certificate of Incorporation;

• interests of Deutsche Telekom AG (“DT”), our controlling stockholder, which may differ from the interests of other stockholders;

• our current and future stockholder return programs may not be fully utilized, and our share repurchases and dividend payments pursuant thereto may fail to have the desired impact on stockholder value;

• future sales of our common stock by DT and SoftBank Group Corp.

(“SoftBank”) and our inability to attract additional equity financing outside the United States due to foreign ownership limitations by the Federal Communications Commission (“FCC”).

Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

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Investors and others should note that we announce material information to our investors using our investor relations website (https://investor.t-mobile.com), newsroom website (https://t-mobile.com/news), press releases, SEC filings and public conference calls and webcasts.

We intend to also use certain social media accounts as means of disclosing information about us and our services and for complying with our disclosure obligations under Regulation FD (the @TMobileIR X account (https://x.com/TMobileIR), the @MikeSievert X account (https://x.com/MikeSievert), which Mr.

We intend to also use certain social media accounts as a means of disclosing information about us and our services and for complying with our disclosure obligations under Regulation FD (the @TMobileIR X account (https://x.com/TMobileIR), the @MikeSievert X account (https://x.com/MikeSievert) and our Chief Executive Officer’s LinkedIn account (https://www.linkedin.com/in/sievert), both of which Mr.

Sievert also uses as a means for personal communications and observations, and the @TMobileCFO X account (https://x.com/tmobilecfo) and our Chief Financial Officer’s LinkedIn account (https://www.linkedin.com/in/peter-osvaldik-3887394), both of which Mr.

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• Information that allows assessment of the likelihood that past performance is indicative of future performance.

Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements as of and for the three and nine months ended September 30, 2024, included in Part I, Item 1 of this Form 10-Q, and audited consolidated financial statements, included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023.

Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2025, included in Part I, Item 1 of this Form 10-Q, and audited consolidated financial statements, included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Except as expressly stated, the financial condition and results of operations discussed throughout our MD&A are those of T-Mobile US, Inc.

and its consolidated subsidiaries.

Merger-Related Costs

Merger-related costs associated with the Sprint Merger generally include:

• Integration costs to achieve efficiencies in network, retail, information technology and back office operations, migrate customers to the T-Mobile network and billing systems and the impact of legal matters assumed as part of the Merger;

• Restructuring costs, including severance, store rationalization and network decommissioning;

• Transaction costs, including legal and professional services related to the completion of the transactions.

Merger-related costs have been excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA, which are non-GAAP financial measures, as we do not consider these costs to be reflective of our ongoing operating performance.

Sprint Merger-Related Costs

As of June 30, 2024, we have incurred substantially all restructuring and integration costs associated with our merger (the “Sprint Merger”) with Sprint Corporation (“Sprint”) and, accordingly, no longer separately disclose Sprint Merger-related costs.

The cash payments for the Sprint Merger-related costs incurred extend beyond 2025 and primarily relate to operating leases for which we have recognized accelerated lease expense.

Sprint Merger-related costs were excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA for the three months ended March 31, 2024, which are non-GAAP financial measures, as we do not consider these costs to be reflective of our ongoing operating performance.

See “Adjusted EBITDA and Core Adjusted EBITDA” in the “ Performance Measures ” section of this MD&A.

Net cash payments for Merger-related costs, including payments related to our restructuring plan, are included in Net cash provided by operating activities on our Condensed Consolidated Statements of Cash Flows.

During the nine months ended September 30, 2024, we recognized a gain for the $100 million extension fee previously paid by DISH associated with the DISH License Purchase Agreement as a reduction to Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

The gain was presented as a reduction in Merger-related costs and excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA.

See Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements for more information.

As of June 30, 2024, we have incurred substantially all restructuring and integration costs associated with the Sprint Merger and, accordingly, no longer separately disclose Merger-related costs.

The cash payments for the Merger-related costs incurred extend beyond 2024.

Cash payments extending beyond 2024 primarily relate to operating and financing leases for which we have recognized accelerated lease expense.

Merger-related costs are presented below:

(in millions) Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

2024 2023 $ % 2024 2023 $ %

Merger-related costs

Cost of services, exclusive of depreciation and amortization $ — $ 120 $ (120) (100) % $ 180 $ 506 $ (326) (64) %

Cost of equipment sales, exclusive of depreciation and amortization — (3) 3 (100) % — (12) 12 (100) %

Selling, general and administrative — 35 (35) (100) % (59) 292 (351) (120) %

Total Merger-related costs $ — $ 152 $ (152) (100) % $ 121 $ 786 $ (665) (85) %

Net cash payments for Merger-related costs $ 124 $ 345 $ (221) (64) % $ 658 $ 1,557 $ (899) (58) %

Net cash payments for Sprint Merger-related costs, including payments related to our restructuring plan, are included in Net cash provided by operating activities on our Condensed Consolidated Statements of Cash Flows and our calculation of Adjusted Free Cash Flow and were $61 million and $293 million for the three months ended March 31, 2025 and 2024, respectively.

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.

On April 24, 2024, we entered into a definitive agreement with a fund operated by EQT, Infrastructure VI fund (“Fund VI”), to establish a joint venture between us and Fund VI to acquire Lumos (“Lumos”), a fiber-to-the-home platform, from EQT’s predecessor fund, EQT Infrastructure III.

Subsequent to March 31, 2025, on April 1, 2025, we completed the joint acquisition of Lumos, upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals.

At closing, we invested $926 million to acquire a 50% equity interest in the joint venture and fiber customers.

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

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

In addition, pursuant to the definitive agreement, we expect to make an additional capital contribution of approximately $500 million in 2027 or 2028 under 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.

This arrangement is expected to close in 2025, subject to customary closing conditions and regulatory approvals.

At closing, we expect to invest approximately $4.9 billion in the joint venture to acquire a 50% equity interest and all existing residential fiber customers, as well as funding the joint venture.

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

This arrangement is expected to close in mid-2025, subject to customary closing conditions and regulatory approvals.

At closing, we expect to invest approximately $4.9 billion to acquire a 50% equity interest in the joint venture and all existing residential fiber customers, as well as funding of the joint venture.

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

The joint ventures will focus on market identification and selection, build plans, network engineering and design, network deployment, and customer installation, with us owning customer relationships and selling fiber service under the T-Mobile brand.

Upon 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.

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.

Acquisition of Ka’ena Corporation

On May 1, 2024 (the “Acquisition Date”), we completed the merger with Ka’ena Corporation and its subsidiaries, including, among others, Mint Mobile LLC (collectively, “Ka’ena”), and as a result, Ka’ena became a wholly owned subsidiary of T-Mobile (the “Ka’ena Acquisition”).

The total purchase price is variable, dependent upon specified performance indicators of Ka’ena, and consists of an upfront payment on the Acquisition Date and an earnout payable on August 1, 2026.

On the Acquisition Date and in satisfaction of the upfront payment, we transferred $420 million in cash and 3,264,952 shares of T-Mobile common stock valued at $536 million as determined based on its closing market price on April 30, 2024, for a total payment fair value of $956 million.

A portion of the upfront payments made on the Acquisition Date was for the settlement of the preexisting wholesale relationship with Ka’ena.

Based on the amount paid upfront, up to an additional $403 million in future cash and T-Mobile common stock is payable in satisfaction of the earnout, dependent upon Ka’ena’s achievement of specified performance indicators.

On May 1, 2024 (the “Ka’ena Acquisition Date”), we completed the merger with Ka’ena Corporation and its subsidiaries, including, among others, Mint Mobile LLC (collectively, “Ka’ena”), and as a result, Ka’ena became a wholly owned subsidiary of T-Mobile (the “Ka’ena Acquisition”).

The total purchase price is variable, dependent upon specified performance indicators of Ka’ena, and consists of an upfront payment on the Ka’ena Acquisition Date and an earnout payable on August 1, 2026.

On the Ka’ena Acquisition Date and in satisfaction of the upfront payment, we transferred $420 million in cash and 3,264,952 shares of T-Mobile common stock valued at $536 million as determined based on its closing market price on April 30, 2024, for a total payment fair value of $956 million.

A portion of the upfront payment made on the Ka’ena Acquisition Date was for the settlement of the preexisting wholesale relationship with Ka’ena.

The amount of the upfront payment was subject to customary adjustments, and as a result of such adjustments, $17 million of the upfront payment was returned to T-Mobile during the fourth quarter of 2024, which resulted in a commensurate increase in the maximum payable in satisfaction of the earnout.

Based on the adjusted amount paid upfront, up to an additional $420 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.

Prior to the Ka’ena Acquisition, Ka’ena was a wholesale partner of the Company for which we recognized service revenues within Wholesale and other service revenues.

Upon the closing of the Ka’ena Acquisition, this relationship was effectively terminated, and the Company acquired Ka’ena’s prepaid customer relationships and 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.

For more information regarding the Ka’ena Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

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.

Acquisition of 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 certain UScellular debtholders prior to closing (the “UScellular Merger”).

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.

Upon closing of the transaction, we expect to account for the UScellular transaction as a business combination and to

consolidate the acquired operations.

We expect this transaction will yield approximately $1.0 billion in total annual run rate cost synergies, including operating expense and capital expenditure synergies, upon integration, with total cost to achieve the integration currently estimated at between $2.2 billion to $2.6 billion.

For more information regarding our acquisition of UScellular’s wireless operations, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Acquisition of Vistar Media Inc.

On December 20, 2024, we entered into an agreement and plan of merger for the acquisition of 100% of the outstanding capital stock of Vistar Media Inc.

(“Vistar”), a provider of technology solutions for digital-out-of-home advertisements (the “Vistar Acquisition”).

Upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals, on February 3, 2025 (the “Vistar Acquisition Date”), we completed the Vistar Acquisition, and as a result, Vistar became a wholly owned subsidiary of T-Mobile.

In exchange, T-Mobile transferred cash of $621 million.

For more information regarding the Vistar Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Acquisition of Blis Holdco Limited

On February 18, 2025, we entered into a share purchase agreement for the acquisition of 100% of the outstanding capital stock of Blis Holdco Limited (“Blis”), a provider of advertising solutions (the “Blis Acquisition”).

Upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals, on March 3, 2025 (the “Blis Acquisition Date”), we completed the Blis Acquisition, and as a result, Blis became a wholly owned subsidiary of T-Mobile.

In exchange, T-Mobile transferred cash of $180 million.

For more information regarding the Blis Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Results of Operations

Set forth below is a summary of our consolidated financial results:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

Three Months Ended March 31, Change

(in millions) 2025 2024 $ %

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Selling, general and administrative 5,488 5,138 350 7 %

Gain on disposal group held for sale — — — NM — (25) 25 (100) %

Depreciation and amortization 3,198 3,371 (173) (5) %

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Interest expense, net (916) (880) (36) 4 %

Other income, net 7 41 (34) (83) % 19 56 (37) (66) %

Other (expense) income, net (46) 20 (66) (330) %

Total other expense, net (962) (860) (102) 12 %

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Adjusted Free Cash Flow 4,396 3,347 1,049 31 %

NM - Not meaningful

The following discussion and analysis is for the three and nine months ended September 30, 2024, compared to the same periods in 2023, unless otherwise stated.

Total revenues increased $910 million, or 5%, for the three months ended and increased $1.4 billion, or 2%, for the nine months ended September 30, 2024.

The following discussion and analysis is for the three months ended March 31, 2025, compared to the same period in 2024, unless otherwise stated.

Total revenues increased $1.3 billion, or 7%.

The components of these changes are discussed below.

Postpaid revenues increased $1.0 billion, or 8%, for the three months ended and increased $2.6 billion, or 7%, for the nine months ended September 30, 2024.

The increase for the three months ended September 30, 2024, was primarily from:

Postpaid revenues increased $963 million, or 8%, primarily from:

• Higher postpaid ARPA.

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• Higher average postpaid accounts.

The increase for the nine months ended September 30, 2024, was primarily from:

• Higher average postpaid accounts;

• Higher postpaid ARPA.

See “Postpaid ARPA” in the “ Performance Measures ” section of this MD&A.

Prepaid revenues increased $243 million, or 10%, for the three months ended and increased $377 million, or 5%, for the nine months ended September 30, 2024, primarily from:

Prepaid revenues increased $240 million, or 10%, primarily from:

• Higher average prepaid customers, primarily from the prepaid customers acquired through the Ka’ena Acquisition;

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See “Prepaid ARPU” in the “ Performance Measures ” section of this MD&A.

Wholesale and other service revenues decreased $452 million, or 39%, for the three months ended and decreased $943 million, or 26%, for the nine months ended September 30, 2024.

The decrease for the three months ended September 30, 2024, was primarily from:

• Lower MVNO revenues, including the impact from the Ka’ena Acquisition, and lower DISH and TracFone MVNO revenue;

• Lower Affordable Connectivity Program and Lifeline revenues.

The decrease for the nine months ended September 30, 2024, was primarily from:

• Lower MVNO revenues, including the impact from the Ka’ena Acquisition, and lower DISH and TracFone MVNO revenue;

• Lower Affordable Connectivity Program and Lifeline revenues;

• Lower Wireline revenues due to the sale of the Wireline Business on May 1, 2023.

Equipment revenues increased $131 million, or 4%, for the three months ended and decreased $400 million, or 4%, for the nine months ended September 30, 2024.

The increase for the three months ended September 30, 2024, was primarily from:

• An increase of $92 million in device sales revenue, excluding purchased leased devices, primarily from:

• Higher average revenue per device sold, net of promotions, primarily driven by an increase in the high-end phone mix;

partially offset by

• A net decrease in the total number of devices sold, driven by lower Assurance Wireless and prepaid devices, partially offset by higher postpaid devices;

• An increase of $63 million in liquidation revenue, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.

The decrease for the nine months ended September 30, 2024, was primarily from:

• A decrease of $552 million in device sales revenue, excluding purchased leased devices, primarily from:

• A net decrease in the total number of devices sold, driven by lower prepaid and Assurance Wireless devices, partially offset by higher postpaid devices;

partially offset by

• Higher average revenue per device sold, net of promotions, primarily driven by an increase in the high-end phone mix;

• A decrease of $187 million in lease revenues, primarily due to a lower number of customer devices under lease as a result of the continued strategic shift in device financing from leasing to EIP;

partially offset by

• An increase of $412 million in liquidation revenue, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.

Other revenues decreased $32 million, or 12%, for the three months ended and decreased $204 million, or 22%, for the nine months ended September 30, 2024, primarily from the transition of certain device recovery programs from external sources to in-house processing, resulting in a change in presentation from Other revenues to Equipment revenues.

Total operating expenses decreased $290 million, or 2%, for the three months ended and decreased $1.2 billion, or 3%, for the nine months ended September 30, 2024.

Wholesale and other service revenues decreased $374 million, or 35%, primarily from:

• Lower MVNO revenues, including the impact from the Ka’ena Acquisition and lower DISH and TracFone MVNO revenues;

• Lower Affordable Connectivity Program revenues.

Equipment revenues increased $453 million, or 14%, primarily from:

• An increase of $290 million in device sales revenue, primarily from higher average revenue per device sold, net of promotions, primarily driven by an increase in the high-end phone mix, including the impact of higher postpaid device upgrades and lower Assurance Wireless device sales;

• An increase of $190 million in liquidation revenue, primarily due to an increase in the high-end phone mix and a higher number of liquidated devices.

Other revenues were essentially flat.

Total operating expenses increased $490 million, or 3%.

The components of this change are discussed below.

Cost of services , exclusive of depreciation and amortization, decreased $164 million, or 6%, for the three months ended and decreased $789 million, or 9%, for the nine months ended September 30, 2024.

The decrease for the three months ended September 30, 2024, was primarily from:

• $140 million of severance and related costs associated with the August 2023 workforce reduction recognized in the prior year;

• $120 million in Merger-related costs related to network decommissioning and integration recognized in the prior year;

• Higher Merger synergies;

partially offset by

• Higher site costs related to the continued build-out of our nationwide 5G network.

The decrease for the nine months ended September 30, 2024, was primarily from:

• A decrease of $326 million in Merger-related costs related to network decommissioning and integration;

• Lower costs due to the sale of the Wireline Business on May 1, 2023;

• Lower employee costs, primarily due to reduced headcount;

• $140 million of severance and related costs associated with the August 2023 workforce reduction recognized in the prior year;

• Higher Merger synergies;

partially offset by

• Higher site costs related to the continued build-out of our nationwide 5G network.

Cost of equipment sales , exclusive of depreciation and amortization, increased $58 million, or 1%, for the three months ended and decreased $131 million, or 1%, for the nine months ended September 30, 2024.

The slight increase for the three months ended September 30, 2024, was primarily from:

• An increase of $50 million in liquidation costs, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing;

mostly offset by

• A decrease of $39 million in device cost of equipment sales, excluding purchased leased devices, primarily from:

• A net decrease in the total number of devices sold, driven by lower Assurance Wireless and prepaid devices, partially offset by higher postpaid devices;

mostly offset by

• Higher average cost per device sold, primarily driven by an increase in the high-end phone mix.

The slight decrease for the nine months ended September 30, 2024, was primarily from:

• A decrease of $394 million in device cost of equipment sales, excluding purchased leased devices, primarily from:

• A net decrease in the total number of devices sold, driven by lower prepaid and Assurance Wireless devices, partially offset by higher postpaid devices;

partially offset by

• Higher average cost per device sold, primarily driven by an increase in the high-end phone mix;

mostly offset by

• An increase of $305 million in liquidation costs, primarily due to a higher number of in-house liquidated devices, including the impact from the transition of certain device recovery programs from external sources to in-house processing.

Selling, general and administrative expenses decreased $148 million, or 3%, for the three months ended and decreased $565 million, or 4%, for the nine months ended September 30, 2024.

The decrease for the three months ended September 30, 2024, was primarily from:

• $331 million of severance and related costs associated with the August 2023 workforce reduction recognized in the prior year;

• Higher Merger synergies;

partially offset by

• Higher costs as a result of the Ka’ena Acquisition.

The decrease for the nine months ended September 30, 2024, was primarily from:

• A decrease of $351 million in Merger-related costs, including the $100 million gain recognized during the nine months ended September 30, 2024, for the extension fee previously paid by DISH associated with the DISH License Purchase Agreement;

• $331 million of severance and related costs associated with the August 2023 workforce reduction recognized in the prior year;

• Higher Merger synergies;

partially offset by

Cost of services , exclusive of depreciation and amortization, decreased $86 million, or 3%, primarily from $107 million in Sprint Merger-related costs related to network decommissioning and integration recognized in the prior year.

Cost of equipment sales , exclusive of depreciation and amortization, increased $399 million, or 9%, primarily from:

• An increase of $253 million in device cost of equipment sales, primarily from higher average cost per device sold, primarily driven by an increase in the high-end phone mix, including the impact of higher postpaid device upgrades and lower Assurance Wireless device sales;

• An increase of $132 million in liquidation costs, primarily due to an increase in the high-end phone mix and a higher number of liquidated devices.

Selling, general and administrative expenses increased $350 million, or 7%, primarily from:

• Higher payroll and benefit related expenses;

• Higher costs as a result of the Ka’ena Acquisition.

• Higher legal expenses, including the settlement associated with the FCC Notices of Apparent Liability (See Note 13 – Commitments and Contingencies of the Notes to the Condensed Consolidated Financial Statements).

Gain on disposal group held for sale was $25 million for the nine months ended September 30, 2023, related to the sale of the Wireline Business on May 1, 2023.

There was no gain or loss on disposal group held for sale for the three and nine months ended September 30, 2024, and the three months ended September 30, 2023.

Depreciation and amortization decreased slightly for the three months ended and increased $270 million, or 3%, for the nine months ended September 30, 2024.

The increase for the nine months ended September 30, 2024, was primarily from higher depreciation expense from the acceleration of certain technology assets in the first half of 2024 as we continue to modernize our network, technology systems and platforms and from the continued build-out of our nationwide 5G network.

Operating income , the components of which are discussed above, increased $1.2 billion, or 33%, for the three months ended and increased $2.6 billion, or 24%, for the nine months ended September 30, 2024.

Interest expense, net increased slightly.

Other income, net was insignificant for both periods.

Income before income taxes , the components of which are discussed above, was $4.0 billion and $2.8 billion for the three months ended September 30, 2024 and 2023, respectively, and $10.9 billion and $8.4 billion for the nine months ended September 30, 2024 and 2023, respectively.

Income tax expense increased $203 million, or 29%, for the three months ended and increased $462 million, or 23%, for the nine months ended September 30, 2024.

The increase for the three months ended September 30, 2024, was primarily from:

• Higher income before income taxes;

partially offset by

• Net tax benefits recognized from a remeasurement of deferred tax assets and liabilities in certain state jurisdictions.

Our effective tax rate was 22.9% and 24.8% for the three months ended September 30, 2024 and 2023, respectively.

The increase for the nine months ended September 30, 2024, was primarily from:

Depreciation and amortization decreased $173 million, or 5%, primarily from higher depreciation expense from the acceleration of certain technology assets in the prior year.

Operating income , the components of which are discussed above, increased $802 million, or 20%.

Interest expense, net was essentially flat.

Other (expense) income, net was insignificant for both periods.

Income before income taxes , the components of which are discussed above, was $3.8 billion and $3.1 billion for the three months ended March 31, 2025 and 2024, respectively.

Income tax expense increased $121 million, or 16%, primarily from:

• Higher income before income taxes;

partially offset by

• An increase in tax benefits from adjustments to certain tax reserves;

• Net tax benefits recognized from a remeasurement of deferred tax assets and liabilities in certain state jurisdictions.

Our effective tax rate was 23.1% and 24.6% for the nine months ended September 30, 2024 and 2023, respectively.

Net income , the components of which are discussed above, was $3.1 billion and $2.1 billion for the three months ended September 30, 2024 and 2023, respectively, and $8.4 billion and $6.3 billion for the nine months ended September 30, 2024 and 2023, respectively.

Net income included:

• Merger-related costs, net of Merger-related gain and tax, of $91 million for the nine months ended September 30, 2024, compared to Merger-related costs, net of tax, of $114 million and $589 million for the three and nine months ended September 30, 2023, respectively.

There were no Merger-related costs for the three months ended September 30, 2024.

• Severance and related costs associated with the August 2023 workforce reduction of $353 million, net of tax, for the three and nine months ended September 30, 2023.

• An increase in excess tax benefits related to the vesting of restricted stock awards.

Our effective tax rate was 23.0% and 24.4% for the three months ended March 31, 2025 and 2024, respectively.

Net income , the components of which are discussed above, was $3.0 billion and $2.4 billion for the three months ended March 31, 2025 and 2024, respectively.

Net income included Sprint Merger-related costs, net of tax, of $97 million for the three months ended March 31, 2024.

There were no Sprint Merger-related costs for the three months ended March 31, 2025.

Guarantor Financial Information

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is presented in the table below:

(in millions) September 30, 2024 December 31, 2023

(in millions) March 31, 2025 December 31, 2024

Current assets $ 25,719 $ 16,741

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Noncurrent liabilities 126,418 122,934

122,112 128,197

Due to non-guarantors 1,547 1,507

Due to related parties 2,058 2,098

(1) The decrease in Noncurrent liabilities and Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the nine months ended September 30, 2024.

The summarized results of operations information for the consolidated obligor group of debt issued by T-Mobile USA, Inc.

is presented in the table below:

(in millions) Nine Months Ended

September 30, 2024 Year Ended

(in millions) Three Months Ended

March 31, 2025 Year Ended

December 31, 2024

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Operating expenses to non-guarantors 615 2,481

Other expense to non-guarantors (118) (699)

Other income (expense) to non-guarantors 3 (116)

The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint is presented in the table below:

(in millions) September 30, 2024 December 31, 2023

(in millions) March 31, 2025 December 31, 2024

Current assets $ 18,452 $ 10,970

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Noncurrent liabilities 96,903 96,145

88,466 110,688

Due to non-guarantors (1)

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Due to related parties 2,058 2,098

(1) The decrease in Noncurrent liabilities and Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the nine months ended September 30, 2024.

(1) The decrease in Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the three months ended March 31, 2025.

The summarized results of operations information for the consolidated obligor group of debt issued by Sprint is presented in the table below:

(in millions) Nine Months Ended

September 30, 2024 Year Ended

(in millions) Three Months Ended

March 31, 2025 Year Ended

December 31, 2024

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The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint Capital Corporation is presented in the table below:

(in millions) September 30, 2024 December 31, 2023

(in millions) March 31, 2025 December 31, 2024

Current assets $ 18,452 $ 10,970

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Noncurrent liabilities 93,030 92,278

84,609 106,881

Due to non-guarantors (1)

Due to related parties 2,058 2,098

(1) The decrease in Noncurrent liabilities and Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the nine months ended September 30, 2024.

(1) The decrease in Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the three months ended March 31, 2025.

The summarized results of operations information for the consolidated obligor group of debt issued by Sprint Capital Corporation is presented in the table below:

(in millions) Nine Months Ended

September 30, 2024 Year Ended

(in millions) Three Months Ended

March 31, 2025 Year Ended

December 31, 2024

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These operating and financial measures are utilized by our management to evaluate our operating performance and, in certain cases, our ability to meet liquidity requirements.

Although companies in the wireless industry may not define each of these measures in precisely the same way, we believe that these measures facilitate comparisons with other companies in the wireless industry on key operating and financial measures.

Although companies in the wireless communications services industry may not define each of these measures in precisely the same way, we believe that these measures facilitate comparisons with other companies in the wireless industry on key operating and financial measures.

Postpaid Accounts

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The following table sets forth the number of ending postpaid accounts:

As of September 30, Change

As of March 31, Change

(in thousands) 2025 2024 # %

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The following table sets forth the number of postpaid net account additions:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

Three Months Ended March 31, Change

(in thousands) 2025 2024 # %

Postpaid net account additions 205 218 (13) (6) %

Postpaid net account additions decreased 71,000, or 18%, for the three months ended and decreased 138,000, or 14%, for the nine months ended September 30, 2024, primarily from fewer High Speed Internet only additions, including from the impact of sunsetting certain promotional pricing in 2024.

Postpaid net account additions decreased 13,000, or 6%, for the three months ended March 31, 2025, primarily from higher account deactivations, including the impact from a growing account base and the temporary impact of current year rate plan optimizations, partially offset by higher gross account additions.

A customer is generally defined as a SIM number with a unique T-Mobile identifier which is associated with an account that generates revenue.

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The following table sets forth the number of ending customers:

As of September 30, Change

As of March 31, Change

(in thousands) 2025 2024 # %

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Prepaid customers 25,455 21,600 3,855 18 %

25,307 21,595 3,712 17 %

Total customers 130,910 120,872 10,038 8 %

Adjustments to customers (1)

3,504 — 3,504 NM

(1) In the second quarter of 2024, we acquired 3,504,000 prepaid customers through the Ka’ena Acquisition, which includes the impact of certain base adjustments to align the policies of Ka’ena and T-Mobile.

NM - Not meaningful

High Speed Internet customers included in Postpaid other customers were 5,377,000 and 3,807,000 as of September 30, 2024 and 2023, respectively.

High Speed Internet customers included in Prepaid customers were 625,000 and 428,000 as of September 30, 2024 and 2023, respectively.

Net Customer Additions

The following table sets forth the number of net customer additions:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

High Speed Internet customers included in Postpaid other customers were 6,129,000 and 4,634,000 as of March 31, 2025 and 2024, respectively.

High Speed Internet customers included in Prepaid customers were 725,000 and 547,000 as of March 31, 2025 and 2024, respectively.

Net Customer Additions (Losses)

The following table sets forth the number of net customer additions (losses):

Three Months Ended March 31, Change

(in thousands) 2025 2024 # %

Net customer additions

Net customer additions (losses)

Postpaid phone customers 495 532 (37) (7) %

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Total net customer additions 1,382 1,172 210 18 %

Adjustments to customers — — — NM 3,504 — 3,504 NM

NM - Not meaningful

Total net customer additions increased 294,000, or 23%, for the three months ended and was relatively flat for the nine months ended September 30, 2024.

The increase for the three months ended September 30, 2024, was primarily from:

Total net customer additions increased 210,000, or 18%, primarily from:

• Higher postpaid other net customer additions, primarily due to

• Higher prior year deactivations of lower ARPU mobile internet devices in the educational sector that were activated during the Pandemic and no longer needed;

• Higher net additions from other connected devices;

• Higher net additions from mobile internet devices;

• Higher net additions from High Speed Internet;

partially offset by

• Increased deactivations from a growing customer base;

• Lower net additions from wearables;

• Lower net additions from High Speed Internet, primarily due to lower gross additions driven by sunsetting of promotional pricing and increased deactivations from a growing customer base, partially offset by a lower churn rate;

• Higher postpaid phone net customer additions, primarily due to higher prepaid to postpaid migrations, lower churn and higher gross additions, partially offset by increased deactivations from a growing customer base;

• Higher prepaid net customer additions, primarily from higher net additions following the Ka’ena Acquisition and lower prepaid to postpaid migrations, partially offset by continued moderation of prepaid industry growth;

partially offset by

• Lower prepaid net customer additions, primarily driven by continued moderation of prepaid industry growth, higher prepaid to postpaid migrations and lower net additions from High Speed Internet, partially offset by higher net additions following the Ka’ena Acquisition.

• High Speed Internet net customer additions included in postpaid other net customer additions were 385,000 and 505,000 for the three months ended September 30, 2024 and 2023, respectively.

High Speed Internet net customer additions included in prepaid net customer additions were 30,000 and 52,000 for the three months ended September 30, 2024 and 2023, respectively.

The slight decrease for the nine months ended September 30, 2024, was primarily from:

• Lower prepaid net customer additions, primarily driven by continued moderation of prepaid industry growth, lower net additions from High Speed Internet and higher prepaid to postpaid migrations, partially offset by higher net additions following the Ka’ena Acquisition;

• Slightly higher postpaid other net customer additions, primarily due to

• Higher net additions from mobile internet devices, primarily due to higher prior year deactivations of lower ARPU mobile internet devices in the educational sector that were activated during the Pandemic and no longer needed;

• Higher net additions from other connected devices;

mostly offset by

• Lower net additions from wearables;

• Lower net additions from High Speed Internet, primarily driven by increased deactivations from a growing customer base and lower gross additions driven by sunsetting of promotional pricing, partially offset by a lower churn rate;

• Slightly higher postpaid phone net customer additions, primarily due to higher gross additions and higher prepaid to postpaid migrations, mostly offset by increased deactivations from a growing customer base.

• High Speed Internet net customer additions included in postpaid other net customer additions were 1,089,000 and 1,397,000 for the nine months ended September 30, 2024 and 2023, respectively.

High Speed Internet net customer additions included in prepaid net customer additions were 137,000 and 192,000 for the nine months ended September 30, 2024 and 2023, respectively.

• Lower postpaid phone net customer additions from higher churn, primarily driven by the temporary impact of current year rate plan optimizations, increased deactivations from a growing customer base and lower prepaid to postpaid migrations, partially offset by higher gross additions.

• High Speed Internet net customer additions included in postpaid other net customer additions were 387,000 and 346,000 for the three months ended March 31, 2025 and 2024, respectively.

High Speed Internet net customer additions included in prepaid net customer additions (losses) were 37,000 and 59,000 for the three months ended March 31, 2025 and 2024, respectively.

Churn represents the number of customers whose service was deactivated as a percentage of the average number of customers during the specified period further divided by the number of months in the period.

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The following table sets forth the churn:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

2024 2023 2024 2023

Postpaid phone churn 0.86 % 0.87 % -1 bps 0.84 % 0.84 % — bps

Prepaid churn 2.78 % 2.81 % -3 bps 2.69 % 2.73 % -4 bps

Postpaid phone churn decreased slightly for the three months ended September 30, 2024, and was relatively flat for the nine months ended September 30, 2024.

Prepaid churn decreased 3 basis points for the three months ended September 30, 2024, primarily due to promotional activity.

Prepaid churn decreased 4 basis points for the nine months ended September 30, 2024, primarily driven by the inclusion of prepaid customers associated with the Ka’ena Acquisition with lower churn.

Three Months Ended March 31, Change

Postpaid phone churn 0.91 % 0.86 % 5 bps

Prepaid churn 2.68 % 2.75 % -7 bps

Postpaid phone churn increased 5 basis points, primarily from the temporary impact of current year rate plan optimizations.

Prepaid churn decreased 7 basis points, primarily driven by the inclusion of prepaid customers associated with the Ka’ena Acquisition with lower churn.

Postpaid Average Revenue Per Account

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Postpaid ARPA is calculated as Postpaid revenues for the specified period divided by the average number of postpaid accounts during the period, further divided by the number of months in the period.

We believe postpaid ARPA provides management, investors and analysts with useful information to assess and evaluate our postpaid service revenue realization and assists in forecasting our future postpaid service revenues on a per account basis.

We believe postpaid ARPA provides management, investors and analysts with useful information to assess and evaluate our postpaid service revenue realization and

assists in forecasting our future postpaid service revenues on a per account basis.

We consider postpaid ARPA to be indicative of our revenue growth potential given the increase in the average number of postpaid phone customers per account and increases in postpaid other customers, including High Speed Internet, mobile internet devices (including tablets and hotspots), wearables, DIGITS and other connected devices (including SyncUP and IoT).

The following table sets forth our operating measure ARPA:

(in dollars) Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

(in dollars) Three Months Ended March 31, Change

2025 2024 $ %

Postpaid ARPA $ 146.22 $ 140.88 $ 5.34 4 %

Postpaid ARPA increased $5.77, or 4%, for the three months ended and increased $4.08, or 3%, for the nine months ended September 30, 2024, primarily from:

Postpaid ARPA increased $5.34, or 4%, primarily from:

• An increase in customers per account, including from the continued adoption of High Speed Internet;

• Higher premium services, primarily high-end rate plans, net of contra-revenues for content included in such plans, and discounts for specific affinity groups, such as 55+, military and first responders;

• An increase in customers per account, including continued adoption of High Speed Internet;

• The impact from rate plan optimizations;

• The positive impact from prior year rate plan optimizations;

partially offset by

• Increased promotional activity;

• An increase in High Speed Internet only accounts.

• An increase in total High Speed Internet only accounts.

Average Revenue Per User

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The following table sets forth our operating measure ARPU:

(in dollars) Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

(in dollars) Three Months Ended March 31, Change

2025 2024 $ %

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Postpaid Phone ARPU

Postpaid phone ARPU increased $0.86, or 2%, for the three months ended and increased $0.42, or 1%, for the nine months ended September 30, 2024, primarily from:

Postpaid phone ARPU increased $0.59, or 1%, primarily from:

• The impact from rate plan optimizations;

• The positive impact from prior year rate plan optimizations;

partially offset by

• Increased promotional activity;

• Growth in business customers with lower ARPU given larger account sizes.

Prepaid ARPU decreased $2.37, or 6%, for the three months ended and decreased $1.78, or 5%, for the nine months ended September 30, 2024, primarily from the inclusion of lower ARPU prepaid customers associated with the Ka’ena Acquisition.

• Increased promotional activity, including the success of bundled offerings and continued growth in T-Mobile for Business customers with lower ARPU given large account sizes.

Prepaid ARPU decreased $2.51, or 7%, primarily from the inclusion of prepaid customers with lower ARPU associated with the Ka’ena Acquisition.

Adjusted EBITDA and Core Adjusted EBITDA

Adjusted EBITDA represents earnings before Interest expense, net of Interest income, Income tax expense, Depreciation and amortization, stock-based compensation and certain expenses, gains and losses, which are not reflective of our ongoing operating performance (“Special Items”).

Special Items include Merger-related costs, loss (gain) on disposal groups held for sale, certain legal-related recoveries and expenses, restructuring costs not directly attributable to the Merger (including severance), and other non-core gains and losses.

Special Items include Sprint Merger-related costs, UScellular Merger-related costs, certain legal-related expenses, restructuring costs not directly attributable to the Sprint Merger or UScellular Merger (including severance), and other non-core gains and losses.

Core Adjusted EBITDA represents Adjusted EBITDA less device lease revenues.

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Core Adjusted EBITDA margin represents Core Adjusted EBITDA divided by Service revenues.

Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin are non-GAAP financial measures utilized by our management to monitor the financial performance of our operations.

Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin are non-GAAP financial measures utilized by our management, including our chief operating decision maker, to monitor the financial performance of our operations and allocate resources of the Company as a whole.

We historically used Adjusted EBITDA, and we currently use Core Adjusted EBITDA internally as a measure to evaluate and compensate our personnel and management for their performance.

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The following table illustrates the calculation of Adjusted EBITDA and Core Adjusted EBITDA and reconciles Adjusted EBITDA and Core Adjusted EBITDA to Net income, which we consider to be the most directly comparable GAAP financial measure:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

Three Months Ended March 31, Change

(in millions, except percentages) 2025 2024 $ %

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Interest expense, net 916 880 36 4 %

Other income, net (7) (41) 34 (83) % (19) (56) 37 (66) %

Other expense (income), net 46 (20) 66 (330) %

Income tax expense 885 764 121 16 %

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168 140 28 20 %

Merger-related costs (2)

— 152 (152) (100) % 121 786 (665) (85) %

Legal-related expenses (recoveries), net (3)

1 — 1 NM 16 (43) 59 (137) %

Gain on disposal group held for sale — — — NM — (25) 25 (100) %

Sprint Merger-related costs — 130 (130) (100) %

UScellular Merger-related costs (2)

Legal-related expenses, net (3)

Other, net (4)

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$ 8,258 $ 7,617 $ 641 8 %

Net income margin (Net income divided by Service revenues) 18 % 13 % 500 bps 17 % 13 % 400 bps

Adjusted EBITDA margin (Adjusted EBITDA divided by Service revenues) 49 % 48 % 100 bps 49 % 47 % 200 bps

Net income margin (Net income divided by Service revenues) 17 % 15 % 200 bps

Adjusted EBITDA margin (Adjusted EBITDA divided by Service revenues) 49 % 48 % 100 bps

Core Adjusted EBITDA margin (Core Adjusted EBITDA divided by Service revenues)

49 % 47 % 200 bps 48 % 46 % 200 bps

49 % 47 % 200 bps

(1) Stock-based compensation includes payroll tax impacts and may not agree with stock-based compensation expense on the condensed consolidated financial statements.

Additionally, certain stock-based compensation expenses associated with the Transactions have been included in Merger-related costs.

(2) Merger-related costs, for the nine months ended September 30, 2024, includes the $100 million gain recognized for the extension fee previously paid by DISH associated with the DISH License Purchase Agreement.

(3) Legal-related expenses (recoveries), net, consists of the settlement of certain litigation associated with the August 2021 cyberattack and is presented net of insurance recoveries.

(4) Other, net, primarily consists of certain severance, restructuring and other expenses, gains and losses, not directly attributable to the Merger, which are not reflective of T-Mobile’s core business activities and are, therefore, excluded from Adjusted EBITDA and Core Adjusted EBITDA.

Other, net, for the three and nine months ended September 30, 2023, includes $471 million of severance and related costs associated with the August 2023 workforce reduction.

Additionally, certain stock-based compensation expenses associated with the Sprint Merger have been included in Sprint Merger-related costs.

(2) UScellular Merger-related costs generally include pre-merger consulting and legal fees.

(3) Legal-related expenses, net, consists of the settlement of certain litigation and compliance costs associated with the August 2021 cyberattack and is presented net of insurance recoveries.

(4) Other, net, primarily consists of certain severance, restructuring and other expenses, gains and losses, not directly attributable to the Sprint Merger or UScellular Merger, which are not reflective of T-Mobile’s core business activities and are, therefore, excluded from Adjusted EBITDA and Core Adjusted EBITDA.

NM - Not meaningful

Core Adjusted EBITDA increased $675 million, or 9%, for the three months ended and increased $1.9 billion, or 9%, for the nine months ended September 30, 2024.

Core Adjusted EBITDA increased $641 million, or 8%, for the three months ended March 31, 2025.

The components comprising Core Adjusted EBITDA are discussed further above.

The increase for the three months ended September 30, 2024, was primarily from:

The increase was primarily from:

• Higher Total service revenues;

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partially offset by

• Higher Cost of equipment sales;

• Higher Selling, general and administrative expenses, excluding Special Items.

The increase for the nine months ended September 30, 2024, was primarily from:

• Higher Total service revenues;

• Lower Cost of services, excluding Special Items;

partially offset by

• Lower Equipment revenues, excluding lease revenues.

Adjusted EBITDA increased $643 million, or 8%, for the three months ended and increased $1.7 billion, or 8%, for the nine months ended September 30, 2024, primarily due to the fluctuations in Core Adjusted EBITDA, discussed above, partially offset by lower lease revenues, which decreased $32 million for the three months ended and decreased $187 million for the nine months ended September 30, 2024.

Adjusted EBITDA increased $607 million, or 8%, for the three months ended March 31, 2025, primarily due to the increase in Core Adjusted EBITDA, discussed above, partially offset by lower lease revenues, which decreased $34 million for the three months ended March 31, 2025.

Liquidity and Capital Resources

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The following is a condensed schedule of our cash flows:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

Three Months Ended March 31, Change

(in millions) 2025 2024 $ %

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Operating Activities

Net cash provided by operating activities increased $845 million, or 16%, for the three months ended and increased $3.0 billion, or 22%, for the nine months ended September 30, 2024.

The increase for the three months ended September 30, 2024, was primarily from:

• A $1.2 billion increase in Net income, adjusted for non-cash income and expenses;

partially offset by

• A $308 million increase in net cash outflows from changes in working capital, primarily due to higher use of cash from Accounts payable and accrued liabilities, Equipment installment plan receivables, Inventory and Short- and long-term operating lease liabilities, partially offset by lower use of cash from Accounts receivable, Other current and long-term liabilities and Other current and long-term assets.

• Net cash provided by operating activities includes the impact of $124 million and $345 million in net payments for Merger-related costs for the three months ended September 30, 2024 and 2023, respectively.

The increase for the nine months ended September 30, 2024, was primarily from:

• A $2.8 billion increase in Net income, adjusted for non-cash income and expenses;

• A $223 million decrease in net cash outflows from changes in working capital, primarily due to lower use of cash from Accounts receivable and Other current and long-term liabilities, partially offset by higher use of cash from Other current and long-term assets, Accounts payable and accrued liabilities, Inventory, Operating lease right-of-use assets and Equipment installment plan receivables.

• Net cash provided by operating activities includes the impact of $658 million and $1.6 billion in net payments for Merger-related costs for the nine months ended September 30, 2024 and 2023, respectively.

Net cash provided by operating activities increased $1.8 billion, or 35%, primarily from:

• A $1.1 billion decrease in net cash outflows from changes in working capital, primarily due to lower use of cash from Accounts payable and accrued liabilities, Accounts receivable and Short- and long-term operating lease liabilities, partially offset by higher use of cash from Inventory, Equipment installment plan receivables and Other current and long-term assets;

• A $663 million increase in Net income, adjusted for non-cash income and expenses.

• Net cash provided by operating activities includes the impact of the Pledge Amendments as described below.

• Net cash provided by operating activities includes the impact of $61 million and $293 million in net payments for Sprint Merger-related costs for the three months ended March 31, 2025 and 2024, respectively.

Investing Activities

Net cash used in investing activities increased $1.9 billion, or 137%, for the three months ended and increased $2.2 billion, or 47%, for the nine months ended September 30, 2024.

The use of cash for the three months ended September 30, 2024, was primarily from:

• $2.4 billion in Purchases of spectrum licenses and other intangible assets, including deposits, primarily for the first tranche of 600 MHz licenses purchased from Channel 51 License Co LLC and LB License Co, LLC (see Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements) ;

• $2.0 billion in Purchases of property and equipment, including capitalized interest, from the continued build-out of our nationwide 5G network ;

partially offset by

• $984 million in Proceeds related to beneficial interests in securitization transactions.

The use of cash for the nine months ended September 30, 2024, was primarily from:

Net cash used in investing activities increased $1.6 billion, or 91%.

The use of cash was primarily from:

• $2.5 billion in Purchases of property and equipment, including capitalized interest, from the continued build-out of our nationwide 5G network;

• $2.6 billion in Purchases of spectrum licenses and other intangible assets, including deposits, primarily for the first tranche of 600 MHz licenses purchased from Channel 51 License Co LLC and LB License Co, LLC (see Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements);

• $390 million of cash consideration, net of cash acquired, related to the Ka’ena Acquisition;

partially offset by

• $2.8 billion in Proceeds related to beneficial interests in securitization transactions.

• $727 million of cash consideration, net of cash acquired, related to our acquisitions of Vistar and Blis.

Financing Activities

Net cash provided by financing activities increased $6.0 billion from a net use of cash for the three months ended September 30, 2023, to a net source of cash for the three months ended September 30, 2024.

Net cash used in financing activities decreased $3.3 billion, or 38%, for the nine months ended September 30, 2024.

The source of cash for the three months ended September 30, 2024, was primarily from:

Net cash provided by financing activities increased $4.9 billion from a net use of cash for the three months ended March 31, 2024, to a net source of cash for the three months ended March 31, 2025.

The net source of cash was primarily from:

• $7.8 billion in Proceeds from issuance of long-term debt;

partially offset by

• $758 million in Dividends on common stock;

• $560 million in Repurchases of common stock;

• $347 million in Repayments of financing lease obligations;

• $223 million in Repayments of long-term debt.

The use of cash for the nine months ended September 30, 2024, was primarily from:

• $2.5 billion in Repurchases of common stock;

• $3.2 billion in Repayments of long-term debt;

• $1.0 billion in Dividends on common stock;

• $1.0 billion in Repayments of financing lease obligations;

• $479 million in Repayments of long-term debt;

• $315 million in Repayments of financing lease obligations;

• $272 million in Tax withholdings on share-based awards.

partially offset by

• $8.1 billion in Proceeds from issuance of long-term debt.

Cash and Cash Equivalents

As of September 30, 2024, our Cash and cash equivalents were $9.8 billion compared to $5.1 billion at December 31, 2023.

As of March 31, 2025, our Cash and cash equivalents were $12.0 billion compared to $5.4 billion at December 31, 2024.

Adjusted Free Cash Flow

Adjusted Free Cash Flow represents Net cash provided by operating activities less cash payments for Purchases of property and equipment, plus Proceeds from sales of tower sites and Proceeds related to beneficial interests in securitization transactions.

Adjusted Free Cash Flow represents Net cash provided by operating activities less cash payments for Purchases of property and equipment, plus Proceeds related to beneficial interests in securitization transactions.

Adjusted Free Cash Flow is a non-GAAP financial measure utilized by management, investors and analysts of our financial information to evaluate cash available to pay debt, repurchase shares, pay dividends and provide further investment in the business.

Adjusted Free Cash Flow margin is calculated as Adjusted Free Cash Flow divided by Service revenues.

Free Cash Flow margin is utilized by management, investors, and analysts to evaluate the Company’s ability to convert service revenue efficiently into cash available to pay debt, repurchase shares, pay dividends and provide further investment in the business.

Adjusted Free Cash Flow margin is utilized by management, investors, and analysts to evaluate the Company’s ability to convert service revenue efficiently into cash available to pay debt, repurchase shares, pay dividends and provide further investment in the business.

The table below provides a reconciliation of Adjusted Free Cash Flow to Net cash provided by operating activities, which we consider to be the most directly comparable GAAP financial measure:

Three Months Ended

September 30, Change Nine Months Ended

September 30, Change

Three Months Ended March 31, Change

(in millions, except percentages) 2025 2024 $ %

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Cash purchases of property and equipment, including capitalized interest (2,451) (2,627) 176 (7) %

Proceeds from sales of tower sites — 2 (2) (100) % — 10 (10) (100) %

Proceeds related to beneficial interests in securitization transactions — 890 (890) (100) %

Adjusted Free Cash Flow $ 4,396 $ 3,347 $ 1,049 31 %

Net cash provided by operating activities margin (Net cash provided by operating activities divided by Service revenues) 37 % 33 % 400 bps 34 % 29 % 500 bps

Adjusted Free Cash Flow margin (Adjusted Free Cash Flow divided by Service revenues) 31 % 25 % 600 bps 26 % 20 % 600 bps

Adjusted Free Cash Flow increased $1.2 billion, or 29%, for the three months ended and increased $3.7 billion, or 40%, for the nine months ended September 30, 2024, primarily from:

Net cash provided by operating activities margin (Net cash provided by operating activities divided by Service revenues) 40 % 32 % 800 bps

Adjusted Free Cash Flow margin (Adjusted Free Cash Flow divided by Service revenues) 26 % 21 % 500 bps

Adjusted Free Cash Flow increased $1.0 billion, or 31%, for the three months ended March 31, 2025, primarily from:

• Higher Net cash provided by operating activities, as described above;

• Lower Cash purchases of property and equipment, including capitalized interest, driven by increased capital efficiencies from accelerated investments in our nationwide 5G network in previous years;

• Lower Cash purchases of property and equipment, including capitalized interest, driven by planned timing of capital purchases;

partially offset by

• Lower Proceeds related to beneficial interests in securitization transactions, which were offset in Net cash provided by operating activities.

• Adjusted Free Cash Flow includes the impact of $124 million and $345 million for the three months ended September 30, 2024 and 2023, respectively, and $658 million and $1.6 billion for the nine months ended September 30, 2024 and 2023, respectively, in net payments for Merger-related costs.

During the nine months ended September 30, 2024 and 2023, there were no significant net cash proceeds from securitization.

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”).

Following the effective date of the Pledge Amendments of November 1, 2024, 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.

The Pledge Amendments will not have a net impact on Adjusted Free Cash Flow.

See Note 5 – Sales of Certain Receivables of the Notes to the Condensed Consolidated Financial Statements for additional information.

• Proceeds related to beneficial interests in securitization transactions recognized in the prior year.

• Adjusted Free Cash Flow includes the impact of $61 million and $293 million for the three months ended March 31, 2025 and 2024, respectively, in net payments for Sprint Merger-related costs.

During the three months ended March 31, 2025 and 2024, there were no significant net cash proceeds from securitization.

On October 22, 2024, we executed amendments (the “Pledge Amendments”) to the EIP Sale Arrangement and the Service Receivable Sale Arrangement (as discussed in Note 5 – Sales of Certain Receivables of the Notes to the Condensed Consolidated Financial Statements).

Following the effective date of the Pledge Amendments of November 1, 2024, all cash proceeds associated with the sale of such receivables, a portion of which, prior to November 1, 2024, were 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, were recognized as operating cash flows.

The Pledge Amendments did not have a net impact on Adjusted Free Cash Flow.

Borrowing Capacity

We maintain a revolving credit facility (the “Revolving Credit Facility”) with an aggregate commitment amount of $7.5 billion.

As of September 30, 2024, there was no outstanding balance under the Revolving Credit Facility.

As of March 31, 2025, there was no outstanding balance under the Revolving Credit Facility.

We maintain an unsecured short-term commercial paper program with the ability to borrow up to $2.0 billion from time to time.

This program supplements our other available external financing arrangements and proceeds are expected to be used for general corporate purposes.

As of September 30, 2024, there was no outstanding balance under this program.

As of March 31, 2025, there was no outstanding balance under this program.

Debt Financing

As of September 30, 2024, our total debt and financing lease liabilities were $82.3 billion, excluding our tower obligations, of which $74.0 billion was classified as long-term debt and $1.2 billion was classified as long-term financing lease liabilities.

During the nine months ended September 30, 2024, we issued long-term debt for net proceeds of $8.1 billion and repaid short-term debt with an aggregate principal amount of $3.2 billion.

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.

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.

On January 31, 2025, our wholly owned subsidiary, T-Mobile USA, Inc., entered into a credit agreement with certain financial institutions, backed by an Export Credit Agency (the “ECA Facility”), providing for a loan of up to $1.0 billion.

On March 17, 2025, we drew down the full $1.0 billion available under the ECA Facility and recognized the net proceeds within Proceeds from issuance of long-term debt on our Condensed Consolidated Statements of Cash Flows.

As of March 31, 2025, our total debt and financing lease liabilities were $88.0 billion, excluding our tower obligations, of which $77.5 billion was classified as long-term debt and $1.1 billion was classified as long-term financing lease liabilities.

During the three months ended March 31, 2025, we issued long-term debt for net proceeds of $7.8 billion, including proceeds from the ECA Facility, and repaid short-term debt with an aggregate principal amount of $479 million.

Subsequent to March 31, 2025, on April 15, 2025, we repaid at maturity $3.0 billion of our 3.500% Senior Notes due 2025.

For more information regarding our debt financing transactions, see Note 8 – Debt of the Notes to the Condensed Consolidated Financial Statements.

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

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

The purchase of the Dallas licenses closed on December 6, 2024, and the associated payment of $541 million was made on the same day.

We anticipate that the remaining deferred licenses from the second tranche of $604 million will close in the second quarter of 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.

On September 12, 2023, we entered into a license purchase agreement with Comcast pursuant to which we will acquire spectrum in the 600 MHz band from Comcast in exchange for total cash consideration of between $1.2 billion and $3.3 billion, subject to an application for FCC approval.

The licenses are subject to an exclusive leasing arrangement between us and Comcast entered into contemporaneously with the license purchase agreement.

On September 12, 2023, we entered into a License Purchase Agreement with Comcast (the “Comcast License Purchase Agreement”) pursuant to which we will acquire spectrum in the 600 MHz band from Comcast in exchange for total cash consideration of between $1.2 billion and $3.3 billion, subject to an application for FCC approval.

The licenses are subject to an exclusive leasing arrangement between us and Comcast entered into contemporaneously with the Comcast License Purchase Agreement.

On January 13, 2025, we and Comcast entered into an amendment to the Comcast License Purchase Agreement pursuant to which we will acquire additional spectrum.

Subsequent to the amendment, the total cash consideration for the transaction is between $1.2 billion and $3.4 billion.

We anticipate the closing will occur in the first half of 2028.

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 Buyer’s committed financing is less than a certain target level of cash consideration.

If we do not terminate the license purchase agreement, the transaction is subject to FCC approval.

Acquisition of Ka’ena Corporation

On the Acquisition Date, we completed the Ka’ena Acquisition.

The total purchase price is variable, dependent upon specified performance indicators of Ka’ena, and consists of an upfront payment on the Acquisition Date and an earnout payable on August 1, 2026.

A portion of the upfront payment made on the Acquisition Date was for the settlement of the preexisting wholesale relationship with Ka’ena.

For more information regarding the Ka’ena Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

As of March 31, 2025, $1.8 billion of the associated licenses have been classified as held for sale at cost and presented in Other current assets on our Condensed Consolidated Balance Sheets.

The transaction is subject to receipt of regulatory approvals and is expected to close in the second quarter of 2025.

The closing of this transaction is not expected to have a material impact on our Condensed Consolidated Statements of Comprehensive Income.

Lumos Joint Venture

On April 24, 2024, we entered into a merger agreement with Fund VI for the joint acquisition by us and Fund VI of Lumos 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.

On April 24, 2024, we entered into a definitive agreement with Fund VI to establish a joint venture between us and Fund VI to acquire Lumos from EQT’s predecessor fund, EQT Infrastructure III.

Subsequent to March 31, 2025, on April 1, 2025, we completed the joint acquisition of Lumos.

At closing, we invested $926 million to acquire a 50% equity interest in the joint venture and fiber customers.

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

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

In addition, pursuant to the

definitive agreement, we expect to make an additional capital contribution of approximately $500 million in 2027 or 2028 under the existing business plan.

For more information regarding the Lumos joint venture, see Note 3 – Joint Ventures of the Notes to the Condensed Consolidated Financial Statements.

UScellular Wireless Operations

On May 24, 2024, we entered into a securities purchase agreement with UScellular 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.

Acquisition of Ka’ena Corporation

On May 1, 2024, we completed the Ka’ena Acquisition.

For more information regarding the Ka’ena Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Acquisition of UScellular Wireless Operations

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.

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On July 18, 2024, we entered into a definitive agreement with KKR to establish a joint venture to acquire Metronet.

This arrangement is expected to close in 2025, subject to customary closing conditions and regulatory approvals.

At closing, we expect to invest approximately $4.9 billion in the joint venture to acquire a 50% equity interest and all existing residential fiber customers, as well as funding the joint venture.

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

This arrangement is expected to close in mid-2025, subject to customary closing conditions and regulatory approvals.

At closing, we expect to invest approximately $4.9 billion to acquire a 50% equity interest in the joint venture and all existing residential fiber customers, as well as funding of the joint venture.

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

For more information regarding the Metronet joint venture, see Note 3 – Joint Ventures of the Notes to the Condensed Consolidated Financial Statements.

Acquisition of Vistar Media Inc.

Upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals, on February 3, 2025, we completed the Vistar Acquisition, and as a result, Vistar became a wholly owned subsidiary of T-Mobile.

In exchange, T-Mobile transferred cash of $621 million.

For more information regarding the Vistar Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Acquisition of Blis Holdco Limited

Upon the completion of certain customary closing conditions, including the receipt of certain regulatory approvals, on March 3, 2025, we completed the Blis Acquisition, and as a result, Blis became a wholly owned subsidiary of T-Mobile.

In exchange, T-Mobile transferred cash of $180 million.

For more information regarding the Blis Acquisition, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Off-Balance Sheet Arrangements

We have arrangements, as amended from time to time, to sell certain EIP accounts receivable and service accounts receivable on a revolving basis as a source of liquidity.

As of September 30, 2024, we derecognized net receivables of $2.3 billion upon sale through these arrangements.

As of March 31, 2025, we derecognized net receivables of $1.6 billion upon sale through these arrangements.

For more information regarding these off-balance sheet arrangements, see Note 5 – Sales of Certain Receivables of the Notes to the Condensed Consolidated Financial Statements.

Future Sources and Uses of Liquidity

We may seek additional sources of liquidity, including through the issuance of additional debt, to continue to opportunistically acquire spectrum licenses or other long-lived assets in private party transactions, repurchase shares, pay dividends or for the refinancing of existing long-term debt on an opportunistic basis.

We may seek additional sources of liquidity, including through the issuance of additional debt, to continue to opportunistically acquire spectrum licenses or other long-lived assets in private party transactions, make strategic investments, repurchase shares, pay dividends or for the refinancing of existing long-term debt on an opportunistic basis.

Excluding liquidity that could be needed for acquisitions of businesses, spectrum and other long-lived assets, or for any potential stockholder returns, we expect our principal sources of funding to be sufficient to meet our anticipated liquidity needs for business operations for the next 12 months, as well as our longer-term liquidity needs.

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We regularly review and update these projections for changes in current and projected financial and operating results, general economic conditions, the competitive landscape and other factors.

We have incurred, and will incur, substantial expenses to comply with the Government Commitments, and we have incurred all of the remaining restructuring and integration costs associated with the Merger, with the cash expenditures for the Merger-related costs extending beyond 2024.

We have incurred, and will incur, substantial expenses to comply with the Government Commitments (as defined below), and we have incurred all of the remaining restructuring and integration costs associated with the Sprint Merger, with the cash expenditures for the Sprint Merger-related costs extending beyond 2024.

There are a number of additional risks and uncertainties that could cause our financial and operating results and capital requirements to differ materially from our projections, which could cause future liquidity to differ materially from our assessment.

The indentures, supplemental indentures and credit agreements governing our long-term debt to affiliates and third parties, excluding financing leases, contain covenants that, among other things, limit the ability of the Issuers or borrowers and the Guarantor Subsidiaries to incur more debt, create liens or other encumbrances, and merge, consolidate or sell, or otherwise dispose of, substantially all of their assets.

We were in compliance with all restrictive debt covenants as of September 30, 2024.

We were in compliance with all restrictive debt covenants as of March 31, 2025.

Financing Lease Facilities

We have uncommitted financing lease facilities with certain third parties that provide us with the ability to enter into financing leases for network equipment and services.

As of September 30, 2024, we have entered into $9.7 billion of financing leases under these financing lease facilities, of which $402 million and $969 million was executed during the three and nine months ended September 30, 2024, respectively.

We expect to enter into up to a total of $1.2 billion in financing lease commitments during the year ending December 31, 2025.

As of March 31, 2025, we have entered into $10.2 billion of financing leases under these financing lease facilities, of which $243 million was executed during the three months ended March 31, 2025.

Capital Expenditures

Our liquidity requirements have been driven primarily by capital expenditures for spectrum licenses, the construction, expansion and upgrading of our network infrastructure and the integration of the networks, spectrum, technology, personnel and customer base of T-Mobile and Sprint.

Property and equipment capital expenditures primarily relate to the integration of our network and spectrum licenses, including acquired Sprint PCS and 2.5 GHz spectrum licenses, as we build out our nationwide 5G network.

We expect a reduction in capital expenditures related to these efforts in 2024 compared to 2023 given the substantial deployment of the 5G network completed in the preceding years.

Future capital expenditure requirements will include the deployment of our acquired C-band licenses.

Our liquidity requirements for capital expenditures have been driven primarily by capital expenditures for spectrum licenses, the construction, expansion and upgrading of our network infrastructure, the integration of the networks, spectrum, technology, personnel and customer base of T-Mobile and Sprint, which is substantially complete, and investments in information technology platforms.

We expect to maintain our investment in capital expenditures related to these efforts in 2025 compared to 2024, as we continue to build out our nationwide 5G network and our digital transformation.

Future capital expenditure requirements will be primarily driven by the deployment of acquired spectrum licenses.

For more information regarding our spectrum licenses, see Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements.

Stockholder Returns

On September 6, 2023, our Board of Directors authorized our 2023-2024 Stockholder Return Program for up to $19.0 billion that will run from October 1, 2023, through December 31, 2024.

On December 13, 2024, we announced that our Board of Directors authorized our 2025 Stockholder Return Program of up to $14.0 billion that will run through December 31, 2025.

The 2025 Stockholder Return Program consists of repurchases of shares of our common stock and the payment of cash dividends.

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The amount available under the 2025 Stockholder Return Program for share repurchases will be reduced by the amount of any cash dividends declared and paid by us.

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 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 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.

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

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 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.

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.

The 2025 Stockholder Return Program is consistent with the Company’s capital allocation framework outlined during its Capital Markets Day in September 2024.

As discussed at Capital Markets Day, the Company expects its business plan to support approximately $80.0 billion in investments and capital returns between September 18, 2024, and the end of 2027.

The Company currently plans to allocate such funds as follows:

• Up to $50.0 billion for share repurchases and cash dividends, which includes the 2025 Stockholder Return Program;

• Approximately $19.0 billion in a discretionary and flexible envelope for potential activities, which may include de-levering, investments in our core business, strategic investments, and/or additional capital returns to stockholders beyond the $50.0 billion initial allocation;

• Approximately $11.0 billion for announced transactions, including the acquisitions closed during the three months ended March 31, 2025.

See Note 2 - Business Combinations , Note 3 - Joint Ventures and Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets for additional information.

On November 21, 2024, our Board of Directors declared a cash dividend of $0.88 per share on our issued and outstanding common stock, which was paid on March 13, 2025, to stockholders of record as of the close of business on February 28, 2025.

On February 6, 2025, 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 June 12, 2025, to stockholders of record as of the close of business on May 30, 2025.

During the three months ended March 31, 2025, we paid an aggregate of $1.0 billion 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.

As of March 31, 2025, $993 million for dividends payable is presented within Other current liabilities on our Condensed Consolidated Balance Sheets.

During the three months ended March 31, 2025, we repurchased 10,091,227 shares of our common stock at an average price per share of $244.77 for a total purchase price of $2.5 billion under the 2025 Stockholder Return Program.

As of March 31, 2025, we had up to $10.5 billion remaining under the 2025 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2025.

Subsequent to March 31, 2025, from April 1, 2025, through April 17, 2025, we repurchased 1,975,200 shares of our common stock at an average price per share of $259.09 for a total purchase price of $512 million under the 2025 Stockholder Return Program.

As of April 17, 2025, we had up to $10.0 billion remaining under the 2025 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2025.

For additional information regarding the 2025 Stockholder Return Program, see Note 1 2 – Stockholder Return Program of the Notes to the Condensed Consolidated Financial Statements.

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We have related party transactions associated with DT, SoftBank or their respective affiliates in the ordinary course of business, including intercompany servicing and licensing.

As of October 18, 2024, DT and SoftBank held, directly or indirectly, approximately 50.7% and 7.4%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 41.9% of the outstanding T-Mobile common stock held by other stockholders.

As a result of the Proxy, Lock-Up and ROFR Agreement, dated April 1, 2020, by and between DT and SoftBank, DT has voting control, as of October 18, 2024, over approximately 57.8% of the outstanding T-Mobile common stock.

As of April 17, 2025, DT and SoftBank held, directly or indirectly, approximately 51.8% and 7.5%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 40.7% of the outstanding T-Mobile common stock held by other stockholders.

As a result of the Proxy, Lock-Up and ROFR Agreement, dated April 1, 2020, by and between DT and SoftBank, DT has voting control, as of April 17, 2025, over approximately 59.0% of the outstanding T-Mobile common stock.

Disclosure of Iranian Activities under Section 13(r) of the Exchange Act

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affiliates in compliance with applicable law, and whether or not the activities are sanctionable under U.S.

As of the date of this report, we are not aware of any activity, transaction or dealing by us or any of our affiliates for the three months ended September 30, 2024, that requires disclosure in this report under Section 13(r) of the Exchange Act, except as set forth below with respect to affiliates that we do not control and that are our affiliates solely due to their common control with either DT or SoftBank.

As of the date of this report, we are not aware of any activity, transaction or dealing by us or any of our affiliates for the three months ended March 31, 2025, that requires disclosure in this report under Section 13(r) of the Exchange Act, except as set forth below with respect to affiliates that we do not control and that are our affiliates solely due to their common control with either DT or SoftBank.

We have relied upon DT and SoftBank for information regarding their respective activities, transactions and dealings.

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Irancell Telecommunications Services Company, Telecommunication Kish Company, Mobile Telecommunication Company of Iran, and Telecommunication Infrastructure Company of Iran.

In addition, during the three months ended September 30, 2024, DT, through certain of its non-U.S.

subsidiaries, provided basic telecommunications services to five customers in Germany identified on the Specially Designated Nationals and Blocked Persons List maintained by the U.S.

In addition, during the three months ended March 31, 2025, DT, through certain of its non-U.S.

subsidiaries, provided basic telecommunications services to seven customers in Germany identified on the Specially Designated Nationals and Blocked Persons List maintained by the U.S.

Department of Treasury’s Office of Foreign Assets Control:

Bank Melli, Europäisch-Iranische Handelsbank, CPG Engineering & Commercial Services GmbH, Golgohar Trade and Technology GmbH and International Trade and Industrial Technology ITRITEC GmbH.

These services have been terminated or are in the process of being terminated.

For the three months ended September 30, 2024, gross revenues of all DT affiliates generated by roaming and interconnection traffic and telecommunications services with the Iranian parties identified herein were less than $0.1 million, and the estimated net profits were less than $0.1 million.

Bank Melli, Europäisch-Iranische Handelsbank, CPG Engineering & Commercial Services GmbH, Golgohar Trade and Technology GmbH, International Trade and Industrial Technology ITRITEC GmbH, The Airline of the Islamic Republic of Iran and Kara Industrial Trading GmbH.

These services are in the process of being terminated, in particular by undertaking appropriate legal steps before German courts.

For the three months ended March 31, 2025, gross revenues of all DT affiliates generated by roaming and interconnection traffic and telecommunications services with the Iranian parties identified herein were less than $0.1 million, and the estimated net profits were less than $0.1 million.

In addition, DT, through certain of its non-U.S.

subsidiaries that operate a fixed-line network in their respective European home countries (in particular, Germany), provides telecommunications services in the ordinary course of business to the Embassy of Iran in those European countries.

Gross revenues and net profits recorded from these activities for the three months ended September 30, 2024, were less than $0.1 million.

Gross revenues and net profits recorded from these activities for the three months ended March 31, 2025, were less than $0.1 million.

We understand that DT intends to continue these activities.

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subsidiaries, provides roaming services in Iran through Irancell Telecommunications Services Company.

During the three months ended September 30, 2024, SoftBank had no gross revenues from such services, and no net profit was generated.

During the three months ended March 31, 2025, SoftBank had no gross revenues from such services, and no net profit was generated.

We understand that the SoftBank subsidiary intends to continue such services.

This subsidiary also provides telecommunications services in the ordinary course of business to accounts affiliated with the Embassy of Iran in Japan.

During the three months ended September 30, 2024, SoftBank estimates that gross revenues and net profit generated by such services were both under $0.1 million.

During the three months ended March 31, 2025, SoftBank estimates that gross revenues and net profit generated by such services were both under $0.1 million.

We understand that the SoftBank subsidiary is obligated under contract and intends to continue such services.

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indirect subsidiaries, provides office supplies to the Embassy of Iran in Japan.

SoftBank estimates that gross revenues and net profit generated by such services during the three months ended September 30, 2024, were both under $0.1 million.

SoftBank estimates that gross revenues and net profit generated by such services during the three months ended March 31, 2025, were both under $0.1 million.

We understand that the SoftBank subsidiary intends to continue such activities.

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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 2. Management’s Discussion and Analysis