T-Mobile Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Postpaid Net Account Additions: 277,000, contributing to a total of nearly 500,000 in the first half of the year.

Postpaid Service Revenue Growth: Up 13% year-over-year.

Total Service Revenue Growth: Up 9% year-over-year, with Q3 expectations of approximately $19.3 billion (up 6% year-over-year).

Core Adjusted EBITDA: Increased by 12% year-over-year; full-year guidance set between $37.1 billion and $37.5 billion (10% growth at midpoint).

Free Cash Flow Margin: Industry-leading at 25%, with adjusted free cash flow guidance raised to between $18.4 billion and $18.8 billion.

Average Revenue Per Account (ARPA): Grew by 2% year-over-year, with expectations for 2.5% to 3% growth for the full year.

2Strategic Updates and Business Highlights

Network Performance: T-Mobile achieved a record high Net Promoter Score (NPS) of 46, the highest among major carriers, reflecting strong customer satisfaction.

5G Broadband Growth: T-Mobile is the fastest-growing ISP in the U.S., with broadband offerings delivering fiber-like speeds and leading customer satisfaction metrics.

Acquisition of UScellular: Integration progressing well, enhancing market share in smaller and rural markets.

New Leadership: Chris Sambar appointed as Chief Enterprise Officer to drive growth in the business segment.

Innovative Initiatives: Launched live translation on beta, showcasing advancements in AI and network capabilities.

3Forward Guidance and Outlook

Postpaid Account Net Additions: Expected to range between 950,000 and 1,050,000 for the full year, with a temporary increase in churn anticipated in Q3 due to rate plan modernization.

Service Revenue Guidance: Full-year service revenues projected at approximately $77 billion, with continued growth anticipated.

Core Adjusted EBITDA: Expected to maintain a growth trajectory of around 10% year-over-year.

Capital Expenditures: Cash CapEx guidance remains at approximately $10 billion for the year, with ongoing share buybacks.

4Bad News, Challenges, or Points of Concern

Churn Rates: A temporary increase in churn is expected in Q3 due to the modernization of rate plans, particularly affecting accounts with fewer lines.

Competitive Pressures: Increased device prices and a shift in focus from device subsidies to value propositions may impact customer acquisition strategies.

Prepaid Segment Dynamics: There are challenges in the prepaid segment, with some customers migrating to competitors, although T-Mobile is successfully converting some to postpaid.

5Notable Q&A Insights

Volume vs. Price Growth: Management emphasized a balanced approach to maximizing customer lifetime value (CLV) while attracting network seekers, with a focus on maintaining ARPA growth despite competitive pressures.

Fixed Wireless Access (FWA): T-Mobile remains confident in its FWA strategy, citing superior product performance compared to competitors, including low Earth orbit (LEO) satellite offerings.

Fiber Strategy: T-Mobile's fiber initiatives are performing well, with a focus on creating shareholder value rather than merely increasing the number of homes passed.

Direct-to-Device (D2D) Strategy: Management confirmed that exclusivity with Starlink remains in place, with ongoing discussions about the JV's future. Overall, T-Mobile's Q2 2026 results reflect strong operational performance and strategic positioning, although challenges related to churn and competitive dynamics in the prepaid market warrant attention.