We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
T-Mobile's (TMUS) Q1 Earnings Top on Industry-Leading Growth
Read MoreHide Full Article
T-Mobile US, Inc. (TMUS - Free Report) reported mixed first-quarter 2024 results, with the bottom line beating the Zacks Consensus Estimate but the top line missing the same.
The Bellevue, WA-based wireless service provider reported industry-leading postpaid customer growth with a record low churn rate. T-Mobile follows a multi-layer approach to 5G with dedicated standalone 5G deployed nationwide across 600MHz, 1.9GHz, and 2.5GHz bands.
Net Income
Net income in the first quarter was $2,374 million or $2.00 per share, up from $1,940 million or $1.58 per share in the year-ago quarter. The 22.4% year-over-year growth was primarily driven by lower operating expenses. The bottom line exceeded the Zacks Consensus Estimate of $1.83.
T-Mobile US, Inc. Price, Consensus and EPS Surprise
Net sales during the quarter were $19,594 million, marginally down from $19,632 million in the year-ago quarter, as solid growth in service revenue was more than offset by declining equipment sales. The top line missed the consensus estimate of $19,637 million.
Segment Results
Total Service revenues were $16,096 million, up from $15,546 million in the year-ago quarter. The segment sales missed our revenue estimate of $16,203.5 million. The 3.5% year-over-year growth was primarily driven by solid demand for postpaid services. Net sales from Postpaid Services contributed $12,631 million in revenues, up 6.5% year over year.
During the quarter, T-Mobile added 1.2 million postpaid net customers, while postpaid net account additions were 218,000 – both metrics being the best in the industry. Postpaid phone net customer additions were 532,000, the best in the industry. Postpaid phone churn rate was 0.86%, equaling the lowest for the quarter in the company’s history. High-speed Internet net customer additions were 405,000. Postpaid average revenues per account rose to $140.88 from $138.04 in the year-ago quarter.
Net sales from Prepaid services were $2,403 million, marginally down from $2,417 million in the year-earlier quarter. Prepaid net customer losses were 48,000 with a churn rate of 2.75%. Wholesale and other service revenues decreased to $1,062 million from $1,267 million in the year-earlier quarter. Prepaid ARPU (average revenues per user) declined to $37.18 from $37.98 in the year-ago quarter.
Equipment revenues were $3,251 million, down from $3,719 million in the prior year. The segment revenues beat our estimate of $3,140 million. Lower postpaid upgrades, driven by longer device lifecycles, led to a lower number of devices and accessories sold. Lower sales of prepaid and Assurance Wireless devices also adversely impacted the top line in this vertical.
Other revenues were $247 million, down from the prior-year quarter’s tally of $367 million.
Other Details
Total operating expenses declined to $15,596 million from $16,235 million in the year-ago quarter. Consequently, operating income rose to $3,998 million from $3,397 million. T-Mobile recorded core adjusted EBITDA of $7,617 million compared with $7,052 million a year ago, backed by solid growth in service revenues.
Cash Flow & Liquidity
In the March quarter, T-Mobile generated $5,084 million of cash from operating activities compared with $4,051 million in the prior-year quarter. Adjusted free cash flow was $3,347 million, up from $2,401 million in the year-earlier quarter. The growth was driven by improvement in operating cash flow and lower cash purchases of property and equipment.
As of Mar 31, 2024, the company had $6,708 million in cash and cash equivalents, with $71,361 million of long-term debt. During the quarter, it repurchased 21.9 million shares for $3.6 billion.
Guidance Up
With improved operating metrics, the company presently expects postpaid net customer additions to be between 5.2 million and 5.6 million, up from 5 million and 5.5 million expected earlier. Core adjusted EBITDA is estimated to be $31.4-$31.9 billion. It anticipates cash from operating activities within $21.6-$22.3 billion. TMUS expects adjusted free cash flow in the band of $16.4-$16.9 billion. Capital expenditure is projected to be in the range of $8.6-$9.4 billion.
Qualcomm Incorporated (QCOM - Free Report) is scheduled to release second-quarter fiscal 2024 earnings on May 1. The Zacks Consensus Estimate for earnings is pegged at $2.30 per share, suggesting growth of 7% from the year-ago reported figure.
Qualcomm has a long-term earnings growth expectation of 9.5%. QCOM delivered an average earnings surprise of 5.9% in the last four reported quarters.
Qorvo Inc. (QRVO - Free Report) is slated to release fourth-quarter fiscal 2024 earnings on May 1. The Zacks Consensus Estimate for earnings is pegged at $1.21 per share, indicating stellar growth of 365.4% from the year-ago reported figure.
Qorvo has a long-term earnings growth expectation of 19.4%. QRVO delivered an average earnings surprise of 76.4% in the last four reported quarters.
Motorola Solutions Inc. (MSI - Free Report) is due to release first-quarter 2024 earnings on May 2. The Zacks Consensus Estimate for earnings is pegged at $2.52 per share, implying a rise of 13.5% from the year-ago reported figure.
Motorola has a long-term earnings growth expectation of 9.2%. MSI delivered an average earnings surprise of 6.6% in the last four reported quarters.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
T-Mobile's (TMUS) Q1 Earnings Top on Industry-Leading Growth
T-Mobile US, Inc. (TMUS - Free Report) reported mixed first-quarter 2024 results, with the bottom line beating the Zacks Consensus Estimate but the top line missing the same.
The Bellevue, WA-based wireless service provider reported industry-leading postpaid customer growth with a record low churn rate. T-Mobile follows a multi-layer approach to 5G with dedicated standalone 5G deployed nationwide across 600MHz, 1.9GHz, and 2.5GHz bands.
Net Income
Net income in the first quarter was $2,374 million or $2.00 per share, up from $1,940 million or $1.58 per share in the year-ago quarter. The 22.4% year-over-year growth was primarily driven by lower operating expenses. The bottom line exceeded the Zacks Consensus Estimate of $1.83.
T-Mobile US, Inc. Price, Consensus and EPS Surprise
T-Mobile US, Inc. price-consensus-eps-surprise-chart | T-Mobile US, Inc. Quote
Revenues
Net sales during the quarter were $19,594 million, marginally down from $19,632 million in the year-ago quarter, as solid growth in service revenue was more than offset by declining equipment sales. The top line missed the consensus estimate of $19,637 million.
Segment Results
Total Service revenues were $16,096 million, up from $15,546 million in the year-ago quarter. The segment sales missed our revenue estimate of $16,203.5 million. The 3.5% year-over-year growth was primarily driven by solid demand for postpaid services. Net sales from Postpaid Services contributed $12,631 million in revenues, up 6.5% year over year.
During the quarter, T-Mobile added 1.2 million postpaid net customers, while postpaid net account additions were 218,000 – both metrics being the best in the industry. Postpaid phone net customer additions were 532,000, the best in the industry. Postpaid phone churn rate was 0.86%, equaling the lowest for the quarter in the company’s history. High-speed Internet net customer additions were 405,000. Postpaid average revenues per account rose to $140.88 from $138.04 in the year-ago quarter.
Net sales from Prepaid services were $2,403 million, marginally down from $2,417 million in the year-earlier quarter. Prepaid net customer losses were 48,000 with a churn rate of 2.75%. Wholesale and other service revenues decreased to $1,062 million from $1,267 million in the year-earlier quarter. Prepaid ARPU (average revenues per user) declined to $37.18 from $37.98 in the year-ago quarter.
Equipment revenues were $3,251 million, down from $3,719 million in the prior year. The segment revenues beat our estimate of $3,140 million. Lower postpaid upgrades, driven by longer device lifecycles, led to a lower number of devices and accessories sold. Lower sales of prepaid and Assurance Wireless devices also adversely impacted the top line in this vertical.
Other revenues were $247 million, down from the prior-year quarter’s tally of $367 million.
Other Details
Total operating expenses declined to $15,596 million from $16,235 million in the year-ago quarter. Consequently, operating income rose to $3,998 million from $3,397 million. T-Mobile recorded core adjusted EBITDA of $7,617 million compared with $7,052 million a year ago, backed by solid growth in service revenues.
Cash Flow & Liquidity
In the March quarter, T-Mobile generated $5,084 million of cash from operating activities compared with $4,051 million in the prior-year quarter. Adjusted free cash flow was $3,347 million, up from $2,401 million in the year-earlier quarter. The growth was driven by improvement in operating cash flow and lower cash purchases of property and equipment.
As of Mar 31, 2024, the company had $6,708 million in cash and cash equivalents, with $71,361 million of long-term debt. During the quarter, it repurchased 21.9 million shares for $3.6 billion.
Guidance Up
With improved operating metrics, the company presently expects postpaid net customer additions to be between 5.2 million and 5.6 million, up from 5 million and 5.5 million expected earlier. Core adjusted EBITDA is estimated to be $31.4-$31.9 billion. It anticipates cash from operating activities within $21.6-$22.3 billion. TMUS expects adjusted free cash flow in the band of $16.4-$16.9 billion. Capital expenditure is projected to be in the range of $8.6-$9.4 billion.
Zacks Rank
T-Mobile currently has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Qualcomm Incorporated (QCOM - Free Report) is scheduled to release second-quarter fiscal 2024 earnings on May 1. The Zacks Consensus Estimate for earnings is pegged at $2.30 per share, suggesting growth of 7% from the year-ago reported figure.
Qualcomm has a long-term earnings growth expectation of 9.5%. QCOM delivered an average earnings surprise of 5.9% in the last four reported quarters.
Qorvo Inc. (QRVO - Free Report) is slated to release fourth-quarter fiscal 2024 earnings on May 1. The Zacks Consensus Estimate for earnings is pegged at $1.21 per share, indicating stellar growth of 365.4% from the year-ago reported figure.
Qorvo has a long-term earnings growth expectation of 19.4%. QRVO delivered an average earnings surprise of 76.4% in the last four reported quarters.
Motorola Solutions Inc. (MSI - Free Report) is due to release first-quarter 2024 earnings on May 2. The Zacks Consensus Estimate for earnings is pegged at $2.52 per share, implying a rise of 13.5% from the year-ago reported figure.
Motorola has a long-term earnings growth expectation of 9.2%. MSI delivered an average earnings surprise of 6.6% in the last four reported quarters.