T-Mobile Q1 2025 slides: Industry-leading growth continues with raised guidance

T-Mobile US Inc (NASDAQ:TMUS) released its Q1 2025 investor factbook on April 24, 2025, showcasing continued strong performance across key metrics and raising its financial guidance for the full year. The wireless carrier reported significant growth in customer additions, revenue, and profitability while maintaining its industry leadership position.

Quarterly Performance Highlights

T-Mobile reported net income of $3.0 billion for Q1 2025, representing a 24% year-over-year increase, with diluted earnings per share growing 29% to $2.58 compared to $2.00 in Q1 2024. The company’s service revenues reached $16.9 billion, up 5% year-over-year, driven primarily by an 8% increase in postpaid service revenue.

As shown in the following highlights summary, T-Mobile maintained its industry leadership position across multiple metrics:

Core Adjusted EBITDA grew 8% year-over-year to $8.3 billion, while adjusted free cash flow increased 31% to $4.4 billion, representing an industry-leading margin of 26%. Net cash provided by operating activities surged 35% to $6.8 billion.

"Our Q1 results demonstrate T-Mobile’s continued momentum in delivering profitable growth," the company stated in its presentation, highlighting its network leadership position backed by Opensignal and RootMetrics awards for download speed experience and 5G availability.

Customer Growth and Revenue Analysis

T-Mobile continued to lead the industry in customer acquisition, adding 1.3 million postpaid net customers in Q1 2025, which it described as its "best ever Q1" for this metric. The company also added 205,000 postpaid net accounts, maintaining its industry-leading position.

The following chart illustrates T-Mobile’s consistent growth in postpaid accounts and average revenue per account (ARPA):

Total (EPA:TTEF) postpaid accounts increased from 30,015,000 in Q1 2024 to 31,099,000 in Q1 2025. Postpaid ARPA grew 4% year-over-year to $146.22, driven by an increase in customers per account and higher premium services. Postpaid phone ARPU also increased by 1% year-over-year to $49.38.

T-Mobile’s total postpaid customer base expanded to 105,455,000, up from 99,272,000 in Q1 2024, as shown in the following chart:

Postpaid phone churn remained relatively stable at 0.91% in Q1 2025 compared to 0.89% in Q1 2024, though it showed improvement from the 0.92% reported in Q4 2024.

The company’s high-speed internet business continued to show robust growth, with 424,000 net customer additions in Q1 2025. Total high-speed internet customers increased to 6,854,000, up from 5,181,000 in Q1 2024, representing a 32% year-over-year growth.

Financial Performance Details

Service revenues, which grew 5% year-over-year to $16.9 billion, were primarily driven by an 8% increase in postpaid service revenues, as illustrated in the following chart:

Core Adjusted EBITDA of $8.3 billion represented a strong 8% year-over-year growth, while net cash provided by operating activities surged 35% to $6.8 billion, demonstrating the company’s improved operational efficiency.

Adjusted free cash flow increased 31% year-over-year to $4.4 billion, despite a slight increase in cash purchases of property and equipment. This growth was primarily attributed to higher net cash provided by operating activities.

Capital Structure and Shareholder Returns

T-Mobile’s net debt (excluding tower obligations) stood at $76.0 billion as of Q1 2025, slightly higher than the $73.9 billion reported in Q1 2024. The company continued its strong focus on shareholder returns, with significant stock repurchases and dividend payments during the quarter.

During Q1 2025, T-Mobile repurchased 10.1 million shares for approximately $2.5 billion as part of its $14.0 billion stockholder return program announced in December 2024, which runs through December 31, 2025. Additionally, the company paid a cash dividend of $0.88 per share, totaling approximately $1.0 billion, on March 13, 2025.

2025 Outlook and Guidance

In a sign of confidence in its continued momentum, T-Mobile raised its 2025 financial guidance for several key metrics, as shown in the following outlook table:

The company maintained its guidance for postpaid net customer additions at 5.5 to 6.0 million for the full year. However, it increased its Core Adjusted EBITDA guidance by $100 million to a range of $33.2 to $33.7 billion. Similarly, the guidance for net cash provided by operating activities was raised by $100 million to $27.0 to $27.5 billion, and Adjusted Free Cash Flow guidance was increased by $100 million to $17.5 to $18.0 billion.

Capital expenditures are expected to remain at approximately $9.5 billion for the year, unchanged from previous guidance.

Market Reaction and Conclusion

Despite the strong Q1 2025 results and raised guidance, T-Mobile’s stock faced pressure in after-hours trading on April 24, 2025, dropping 5.03% to $249 after closing the regular session at $259.35, up 1.09% for the day. This reaction came despite the company’s continued industry-leading performance across multiple metrics.

The stock has traded in a 52-week range of $160.62 to $276.49, reflecting significant appreciation over the past year despite the after-hours pullback following the Q1 results.

T-Mobile’s Q1 2025 performance continues to build on its strong results from Q4 2024, when it reported its "greatest growth year ever." The company’s focus on "thoughtful, smart and profitable growth" rather than "growth for growth’s sake," as emphasized in previous earnings calls, appears to be yielding positive financial results while maintaining industry leadership in customer acquisition.

Full presentation:

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