TMUS · Q1 2026 Earnings

Bullish

T-Mobile US

Reported April 28, 2026

30-second summary

T-Mobile opened FY2026 with $23.11B Q1 revenue (+10.6% YoY), $4.60B Q1 FCF, and Core Adjusted EBITDA of $9.24B at a 49.1% margin — and raised four FY26 guides just one quarter in (postpaid net account adds, Core Adj. EBITDA, operating cash flow, and Adjusted FCF). Postpaid net account additions guide moved to 950K–1.05M (from 900K–1.0M), Core Adj. EBITDA to $37.1–37.5B (from $37.0–37.5B), Net cash from operations to $28.1–28.7B (from $28.0–28.7B), and Adjusted FCF to $18.1–18.7B (from $18.0–18.7B). Postpaid account churn — already disclosed in prior quarters' supplementary data — printed at 1.04%, flat sequentially and +10bps YoY (vs. 0.94% Q1 FY25), and management framed Q2 with a +9% YoY service revenue guide implying ~$19B — accelerating from the 8% FY pace.

Headline numbers

EPS

Q1 FY2026

$2.27

Revenue

Q1 FY2026

$23.11B

+10.6% YoY

Free cash flow

Q1 FY2026

$4.60B

Operating margin

Q1 FY2026

19.5%

Key financials

Q1 FY2026

Metric	Q1 FY2026	YoY	Q4 FY2025	QoQ
Revenue	$23.11B	+10.6%	$24.33B	-5.0%
EPS	$2.27	—	$1.88	+20.7%
Operating margin	19.5%	—	15.4%	+410bps
Free cash flow	$4.60B	—	$4.18B	+9.9%

Guidance

T-Mobile raised full-year postpaid net additions, core adjusted EBITDA, and adjusted free cash flow guidance; Q1 revenue and EBITDA beat/met prior expectations; strong momentum into Q2 with 9% service revenue YoY growth guidance.

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Service Revenue	Q1 FY2026	Not explicitly quantified in prior guidance	$18.827 billion	+10.6% YoY (vs prior guide of low-to-mid single digit implied growth)	Beat
Core Adjusted EBITDA	Q1 FY2026	Not explicitly quantified in prior guidance	$9,240 million	in-line with implied quarterly cadence from FY guide	Met

New guidance

Metric	Period	Guide	YoY
Service Revenue YoY Growth	Q2 FY2026	9%	—
Core Adjusted EBITDA	Q2 FY2026	$9.4 billion	+10% YoY

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Postpaid Net Account Additions	FY 2026	900 thousand to 1.0 million	950 thousand to 1,050 thousand	+50k at low end; +50k at high end; midpoint +50k	Raised
Core Adjusted EBITDA	FY 2026	$37.0 to $37.5 billion	$37.1 to $37.5 billion	+$100M at low end	Raised
Adjusted Free Cash Flow	FY 2026	$18.0 to $18.7 billion	$18.1 to $18.7 billion	+$100M at low end	Raised

Reaffirmed unchanged this quarter: Capital Expenditures (approximately $10 billion), Service Revenue YoY Growth (8%), Postpaid ARPA Growth (2.5% to 3%)

Segment performance

Q1 FY2026

Segment	Q1 FY2026	YoY
Postpaid Service Revenues	$15.629B	+15.0%
Prepaid Service Revenues	$2.517B	-4.8%
Equipment Revenues	$3.996B	+7.9%
Wholesale and Other Service Revenues	$0.685B	-0.4%

Platform metrics

Q1 FY2026

Segment	Q1 FY2026
Total Postpaid Accounts	34,439 thousand
Postpaid Net Account Additions	217 thousand
Postpaid ARPA	$151.93
Postpaid Account Churn	1.04%

Profitability

Q1 FY2026

Segment	Q1 FY2026
Core Adjusted EBITDA	$9,240 million
Core Adjusted EBITDA Margin	49.1%
Adjusted Free Cash Flow Margin	24.4%
Net Debt to LTM Core Adjusted EBITDA	2.4x

Management tone

Narrative arc: Network defense → Offensive repositioning → Inflection point → Capacity expansion → Ecosystem reframing

Network leadership has moved from "validated fact" to the single biggest reason customers switch — and management is now treating it as an unprecedented growth lever rather than a defended position. From the call: "amongst recent switchers who chose to come to T-Mobile from another carrier, the highest percentage ever said they chose us for one reason, network quality." The shift signals the network thesis has crossed from internal claim to external buying behavior — and Srini explicitly tied it to "unprecedented growth opportunities."

FWA has compounded from "fastest growing ISP" rhetoric to multi-source third-party validation. This quarter management stacks the external benchmarks: "For yet another quarter, we were the fastest growing ISP in America…topping JD Power, Forbes, CNET, Consumer Reports, and OpenSignal." The 15M-by-2030 target was reiterated in Q&A with detailed capacity-planning support ("36 million hexagons analyzed") that suggests management is preparing to defend the number against bear skepticism.

AI has moved from network-operations efficiency to physical-AI partnership and edge inferencing as a new revenue category. This quarter management announced Figure AI as a signed partner and framed edge compute on the 5G Advanced footprint as an architectural advantage competitors can't replicate near-term. From the call: "we're connecting our 5G advanced network to Figure AI's F3 humanoid robots…This is an important stepping stone towards building an even more capable network of the future with 6G." The framing matters because the FY26 guide explicitly excludes contribution from edge AI, T-Ads, and satellite — yet management is now publicly signing partners that could appear in 2027 numbers.

Guidance posture has shifted from "pre-commit raises on the year-end call" to delivering them one quarter into the year. This quarter — only one quarter into FY26 — management raised four of the FY26 guides. The cadence of raises now resembles the FY25 pattern, suggesting management has set FY26 with deliberate conservatism. From the call: "we are raising our expectation for total postpaid net account additions to be between 950,000 and 1,050,000 on the strength of the underlying momentum in the business."

Competitive framing has crossed from share-take to industry-reshaping, with explicit comparison gaps. Mike Sievert positioned the gap as quantified and widening — net promoter score 45, "over 20% higher than that of our next closest competitor" — and management openly contrasted Verizon (-127K postpaid accounts, -2% ARPA) and AT&T (highest postpaid phone churn increase in industry) in Q&A. The tone has moved from "we will keep taking share" to "we are reshaping the industry while peers go backward."

Recurring themes management leaned on this quarter:

Network superiority as primary switching driverWidening competitive differentiation across network, value, and experience5G broadband as fastest-growing ISP with industry-leading customer satisfactionAI-native network capabilities and physical AI partnershipsPostpaid ARPA growth from pricing power and customer deepeningCapital efficiency via JV partnerships for fiber expansion

Risks management surfaced:

Forward-looking statements involve risks and uncertaintiesCompetitive dynamics in network quality perceptionCapital intensity of broadband expansionMarket saturation in top 100 cities requiring rural market accelerationExecution risk on AI network capabilities rollout

Q&A highlights

John Hudlick · UBS

Competition in postpaid market with reduced handset subsidies and outlook on fixed wireless broadband runway and potential network constraints

Management emphasized differentiation beyond subsidies through best network, best value, best experience positioning. Noted 6% account growth and near 4% ARPA growth. On broadband, expressed confidence in 15M customer target by 2030 based on detailed capacity planning accounting for 36M hexagons, fallow capacity, and market share assumptions, with no need for additional spectrum or 6G assumptions. Network capacity tracking strong with improving NPS, speeds, and 80% customer growth in 3 years.

15 million FWA customers projected by 203036 million hexagons analyzed for capacity planning6% postpaid account growth YoY3.9% ARPA growth YoY

Sean Diffley · Morgan Stanley

Edge inferencing opportunity with Figure AI deal, competitive differentiation versus peers, technology advantages, and business model sizing

Management explained edge AI opportunity driven by fallow compute capacity at network edge combined with low latency critical for physical AI and robotics. Highlighted 5G Advanced nationwide rollout as unique advantage with innovations in uplink (transmit switching, higher power, MIMO) not matched by competitors, providing multi-year advantage. Acknowledged market sizing is preliminary but all estimates show very large opportunity. AI already embedded in network operations for self-healing, antenna optimization.

5G Advanced nationwide rollout unique to T-MobileUplink innovations: transmit switching, higher transmit power, uplink MIMOFallow compute created from AI build-out at edgeLow latency essential for robotics and physical AI

Michael Rollins · Citi

ARPA growth contributors (price, upselling, lines per account, broadband) and postpaid account churn trends year-over-year and through the quarter

Management attributed 3.9% ARPA growth to multiple factors: rate plan optimizations, lines per account growth across all categories, over 60% of new account lines on premium tier plans, and value-added services. Explained postpaid account churn methodology: higher than line churn due to higher weighting of new and broadband-only customers in account base (both churn above average). Line churn up only 3 bps YoY and stable. Noted January was competitive quarter but March and April showed cooling.

3.9% ARPA growth YoY in Q1Over 60% of new account lines on premium tier plansPostpaid account churn higher than line churn by definition (new and broadband customers weight)Postpaid phone line churn up 3 bps YoY

Peter Sopino · Wolf Research

Rising equipment sales losses year-over-year and rolling four-quarter trends; understanding if positive ARPA growth should continue trend

Management attributed equipment cost increases to higher customer base generating same upgrade/acquisition rates, resulting in larger absolute dollars. Noted device promotions designed around premium plans driving ARPA increases. Emphasized must view holistically: Q1 showed 217K postpaid account additions and 3.9% ARPA growth drove 11% service revenue growth (4x competitors). Contrasted with Verizon (lost 127K accounts, -2% ARPA) and AT&T (highest churn increase, declining ARPU). Stressed investment in network differentiation drives value creation beyond device equation.

217,000 postpaid account net additions YoY3.9% ARPA growth in Q111% service revenue growth (4x nearest competitor)12% core EBITDA growth

Kanan Venkateshwar · Barclays

Broadband business model trade-offs (capital efficiency vs. JV management inefficiencies), economics clarity, and path to larger scaled deals versus piecemeal JV growth

Management rejected pursuit of scale for scale's sake in fiber. Emphasized scale in fiber comes from national brand plus local scale (zoning, permitting, local expertise differ by geography). Not interested in pure homes-passed deals or mixed ILEC deals; focused on first-to-fiber strategy. On JV efficiencies: T-Mobile handles retail/consumer, common IT platform across JVs, leveraging scale where meaningful (distribution, brand, IT) while respecting local knowledge needs. Explicitly stated not interested in cable consolidation; positioning as attacker of incumbents rather than becoming incumbent.

$2.7 billion investment across two new JVs at closeFirst-to-fiber focus; selective on non-first-to-fiber segmentsNot pursuing cable acquisitionsPure-play fiber assets required

Answers to last quarter's watch list

Q1 2026 postpaid churn trajectory. Resolved positively. Line-level postpaid phone churn was up only 3bps YoY per management's Q&A disclosure, with January characterized as the most competitive month and March/April cooling. Postpaid account churn printed at 1.04%, flat sequentially vs. Q4 FY25 (1.04%) and +10bps YoY vs. Q1 FY25 (0.94%).

Resolved positively

FY26 Core Adjusted EBITDA quarterly cadence vs. the $37.0–37.5B guide. The Q1 print of $9.24B against a raised $37.1–37.5B FY guide implies a $9.3–9.4B quarterly average for the remaining three quarters — broadly consistent with the explicit Q2 ~$9.4B guide. The Q1 raise of $50M at midpoint is deliberately small, consistent with the FY25 playbook of raising in measured increments. A mid-year raise on the Q2 call now looks likely if Q2 prints at or above the $9.4B forward guide.

Resolved positively

Account-level churn YoY comparability. Resolved. Postpaid account churn 1.04% in Q1 FY2026, +10bps YoY vs. 0.94% in Q1 FY25 and flat sequentially vs. Q4 FY25's 1.04%. Management's Q&A characterization explained the methodology — account churn is structurally higher than line churn because new and broadband-only customers (both above-average churn populations) are weighted more heavily in the account base. Competitor comparability was deflected.

Resolved positively

FY26 Adjusted FCF $18.1–18.7B against the tax-rate headwind. Q1 FCF of $4.60B and a $50M midpoint raise (now $18.1–18.7B) suggest 1H delivery is tracking toward the middle-to-high end of the band, but the high end was reaffirmed rather than raised — implying the tax-rate headwind is fully reflected in the FY framework. Capex was reaffirmed at ~$10B; effective tax rate reaffirmed at 25–26%. Status: Continue monitoring — 2H working capital and capex pacing will determine where in the $18.1–18.7B band the year lands.

Any FY26 service revenue growth disclosure or implied figure. Resolved. Management reaffirmed ~$77B FY service revenue and +8% YoY growth, and added a Q2 forward guide of +9% YoY (~$19B). Postpaid service revenue grew 15% YoY in Q1; total service revenue grew 11.3% YoY. The reaffirmed 8% FY guide against accelerating quarterly cadence reads as deliberately conservative versus underlying run-rate.

Resolved positively

What to watch into next quarter

Q2 service revenue vs. the ~$19B / +9% YoY explicit guide. The first forward next-quarter guide since the framework reset — a print materially above $19B would mark the second consecutive quarter of accelerating service revenue growth and increase pressure to raise the reaffirmed 8% FY guide.

Q2 Core Adjusted EBITDA vs. the ~$9.4B / +10% YoY guide and whether the FY $37.1–37.5B band gets a more meaningful raise on the Q2 call. The Q1 $50M midpoint raise was deliberately small; a Q2 print materially above $9.4B would set up a mid-year FY guide raise of greater magnitude.

Postpaid account churn trajectory at the 1.04% Q1 baseline. Watch whether the metric trends up, down, or flat through 2026 seasonal patterns — and whether T-Mobile begins quantifying its account-churn gap vs. AT&T's reported account-level metric.

Postpaid net account adds run-rate. The Q1 217K print annualizes to 868K — below the low end of the raised 950K–1.05M FY guide. Q2 typically runs hotter than Q1 seasonally; watch whether the cumulative 1H total tracks above 425K to keep the FY guide credible without a 2H back-end load.

DT merger-rumor governance. Craig Moffett's question elicited the explicit "majority of the minority" disclosure. Any follow-up filings, board-process disclosures, or DT-side commentary become material near-term watch items.

Any monetization disclosure on the Figure AI partnership or edge-AI revenue framework. Management framed edge compute and physical AI as 2027+ optionality not in the FY26 guide, but the Figure AI signing is the first concrete partner — early disclosure on contract structure, revenue model, or expansion partners would meaningfully expand the bull case beyond core telecom.

Sources

T-Mobile US Q1 FY2026 press release / Form 8-K Exhibit 99.2 — https://www.sec.gov/Archives/edgar/data/1283699/000128369926000062/tmus03312026ex992.htm
T-Mobile US Q1 FY2026 earnings call commentary (management prepared remarks and Q&A).

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