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What changed in T-Mobile US's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of T-Mobile US's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+389 added−387 removedSource: 10-K (2025-01-31) vs 10-K (2024-02-02)

Top changes in T-Mobile US's 2024 10-K

389 paragraphs added · 387 removed · 257 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe are reducing our carbon footprint through several initiatives, including: • Making progress on our science-based net-zero target for 2040 that includes Scope 1, 2 and 3 emissions; • Investing in renewable energy, as evidenced by our RE100 pledge, a global initiative that unites businesses committed to 100% renewable electricity.
Biggest changeEnvironmental Sustainability Efficiencies and Reducing Our Carbon Footprint We are actively working to identify efficiencies in our energy usage and reduce our environmental impact by: • Pursuing a science-based net-zero emissions target for 2040, covering Scope 1, 2, and 3 emissions; • Investing in renewable energy, meeting our RE100 pledge since 2021, through initiatives such as Virtual Power Purchasing Agreements and clean energy projects producing over 3.4 million megawatt hours annually; • Enhancing energy efficiency in our facilities, including retail stores, data centers, and cell sites; and • Promoting a circular economy through a robust device reuse and recycling program.
Responsible Sourcing We believe our suppliers are a valuable extension of our business and corporate values. Our Supplier Code of Conduct outlines expectations around ethical business practices for our suppliers. We require our suppliers to operate in full compliance with the laws, rules, regulations and ethical standards of the countries in which they operate or provide products or services.
Responsible Sourcing We believe our suppliers are a valuable extension of our business and corporate values. Our Supplier Code of Conduct outlines expectations around ethical business practices for our suppliers. We require our suppliers to operate in compliance with the laws, rules, regulations and ethical standards of the countries in which they operate or provide products or services.
Competition The wireless communications services industry remains competitive. We are the second largest provider of wireless communications services in the U.S. as measured by our total postpaid and prepaid customers. Our competitors include other carriers, such as AT&T Inc. (“AT&T”), Verizon Communications, Inc. (“Verizon”), and DISH as it continues to grow its network.
Competition The wireless communications services industry remains competitive. We are the second largest provider of wireless communications services in the U.S. as measured by our total postpaid and prepaid customers. Our wireless communications services competitors include other carriers, such as AT&T Inc. (“AT&T”), Verizon Communications, Inc. (“Verizon”), and DISH Network Corporation (“DISH”) as it continues to grow its network.
We serve consumers as well as business customers, who are provided services under the T-Mobile for Business brand. • Prepaid customers generally pay for wireless communications services in advance. We serve prepaid customers under the T-Mobile and Metro by T-Mobile brands. We provide Machine-to-Machine (“M2M”) and Mobile Virtual Network Operator (“MVNO”) customers access to our network.
We serve consumers as well as business customers, who are provided services under the T-Mobile for Business brand. • Prepaid customers generally pay for wireless communications services in advance. We serve prepaid customers under the T-Mobile, Metro by T-Mobile, Mint Mobile and Ultra Mobile brands. We provide Machine-to-Machine (“M2M”) and Mobile Virtual Network Operator (“MVNO”) customers access to our network.
On April 27, 2020, the FCC lifted the restriction on who can hold EBS licenses and the 30-year limitation on lease duration, among other changes. The elimination of these restrictions allows current license holders to sell their licenses, including to T-Mobile.
In April 2020, the FCC lifted the restriction on who can hold EBS licenses and the 30-year limitation on lease duration, among other changes. The elimination of these restrictions allows current license holders to sell their licenses, including to T-Mobile.
We provide services, devices and accessories across our flagship brands, T-Mobile and Metro by T-Mobile, through our owned and operated retail stores, as well as through our websites (www.t-mobile.com and www.metrobyt-mobile.com), T-Mobile and Metro by T-Mobile apps, customer care channels and through national retailers.
We provide services, devices and accessories across our flagship brands, T-Mobile, Metro by T-Mobile and Mint Mobile, through our T-Mobile and Metro by T-Mobile owned and operated retail stores, as well as through our websites (www.t-mobile.com, www.metrobyt-mobile.com and www.mintmobile.com), T-Mobile, Metro by T-Mobile and Mint Mobile apps, customer care channels and through national retailers.
Substantially all of our revenues for the years ended December 31, 2023, 2022 and 2021, were earned in the United States, including Puerto Rico and the U.S. Virgin Islands.
Substantially all of our revenues for the years ended December 31, 2024, 2023 and 2022, were earned in the United States, including Puerto Rico and the U.S. Virgin Islands.
While a majority of our leases have contractual provisions enabling us to match offers, we may be forced to compete with others to purchase 2.5 GHz licenses on the secondary market 10 Table of Contents and expend additional capital earlier than we may have anticipated.
While a majority of our leases have contractual provisions enabling us to match offers, we may be forced to compete with others to purchase 2.5 GHz licenses on the secondary market and expend additional capital earlier than we may have anticipated.
Our fixed wireless product is available to millions of domestic households where we currently have excess network capacity, providing, for some consumers, an alternative to traditional landline internet service providers and expanding access to and choice for some consumers.
Our fixed wireless product is available to tens of millions of domestic households where we currently have excess network capacity, providing, for some consumers, an alternative to traditional landline internet or broadband service providers and expanding access to and choice for some consumers.
We expect 9 Table of Contents our suppliers to share our commitment to ethical conduct and environmentally responsible business practices while they conduct business with or on behalf of us. Our Responsible Sourcing Policy further outlines T-Mobile’s expectations in this area.
We expect our suppliers to share our commitment to ethical conduct and environmentally responsible business practices while they conduct business with or on behalf of us. Our Responsible Sourcing Policy further outlines T-Mobile’s expectations in this area.
By strategically investing in the following three key areas of career development and learning, we are developing our talent now and for the future. • Evolve skills and careers – Learn every day, champion relentless improvement, develop critical skills, explore career possibilities, and build the desired career; • Advance leadership expertise – Build critical leadership capabilities, enable leadership growth at all levels, and develop skills to lead in the future; and • Champion diversity, equity and inclusion (“DE&I”) – Promote inclusive habits and behaviors, enhance belonging and connectedness, and advocate for equitable opportunities.
By strategically investing in the following three key areas of career development and learning, we are developing our talent now and for the future. • Evolve skills and careers – Learn every day, champion relentless improvement, develop critical skills, explore career possibilities, and build the desired career; • Advance leadership expertise – Build critical leadership capabilities, enable leadership growth at all levels, and develop skills to lead in the future; and • Champion belonging and inclusion – Promote inclusive habits and behaviors and enhance belonging and connectedness.
Notwithstanding this federal preemption, several states are considering or have passed laws or regulations that could potentially set prices, minimum performance standards and/or restrictions on service discontinuation that could impact our business in those states.
Notwithstanding this federal preemption, several states are considering or have passed laws or regulations 11 Table of Contents that could potentially set prices, minimum performance standards and/or restrictions on service discontinuation that could impact our business in those states.
The FCC’s RIF Order expressly preempted such state efforts, which are inconsistent with the FCC’s federal deregulatory approach. In 2019, however, the DC Circuit issued a ruling largely upholding the RIF Order, but also vacating the portion of the ruling broadly preempting state/local measures regulating broadband services.
The FCC’s RIF Order expressly preempted such state efforts, which were inconsistent with the FCC’s federal deregulatory approach at that time. In 2019, however, the DC Circuit issued a ruling largely upholding the RIF Order but also vacating the portion of the ruling broadly preempting state/local measures regulating broadband services.
Network Strategy Utilizing our multilayer spectrum portfolio, our mission is to become “Famous for Network.” We have deployed low-band, mid-band and mmWave spectrum dedicated for 5G across our dense and broad network to create what we believe is America’s largest, fastest, most awarded and most advanced 5G network. The Merger greatly enhanced our spectrum position.
Network Strategy Utilizing our multilayer spectrum portfolio, our mission is to become “Famous for Network.” We have deployed low-band, mid-band and mmWave spectrum dedicated for 5G across our dense and broad network to create what we believe is America’s largest, fastest, most awarded and most advanced 5G network.
Our “layer cake” of spectrum provides an unmatched 5G and overall network experience to our customers, which consists of our foundational layer of low-band, our mid-band and our millimeter-wave (“mmWave”) spectrum licenses (see “Spectrum Position” below).
Our dense and multi-layer network provides an unmatched 5G and overall network experience to our customers, which consists of our foundational layer of low-band, our mid-band and our millimeter-wave (“mmWave”) spectrum licenses (see “Spectrum Position” below).
The information on our website is not part of this or any other report we file with, or furnish to, the SEC. 11 Table of Contents
The information on our website is not part of this or any other report we file with, or furnish to, the SEC.
In addition, following the FCC’s adoption of the 2017 Restoring Internet Freedom (“RIF”) Order reclassifying broadband internet access services as non-common carrier “information services”, a number of states have sought to impose state-specific net neutrality, rate-setting, and privacy requirements on providers’ broadband services.
For example, following the FCC’s adoption of the 2017 Restoring Internet Freedom (“RIF”) Order reclassifying broadband internet access services as non-common carrier “information services,” a number of states sought to impose state-specific net neutrality, rate-setting, and privacy requirements on providers’ broadband services.
Our Operations As of December 31, 2023, we provide wireless communications services to 119.7 million postpaid and prepaid customers and generate revenue by providing affordable wireless communications services to these customers, as well as a wide selection of wireless devices and accessories.
Our Operations As of December 31, 2024, we provide wireless communications services to 129.5 million postpaid and prepaid customers and generate revenue by providing affordable wireless communications services to these customers, as well as a wide selection of wireless devices and accessories.
Our ability to attract and retain postpaid and prepaid customers is important to our business in the generation of service revenues, equipment revenues and other revenues. In 2023, our service revenues generated by providing wireless communications services by customer category were: • 77% Postpaid customers; • 15% Prepaid customers; and • 8% Wholesale and other services.
Our ability to attract and retain postpaid and prepaid customers is important to our business in the generation of service revenues, equipment revenues and other revenues. In 2024, our service revenues generated by providing wireless communications services by customer category were: • 79% Postpaid customers; • 16% Prepaid customers; and • 5% Wholesale and other services.
Regulation The FCC regulates many key aspects of our business, including licensing, construction, the operation and use of our network, modifications of our network, control and ownership of our licenses and authorizations, the sale, transfer and acquisition of certain licenses, domestic roaming arrangements and interconnection agreements, pursuant to its authority under the Communications Act of 1934, as amended (“Communications Act”).
Our TPRM process also continuously monitors current suppliers for policy violations and risks. 10 Table of Contents Regulation The FCC regulates many key aspects of our business, including licensing, construction, the operation and use of our network, modifications of our network, control and ownership of our licenses and authorizations, the sale, transfer and acquisition of certain licenses, domestic roaming arrangements and interconnection agreements, pursuant to its authority under the Communications Act of 1934, as amended (“Communications Act”).
We employ a third-party risk management (“TPRM”) process to screen for anti-corruption, global sanctions, human rights and environmental risks before engaging with a supplier. Our TPRM process also continuously monitors current suppliers for policy violations and risks.
We employ a third-party risk management (“TPRM”) process to screen for anti-corruption, global sanctions, human rights and environmental risks before engaging with a supplier.
Attraction and Retention We employ a highly skilled workforce within a broad range of functions. Substantially all of our employees are located throughout the United States, including Puerto Rico, to serve our nationwide network and retail operations. Our headquarters are located in Bellevue, Washington, and Overland Park, Kansas.
Substantially all of our employees are located throughout the United States, including Puerto Rico, to serve our nationwide network and retail operations. Our headquarters are located in Bellevue, Washington, and Overland Park, Kansas.
This spectrum is comprised of: • An average of 40 MHz in the 600 MHz band; • An average of 10 MHz in the 700 MHz band; • An average of 14 MHz in the 800 MHz band; • An average of 41 MHz in the 1700 MHz AWS band; • An average of 66 MHz in the 1900 MHz PCS band; • An average of 182 MHz in the 2.5 GHz band; • An average of 12 MHz in the 3.45 GHz band; and • An average of 27 MHz in the C-band. • We controlled an average of 1,157 GHz of combined mmWave spectrum licenses. • In August 2022, we entered into license purchase agreements pursuant to which we will acquire spectrum in the 600 MHz band in exchange for total cash consideration of $3.5 billion.
This spectrum is comprised of: • An average of 41 MHz in the 600 MHz band; • An average of 10 MHz in the 700 MHz band; • An average of 14 MHz in the 800 MHz band; • An average of 41 MHz in the 1700 MHz AWS band; • An average of 66 MHz in the 1900 MHz PCS band; • An average of 184 MHz in the 2.5 GHz band; • An average of 11 MHz in the 3.45 GHz band; and • An average of 27 MHz in the C-band. • We controlled an average of 1,033 GHz of combined mmWave spectrum licenses. • In September 2023, we entered into a License Purchase Agreement with Comcast Corporation and its affiliate, Comcast OTR1, LLC (together with Comcast Corporation, “Comcast”) pursuant to which we will acquire spectrum in the 600 MHz band in exchange for total cash consideration of between $1.2 billion and $3.3 billion.
The future costs to comply with all relevant regulations are, to some extent, unknown, and changes to regulations, or the applicability of regulations, could result in higher operating and capital expenses, or reduced revenues in the future.
Tower siting and construction are also subject to state and local zoning, as well as federal statutes regarding environmental and historic preservation. The future costs to comply with all relevant regulations are, to some extent, unknown, and changes to regulations, or the applicability of regulations, could result in higher operating and capital expenses, or reduced revenues in the future.
While most states pursuing net neutrality legislation are largely seeking to codify the repealed federal rules, there are differences in some states, notably California, which has passed separate privacy and net neutrality legislation, Colorado, Connecticut, Utah, Virginia, Delaware, Indiana, Iowa, Montana, Oregon, Tennessee and Texas, which have passed privacy laws; and New York, which has passed a broadband rate-setting law.
While most states pursuing net neutrality legislation sought to codify the federal rules repealed by the RIF Order, there are differences in some states. For example, California has passed separate privacy and net neutrality legislation, while many others have passed privacy laws, and New York has passed a broadband rate-setting law.
Competitive factors within the wireless communications services industry include pricing, market saturation, service and product offerings, customer experience, network investment and quality, development and deployment of technologies and regulatory changes.
Competitive factors within the wireless communications services and broadband industries include pricing, market saturation, service and product offerings, customer experience, network investment and quality, development and deployment of technologies and regulatory changes. Some of our competitors have shown a willingness to use discounted pricing or offer bundled services as a potential source of differentiation.
See Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Consolidated Financial Statements for additional details. • We plan to evaluate future spectrum purchases in future auctions and in the secondary market to further augment our current spectrum position. • As of December 31, 2023, we had equipment deployed on approximately 80,000 macro cell sites and 48,000 small cell/distributed antenna system sites across our network. 5G Leadership We believe our 5G network is America’s largest, fastest, most awarded and most advanced: • As of December 31, 2023, our Ultra Capacity 5G utilizing mid-band and mmWave spectrum covers more than 300 million people. • As of December 31, 2023, our total 5G coverage, including low-band spectrum, covers more than 330 million people, reaching 98% of Americans.
See Note 7 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Consolidated Financial Statements for additional details. • We plan to evaluate future spectrum purchases in future auctions and secondary market opportunities to further augment or refine our current spectrum position. • As of December 31, 2024, we had equipment deployed on approximately 82,000 macro cell sites and 52,000 small cell/distributed antenna system sites across our network.
State authority over wireless broadband services will remain unsettled until final action by the courts or Congress. In addition, the Federal Trade Commission (“FTC”) and other federal agencies have jurisdiction over some consumer protection matters and the elimination and prevention of anticompetitive business practices with respect to the provision of non-common carrier services.
In addition, the Federal Trade Commission (“FTC”) and other federal agencies have jurisdiction over some consumer protection matters and the elimination and prevention of anticompetitive business practices with respect to the provision of non-common carrier services. Further, the FCC and the Federal Aviation Administration regulate the siting, lighting and construction of transmitter towers and antennae.
We are inspired by a relentless focus on customer experience, consistently delivering award-winning customer experience with our “Total Experience” approach, which drives our customer satisfaction levels while enabling operational efficiencies.
We ended annual service contracts, overages, unpredictable international roaming fees and data buckets, among other things. We are inspired by a relentless focus on customer experience, consistently delivering award-winning customer experience, which drives our customer satisfaction levels while enabling operational efficiencies.
Congress and the FCC have imposed limitations on foreign ownership of CMRS licensees that exceed 20% direct ownership or 25% indirect ownership through an entity controlling the licensee. The FCC has ruled that higher levels of indirect foreign ownership, even up to 100%, are presumptively consistent with the public interest, but must be reviewed and approved.
Congress and the FCC have imposed limitations on foreign ownership of CMRS licensees. Direct foreign ownership in the licensee of more than 20% is prohibited. Indirect foreign ownership of more than 25% through an entity controlling the licensee must be reviewed and approved by the FCC as not inconsistent with the public interest.
Our most popular service plan offering is Go5G Plus, which includes unlimited talk, text and data on our network, 5G access at no extra cost, scam protection features, access to the same device offers as new customers and more.
We also offer for sale to customers a wide selection of wireless devices, including smartphones, wearables, tablets, home broadband routers and other mobile communication devices that are manufactured by various suppliers. 6 Table of Contents Our most popular service plan offering is Go5G Plus, which includes unlimited talk, text and data on our network, 5G access at no extra cost, scam protection features, access to the same device offers as new customers and more.
At the time of device purchase, qualified customers can finance all or a portion of the individual device or accessory purchase price over an installment period, generally of 24 months, using an equipment installment plan (“EIP”). 5 Table of Contents In addition to our mobile wireless communications services, we offer High Speed Internet, which includes a fixed wireless product that utilizes the excess capacity of our nationwide 5G network.
At the time of device purchase, qualified customers can finance all or a portion of the individual device or accessory purchase price over an installment period, generally of 24 months, using an equipment installment plan (“EIP”).
As a result of the Merger, we have achieved significant synergies and cost reductions by eliminating redundancies within our network, as well as through other business processes and operations. 6 Table of Contents Spectrum Position We provide wireless communications services utilizing low-band spectrum licenses covering our 600 MHz and 700 MHz spectrum, mid-band spectrum licenses, such as Advanced Wireless Services (“AWS”), Personal Communications Services (“PCS”) and 2.5 GHz spectrum, and mmWave spectrum. • We controlled, or expected to control based on previously announced auction results, an average of 392 MHz of combined low- and mid-band spectrum nationwide as of December 31, 2023.
Spectrum Position We provide wireless communications services utilizing low-band spectrum licenses covering our 600 MHz and 700 MHz spectrum, mid-band spectrum licenses, such as Advanced Wireless Services (“AWS”), Personal Communications Services (“PCS”) and 2.5 GHz spectrum, and mmWave spectrum. • We controlled an average of 394 MHz of combined low- and mid-band spectrum nationwide as of December 31, 2024.
It is all easily accessible on our Magenta U site, which is our one-stop shop for all things career development and learning. The online learning portal is designed to put employees in the driver’s seat and give them access to mentoring, training, videos, books, job search and interview tips, and much more.
We put employees in the driver’s seat and give them access to mentoring, training, videos, books, job search and interview tips, and much more.
Some of our competitors have shown a willingness to use discounted pricing or offer bundled services as a potential source of differentiation. 7 Table of Contents Human Capital Employees As of December 31, 2023, we employed approximately 67,000 full-time and part-time employees, including network, retail, administrative and customer support functions.
Human Capital Employees As of December 31, 2024, we employed approximately 70,000 full-time and part-time employees, including network, retail, administrative and customer support functions. 8 Table of Contents Attraction and Retention We employ a highly skilled workforce within a broad range of functions.
The court left open the prospect that particular state laws could still unlawfully conflict with the FCC RIF Order and be preempted; court challenges to some state enactments are pending.
The court left open the prospect that particular state laws could still unlawfully conflict with the FCC’s RIF Order and be preempted. In the meantime, the FCC sought to repeal the RIF Order through its adoption of the 2024 Open Internet Order, though the latter was struck down by a federal court of appeals in January 2025.
This includes providing added value and what we believe is an exceptional experience while implementing signature Un-carrier initiatives that have changed the wireless industry. We ended annual service contracts, overages, unpredictable international roaming fees and data buckets, among other things.
Our customers benefit from what we believe is an unmatched combination of value and network quality, unwavering focus on offering them the best possible service experience and undisputable drive for disruptive innovation in wireless and beyond. This includes providing added value and what we believe is an exceptional experience while implementing signature Un-carrier initiatives that have changed the wireless industry.
Our DE&I Employee Resource Groups include the following: • Accessibility Community at T-Mobile; • Multicultural Alliance; • Asia Pacific & Allies Network; • Black Empowerment Network; • Indigenous Peoples Network; • Magenta Latinx Network; • Multigenerational Network; • Pride; • Veterans & Allies Network; and • Women & Allies Network.
Each of these groups is open to any and all employees, and there are 38 chapters nationwide that organize volunteer opportunities and local events. 9 Table of Contents Our ERGs include: • Veterans & Allies Network; • Accessibility Community at T-Mobile; • Multicultural Alliance; • Asia Pacific & Allies Network; • Black Empowerment Network; • Indigenous Peoples Network; • Eleva Network (focused on the Latino community and allies); • Multigenerational Network; • Pride; and • Women & Allies Network.
The timing of when the licenses will be issued will be determined by the FCC after all post-auction procedures have been completed. • In September 2023, we entered into a license purchase agreement pursuant to which we will acquire spectrum in the 600 MHz band in exchange for total cash consideration of between $1.2 billion and $3.3 billion.
On January 13, 2025, we and Comcast entered into an amendment to the 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.
Services and Products We provide mobile wireless communications services through a variety of service plan options. We also offer for sale to customers a wide selection of wireless devices, including smartphones, wearables, tablets, home broadband routers and other mobile communication devices that are manufactured by various suppliers.
Services and Products We provide wireless communications services through a variety of service plan options.
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In September 2022, we entered into an agreement for the sale of the Wireline Business, and on May 1, 2023, we completed the sale of the Wireline Business. See Note 14 – Wireline for additional information.
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As part of our relentless, customer-first focus, we are transforming into an AI-enabled, data-informed, digital-first organization to continue delivering differentiated experiences to our customers.
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Integration of the spectrum and network assets acquired in the Merger was substantially completed in 2023. Our integration strategy included deploying the acquired spectrum on the combined network assets to supplement capacity, migrating Sprint customers to our network and optimizing the combined assets by decommissioning redundant sites.
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Leveraging the latest AI technology and digital capabilities, we are pioneering new approaches to serving customers with a platform to better anticipate and proactively solve their issues, offering personalized self-service options and taking authorized actions on their behalf, while simultaneously creating large-format customer experience stores for customers looking for an immersive experience, and increasing investment in domestic customer care.
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As of December 31, 2022, we had decommissioned substantially all targeted Sprint macro sites.
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Our comprehensive T-Life app will further allow us to tap into customer preferences and radically simplify customer experiences in the future.
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See Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Consolidated Financial Statements for additional details. • In September 2022, the FCC announced that we were the winning bidder of 7,156 licenses in Auction 108 (2.5 GHz spectrum) for an aggregate price of $304 million.
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In addition to our wireless communications services, we offer High Speed Internet, which includes a fixed wireless product that utilizes the excess capacity of our nationwide 5G network.
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Diversity, Equity and Inclusion DE&I have always been a part of the Un-carrier culture, and we are committed to having DE&I touch every aspect of our future.
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We believe our spectrum position and focus on technology leadership will continue to drive network differentiation.
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Our Equity in Action Plan is a five-year plan that spans the values we live by, how we invest in and provide opportunities for our employees, how we select the suppliers we do business with and how we advocate for our communities. 8 Table of Contents For our employees, we have established six DE&I Employee Resource Groups and four sub-affinity groups that have helped us establish and maintain a culture of inclusion.
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Our innovative Customer-Driven Coverage (“CDC”) approach to network investments, and leadership in deploying the latest network technologies including Massive Multiple-input/multiple-out (“Massive MIMO”), Voice over New Radio (“VoNR”), four-carrier and higher order aggregation, dynamic network slicing and the U.S.’s first broad deployment of 5G Advanced, are 7 Table of Contents enabled by our scaled nationwide 5G standalone network.
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Currently, we have over 40 DE&I chapters across the nation that help spearhead volunteer opportunities, events and meaningful conversation with employees at a local level.
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We are also part of an alliance working to bring Radio Access Network (“RAN”) and AI innovation closer together to deliver transformational network experiences in the future.
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As part of T-Mobile’s Equity In Action Plan and Promises, we have established two External Diversity and Inclusion Councils in connection with our civil rights memorandum of understanding. The councils include civil rights leaders representing a wide range of underrepresented communities.
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In addition to our wireless communications services, our High Speed Internet service competes against other broadband providers, including traditional wireline solutions, such as Cable, DSL and Fiber broadband providers, and fixed wireless solutions, including AT&T and Verizon’s fixed wireless products, and Satellite Internet providers.
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Together with T-Mobile, the councils are helping us identify ways to improve our efforts in focus areas such as corporate governance, workforce recruitment and retention, procurement, entrepreneurship, philanthropy and community investment. Since April 2020, we have achieved a significant portion of the Equity In Action Promises, currently at 80% completed.
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Belonging and Inclusion Our diversity, equity and inclusion efforts are focused on fostering a workplace that helps us better serve our customers and communities across the nation. We aim to create an environment where employees feel included, valued and empowered, contributing to a stronger, more connected business.
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As DE&I are instrumental to our culture and values, we are also on a mission to create fair and equitable opportunities for all suppliers, including veteran-owned, disability-owned, woman-owned, minority-owned, LGBT-owned and small and disadvantaged businesses.
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T-Mobile has an inclusive hiring process that seeks diverse talent to be candidates for employment, but all of our hiring decisions continue to be based solely on merit. Employee Resource Groups (ERGs) Many of our employees participate in one of six Employee Resource Groups (ERGs) and their sub-groups, which are instrumental in promoting connection.
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We have implemented a Supplier Diversity Category Management Strategy for our network technology procurement organization to help identify opportunities and develop actionable targets for progress on this topic.
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These groups offer immersive experiences, mentorship programs, networking opportunities, and community service projects. They are designed to help participants grow as professionals and community leaders . External Diversity Councils In partnership with civil rights organizations, we had previously established two External Diversity and Inclusion Councils.
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This year, we updated our Supplier Diversity Policy that provides the primary guidance designed to ensure that DE&I are integrated into the purchasing process of goods and services for and on behalf of T-Mobile.
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These councils offered guidance for our efforts in areas like workforce recruitment, procurement, community investment, and corporate governance. The work with these external councils concluded as planned after a successful 5-year collaboration and the councils have been dissolved.
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In addition, we published T-Mobile’s CEO Supplier Diversity Policy Statement, reenforcing our Equity In Action diversity plan that aims to increase the amount of business we do with diverse suppliers.
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Suppliers T-Mobile considers a broad range of suppliers, including those that are veteran-owned, disability-owned, woman-owned, minority-owned, and LGBT-owned, and we include small and large businesses of all kinds in our procurement processes. Purchases and contracts are awarded based on the best qualified and most competitive suppliers to enable T-Mobile’s success.
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Environmental Sustainability Reducing Our Carbon Footprint We are working to reduce the impact of our operations on the climate by setting carbon reduction goals that are aligned with science and investing in renewable energy.
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A number of states also subject wireless service providers to registration requirements. State authority over wireless broadband services will likely remain unsettled unless resolved by the courts, the FCC or Congress.
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We first met this goal in 2021 and have achieved it in each subsequent year so far by matching our electricity usage with renewable energy credits acquired through a variety of sources, including through our engagement in Virtual Power Purchasing Agreements and a Green Direct tariff agreement with nine clean energy providers for expected annual provision of approximately 3.5 million megawatt hours of renewable electricity; • Continuously testing and evaluating more efficient equipment for our facilities, including switch stations, cell sites, retail stores and customer experience centers to reduce energy consumption; and • Promoting a circular economy through our device reuse and recycle program, which collects millions of devices for reuse, resale, and recycling annually.
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Further, the FCC and the Federal Aviation Administration regulate the siting, lighting and construction of transmitter towers and antennae. Tower siting and construction are also subject to state and local zoning, as well as federal statutes regarding environmental and historic preservation.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn connection with the regulatory proceedings and approvals required to close the Transactions, we agreed to fulfill various Government Commitments. These Government Commitments include, among other things, extensive 5G network build-out commitments, obligations to deliver high-speed wireless services to the vast majority of Americans and marketing our in-home fixed wireless product to households where spectrum capacity is sufficient.
Biggest changeAdditionally, in connection with our merger (the “Merger”) with Sprint Corporation (“Sprint”) and related transactions, including the acquisition by DISH of certain prepaid wireless business (the “Prepaid Transaction” and, collectively, the “Transactions”), we agreed to fulfill various government commitments (the “Government Commitments”), including, among others, extensive 5G network build-out, delivering high-speed wireless services to the vast majority of Americans and marketing our in-home fixed wireless product to households where spectrum capacity is sufficient, as well as commitments related to national security, pricing and availability of rate plans.
Item 1A. Risk Factors In addition to the other information contained in this Form 10-K, the following risk factors should be considered carefully in evaluating T-Mobile. Our business, financial condition, liquidity, or operating results, as well as the price of our common stock and other securities, could be materially adversely affected by any of these risks.
Item 1A. Risk Factors In addition to the other information contained in this Form 10-K, the following risk factors should be considered carefully in evaluating T-Mobile. Our business, financial condition, liquidity, or operating results, as well as the price of our common stock and other securities, could be materially and adversely affected by any of these risks.
If key employees depart or we are unable to recruit and integrate new employees successfully, our business could be negatively impacted. System failures and business disruptions may prevent us from providing reliable service, which could materially adversely affect our reputation and financial condition.
If key employees depart or we are unable to recruit and integrate new employees successfully, our business could be negatively impacted. System failures and business disruptions may prevent us from providing reliable service, which could materially and adversely affect our reputation and financial condition.
If we cannot acquire needed spectrum from the government or otherwise, if competitors acquire spectrum that will allow them to provide services competitive with our services, or if we cannot deploy services over acquired spectrum on a timely basis without burdensome conditions, at reasonable cost, and while maintaining network quality levels, our ability to attract and retain customers and our business, financial condition and operating results could be materially adversely affected.
If we cannot acquire needed spectrum from the government or otherwise, if competitors acquire spectrum that will allow them to provide services competitive with our services, or if we cannot deploy services over acquired spectrum on a timely basis without burdensome conditions, at reasonable cost, and while maintaining network quality levels, our ability to attract and retain customers and our business, financial condition and operating results could be materially and adversely affected.
We cannot assure that the FCC or any other federal, state, or local agencies will not adopt regulations, change or discontinue existing programs, implement new programs, or take enforcement or other actions that would adversely affect our business, impose new costs, or require changes in current or planned operations, including timing of the shutdown of legacy technologies.
We cannot assure that the FCC or any other federal, state, or local agencies will not adopt or change regulations, change or discontinue existing programs, implement new programs, or take enforcement or other actions that would adversely affect our business, impose new costs, or require changes in current or planned operations, including timing of the shutdown of legacy technologies.
Examples of these risks include: • physical damage, power surges or outages, equipment failure, or other service disruptions with respect to both our wireless and wireline networks, including those resulting from severe weather, storms, earthquakes, floods, hurricanes, wildfires and natural disasters, which may occur more frequently or with greater intensity as a result of global climate change, public health crises, terrorist attacks, political instability and volatility and acts of war; • human error due to factors such as poor change management or policy compliance; • risks to our access to and use of reliable energy and water; • hardware or software failures or outages of our business systems or communications network; • supplier failures or delays; and • potential shifts in physical conditions due to climate change, such as sea-level rise or changes in temperature or precipitation patterns, may impact the operating conditions of our infrastructure or other infrastructure we rely on.
Examples of these risks include: • physical damage, power surges or outages, equipment failure, or other service disruptions with respect to both our wireless and wireline networks, including those resulting from severe weather, storms, earthquakes, floods, hurricanes, wildfires and other natural disasters, which may occur more frequently or with greater intensity as a result of global climate change, public health crises, terrorist attacks, political instability and volatility and acts of war; • human error due to factors such as poor change management or policy compliance; • risks to our access to and use of reliable energy and water; • hardware or software failures or outages of our business systems or communications network; • supplier failures or delays; and • shifts in physical conditions due to climate change, such as sea-level rise or changes in temperature or precipitation patterns, which may impact the operating conditions of our infrastructure or other infrastructure we rely on.
Any actual or perceived failure to comply with the CCPA, CPRA, other data privacy laws or regulations, or related contractual or other obligations, or any perceived privacy rights violation, could lead to investigations, claims, and proceedings by governmental entities and private parties, damages for contract breaches, and other significant costs, penalties, and other liabilities, as well as harm to our reputation and market position.
Any actual or perceived failure to comply with the CCPA, other data privacy laws or regulations, or related contractual or other obligations, or any perceived privacy rights violation, could lead to investigations, claims, and proceedings by governmental entities and private parties, damages for contract breaches, and other significant costs, penalties, and other liabilities, as well as harm to our reputation and market position.
Further, we may need to incur substantial additional indebtedness in the future, subject to the restrictions contained in our debt instruments, if any, which could increase the risks associated with our capital structure. Our ability to service our substantial debt obligations will depend on future performance, which will be affected by business, economic, market and industry conditions and other factors.
Further, we may incur substantial additional indebtedness in the future, subject to the restrictions contained in our debt instruments, if any, which could increase the risks associated with our capital structure. Our ability to service our substantial debt obligations will depend on future performance, which will be affected by business, economic, market and industry conditions and other factors.
Our wireless licenses are subject to renewal and may be revoked in the event that we violate applicable laws. Our existing wireless licenses are subject to renewal upon the expiration of the period for which they are granted. Our licenses have been granted with an expectation of renewal and the FCC has approved our license renewal applications.
Our wireless licenses are subject to renewal and may be revoked in the event that we violate applicable laws. Our existing wireless licenses are subject to renewal upon the expiration of the period for which they are granted. Our licenses have been granted with an expectation of renewal, and the FCC generally has approved our license renewal applications.
Numerous other smaller and regional MNOs and MVNOs offering wireless services may also compete with us in some markets, including cable providers, such as Comcast, Charter, Cox, and Altice, as they continue to diversify their offerings to include wireless services offered under MVNO agreements.
Numerous other regional MNOs and MVNOs offering wireless services may also compete with us in some markets, including cable providers, such as Comcast, Charter, Cox, and Altice, as they continue to diversify their offerings to include wireless services offered under MVNO agreements.
Our suppliers are also subject to their own risks, including, but not limited to, economic, financial and credit conditions, labor force disruptions, geopolitical tensions, disruptions in global supply chain and the risks of natural catastrophic events (such as earthquakes, floods, hurricanes, storms, heatwaves and fires), energy shortages, power outages, equipment failures, terrorist attacks or other hostile acts, and public health crises, such as the COVID-19 pandemic (the “Pandemic”), which may result in performance below the levels required by their contracts.
Our suppliers are also subject to their own risks, including, but not limited to, cybersecurity, economic, financial and credit conditions, labor force disruptions, geopolitical tensions, disruptions in global supply chain and the risks of natural catastrophic events (such as earthquakes, floods, hurricanes, storms, heatwaves and fires), energy shortages, power outages, equipment failures, terrorist attacks or other hostile acts, and public health crises, such as the COVID-19 pandemic, which may result in performance below the levels required by their contracts.
As a company that sells products and services across the nation to millions of customers, these dynamics increase the risk of potential reputational damage, boycotts, and shifts in consumer behavior that could adversely affect our sales and profitability.
As a company that sells products and services across the nation to millions of customers, these dynamics increase the risk of potential reputational damage, boycotts, and shifts in consumer behavior that could adversely affect our brand, sales and profitability.
Our business involves the receipt, storage, and transmission of confidential information about our customers, such as sensitive personal, account and payment card information, confidential information about our employees and suppliers, and other sensitive information about our Company, such as our business plans, transactions, financial information, and intellectual property (collectively, “Confidential Information”).
Our business involves the receipt, storage, and transmission of confidential information about our customers, such as sensitive personal, account and payment information, confidential information about our employees and suppliers, and other sensitive information about our Company, such as our business plans, transactions, financial information, and intellectual property (collectively, “Confidential Information”).
The specific timing and amount of any share repurchases, and the specific timing and amount of any dividend payments, under the 2023-2024 Stockholder Return Program will depend on prevailing share prices, general economic and market conditions, Company performance and other considerations, such as whether the Company determines that there are other uses for the funds currently authorized for the program that would be more advantageous for our business.
The specific timing and amount of any share repurchases and any dividend payments under any stockholder return program will depend on prevailing share prices, general economic and market conditions, Company performance and other considerations, such as whether the Company determines that there are other uses for the funds currently authorized for the program that would be more advantageous for our business.
We also expect that threat actors will continue to gain sophistication including in the use of tools and techniques (such as artificial intelligence) that are specifically designed to circumvent security controls, evade detection, and obfuscate forensic evidence, making it more challenging for us to identify, investigate and recover from future cyberattacks in a timely and effective manner.
We also expect that threat actors will continue to gain sophistication including in the use of tools and techniques (such as AI) that are specifically designed to circumvent security controls, evade detection, and obfuscate forensic evidence, making it more challenging for us to identify, investigate and recover from future cyberattacks in a timely and effective manner.
We, along with equipment manufacturers and other carriers, are subject to current and potential future lawsuits alleging adverse health effects arising from the use of wireless handsets or from wireless transmission equipment such as cell towers.
In addition, we, along with equipment manufacturers and other carriers, are subject to current and potential future lawsuits alleging adverse health effects arising from the use of wireless handsets or from wireless transmission equipment such as cell towers.
As described in more detail in our Proxy Statement on Schedule 14A filed with the SEC on April 27, 2022 under the heading “Transactions with Related Persons and Approval,” we are obligated to pay DT a royalty in an amount equal to 0.25% (the “royalty rate”) of the net revenue (as defined in the trademark license) generated by products and services sold by the Company under the licensed trademarks subject to a cap of $80 million per calendar year through December 31, 2028.
As described in more detail in our Proxy Statement on Schedule 14A filed with the SEC on April 24, 2024 under the heading “Transactions with Related Persons and Approval,” we are obligated to pay DT a royalty in an amount equal to 0.25% (the “royalty rate”) of the net revenue (as defined in the trademark license) generated by products and services sold by the Company under the licensed trademarks subject to a cap of $80 million per calendar year through December 31, 2028.
Risks Related to Our Business We operate in a highly competitive industry. If we are unable to attract and retain customers, our business, financial conditions, and operating results would be negatively affected. The wireless communications services industry is highly competitive.
Risks Related to Our Business We operate in a highly competitive industry. If we are unable to attract and retain customers, our business, financial condition, and operating results would be negatively affected. The wireless communications services industry is highly competitive.
Failure to comply with applicable regulations and the realization of any of these risks could have a material adverse effect on our business, financial condition, and operating results. Our business may be impacted by new or amended tax laws or regulations or administrative interpretations and judicial decisions affecting the scope or application of tax laws or regulations.
Failure to comply with applicable regulations and the realization of any of these risks could have a material adverse effect on our business, financial condition, and operating results. 21 Table of Contents Our business may be impacted by new or amended tax laws or regulations or administrative interpretations and judicial decisions affecting the scope or application of tax laws or regulations.
In addition, the specific timing 23 Table of Contents and amount of any dividend payments are subject to declaration on future dates by the Board in its sole discretion. The 2023-2024 Stockholder Return Program could impact our cash flows and affect the trading price of our common stock and increase volatility.
In addition, the specific timing and amount of any dividend payments are subject to declaration on future dates by the Board of Directors in its sole discretion. 23 Table of Contents Any stockholder return program could impact our cash flows and affect the trading price of our common stock and increase volatility.
Both external factors, such as fluctuations in economic and industry conditions, changes in U.S. immigration policies, and the competitive landscape, and internal factors, such as employee tolerance for changes in our corporate culture, organizational changes, limited remote working opportunities, and our compensation programs, may impact our ability to effectively manage our workforce.
Both external factors, such as fluctuations in economic and industry conditions, changes in U.S. immigration policies, regulatory changes, political forces and the competitive landscape, and internal factors, such as employee tolerance for changes in our corporate culture, organizational changes, limited remote working opportunities, and our compensation programs, may impact our ability to effectively manage our workforce.
Weak economic and credit conditions may also adversely impact our suppliers, dealers, and wholesale partners or MVNOs, some of which may file for bankruptcy, or may experience cash flow or liquidity problems, or may be unable to obtain or refinance credit such that they may no longer be able to operate.
Weak economic and credit conditions may also adversely impact our suppliers, dealers, wholesale partners or MVNOs, and enterprise and government customers, some of which may file for bankruptcy, or may experience cash flow or liquidity problems, or may be unable to obtain or refinance credit such that they may no longer be able to operate.
In addition, this level of indebtedness may also reduce funds available for capital expenditures, any Board-approved share repurchases, dividends or other activities. Those impacts may put us at a competitive disadvantage relative to other companies with lower debt levels.
In addition, this level of indebtedness may 18 Table of Contents also reduce funds available for capital expenditures, any Board-approved share repurchases, dividends or other activities. Those impacts may put us at a competitive disadvantage relative to other companies with lower debt levels.
As many of our service plans offer taxes 21 Table of Contents and fees inclusive, our business results could be adversely impacted by increases in taxes and fees. In addition, we incur and pay state and local transaction taxes and fees on purchases of goods and services used in our business.
As many of our service plans offer taxes and fees inclusive, our business results could be adversely impacted by increases in taxes and fees. In addition, we incur and pay state and local transaction taxes and fees on purchases of goods and services used in our business.
For more information, see “– Contingencies and Litigation – Litigation and Regulatory Matters” in Note 17 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements.
For more information, see “– Contingencies and Litigation – Litigation and Regulatory Matters” in Note 18 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements.
In particular, the FCC imposes significant regulation on licensees of wireless spectrum with respect to how radio spectrum is used by licensees, the nature of the services that licensees may offer and how the services may be offered, and the resolution of issues of interference between operators in the same or adjacent spectrum bands.
In particular, the FCC imposes significant regulation on licensees of wireless spectrum with respect to how radio spectrum is used by licensees or at what power levels, the nature of the services that licensees may offer and how the services may be offered, and the resolution of issues of interference between operators in the same or adjacent spectrum bands.
While T-Mobile may have contractual rights to assess the effectiveness of many of our providers’ systems and protocols, we do not have the means to know or assess the effectiveness of all of our providers’ systems and controls at all times.
While T-Mobile may have contractual rights to assess the effectiveness of many of our providers’ systems and protocols, we do not have the means to always know or assess the effectiveness of all of our providers’ systems and controls.
Since 2020, a number of states have enacted new, comprehensive privacy laws that create new data privacy rights for residents of those states and new compliance obligations for us and the industry in general, in addition to private rights of action for certain types of data breaches.
Since 2020, more than a dozen states have enacted new, comprehensive privacy laws that create new data privacy rights for residents of those states and new compliance obligations for us and the industry in general, in addition to private rights of action for certain types of data breaches.
Any announcement of termination of the 2023-2024 Stockholder Return Program may result in a decrease in the price of our common stock. Future sales of our common stock by DT and SoftBank and foreign ownership limitations by the FCC could have a negative impact on our stock price and decrease the value of our stock.
Any announcement of termination of any program may result in a decrease in the price of our common stock. Future sales of our common stock by DT and SoftBank and foreign ownership limitations by the FCC could have a negative impact on our stock price and decrease the value of our stock.
In many cases, the application of existing, newly enacted or amended tax laws may be uncertain and subject to different interpretations, especially when evaluated against new technologies and telecommunications services, such as broadband internet access and cloud-related services and in the context of our merger with Sprint.
In many cases, the application of existing, newly enacted or amended tax laws may be uncertain and subject to different interpretations, especially when evaluated against new technologies and telecommunications services, such as broadband internet access and cloud-related services.
In this fluid and volatile sociopolitical environment, our ability to respond effectively, sensitively, and authentically to the expectations and concerns of our customers, employees, and other stakeholders is key to mitigating these risks. If we are unable to manage these challenges effectively, there may be adverse impacts to our business, reputation, financial condition, and operating results.
Our ability to respond effectively, sensitively, and authentically to the expectations and concerns of our customers, employees, and other stakeholders is key to mitigating these risks. If we are unable to manage these challenges effectively, there may be adverse impacts to our business, reputation, financial condition, and operating results.
We have experienced criminal cyberattacks and are vulnerable to disruption, data loss and other security breaches, whether directly or indirectly through third parties whose products and services we rely on in operating our business.
We have experienced criminal cyberattacks and may experience disruption, data loss and other security breaches, whether directly or indirectly through third parties whose products and services we rely on in operating our business.
Any such transaction would involve a number of risks and could present financial, managerial and operational challenges, including: • diversion of management attention from running our existing business; • increased costs to integrate the networks, spectrum, technology, personnel, customer base and business practices of the company involved in any such transaction with our business; • potential loss of talent during integration due to differences in culture, locations, or other factors; • difficulties in effectively integrating the financial, operational and sustainability systems of the business involved in any such transaction into (or supplanting such systems with) our financial, operational and sustainability reporting infrastructure and internal control framework in an effective and timely manner; • potential exposure to material liabilities not discovered in the due diligence process or as a result of any litigation arising in connection with any such transaction; • significant transaction-related expenses in connection with any such transaction, whether consummated or not; • risks related to our ability to obtain any required regulatory approvals necessary to consummate any such transaction; and • any business, technology, service, or product involved in any such transaction may significantly under-perform relative to our expectations, and we may not achieve the benefits we expect from the transaction, which could, among other things, also result in a write-down of goodwill and other intangible assets associated with such transaction.
Any such transaction would involve a number of risks and could present financial, managerial and operational challenges, including: • diversion of management attention from running our existing business; • increased costs to integrate the networks, spectrum, technology, personnel, customer base, distributors and business partners and business practices of the company involved in any such transaction with our business; • increased interest expense and leverage or limits on other uses of cash; • potential loss of talent during integration due to differences in culture, locations, or other factors; • difficulties in effectively integrating the financial, operational and sustainability systems of the business involved in any such transaction into (or supplanting such systems with) our financial, operational and sustainability reporting infrastructure and internal control framework in an effective and timely manner; • risks of entering markets in which the Company has no or limited experience and where competitors have stronger market positions; • potential exposure to material liabilities not discovered in the due diligence process or as a result of any litigation arising in connection with any such transaction; • significant transaction-related expenses in connection with any such transaction, whether consummated or not; • risks related to our ability to obtain any required regulatory approvals necessary to consummate any such transaction; and • any business, technology, service, or product involved in any such transaction may significantly under-perform relative to our expectations, and we may not achieve the benefits we expect from the transaction, which could, among other things, also result in a write-down of goodwill and other intangible assets associated with such transaction.
Our procedures and safeguards to prevent unauthorized access to Confidential Information and to defend against cyberattacks seeking to disrupt our operations must be continually evaluated and enhanced to address the ever-evolving threat landscape and changing cybersecurity regulations. These preventative actions require the investment of significant resources and management time and attention.
Our procedures and safeguards to prevent unauthorized access to Confidential Information and to defend against cyberattacks seeking to disrupt our operations must be continually evaluated and enhanced to address the ever-evolving threat landscape and changing cybersecurity regulations, including while we adapt complex digital transformation efforts. These preventative actions require the investment of significant resources and management time and attention.
We have, and we expect that we will continue to have, a substantial amount of debt. Our substantial level of indebtedness could have the effect of, among other things, reducing our flexibility in responding to changing business, economic, market and industry conditions and increasing the amount of cash required to service our debt.
Our substantial level of indebtedness could have the effect of, among other things, reducing our flexibility in responding to changing business, economic, market and industry conditions and increasing the amount of cash required to service our debt.
A further increase in the royalty rate or termination of the trademark license could have a material adverse effect on our business, financial condition, and operating results. We cannot guarantee that our 2023-2024 Stockholder Return Program will be fully utilized or that it will enhance long-term stockholder value.
A further increase in the royalty rate or termination of the trademark license could have a material adverse effect on our business, financial condition, and operating results. We cannot guarantee that our current and future stockholder return programs will be fully utilized or that they will enhance long-term stockholder value.
Additionally, targeted marketing approaches for diverse customer segments, including Prepaid, Postpaid, Business and Government customers, coupled with continuous innovation in products and services, are essential for retaining and expanding our customer base. If we are unable to successfully differentiate our services from our competitors, it would adversely affect our competitive position and ability to grow our business.
Additionally, targeted marketing approaches for diverse customer segments, coupled with continuous innovation in products and services, are essential for retaining and 12 Table of Contents expanding our customer base. If we are unable to successfully differentiate our services from our competitors, it would adversely affect our competitive position and ability to grow our business.
We cannot guarantee that the 2023-2024 Stockholder Return Program will be fully consummated or that it will enhance long-term stockholder value.
We cannot guarantee that any stockholder return program will be fully consummated or that it will enhance long-term stockholder value.
We also cannot assure that Congress will not amend the Communications Act, from which the FCC obtains its authority, and which serves to limit state authority, or enact other legislation in a manner that could be adverse to our business.
We also face potential investigations by, and inquiries from or actions by state public utility commissions. We also cannot assure that Congress will not amend the Communications Act, from which the FCC obtains its authority, and which serves to limit state authority, or enact other legislation in a manner that could be adverse to our business.
We have seen and expect to continue to see intense competition in all market segments from traditional Mobile Network Operators (MNOs), such as AT&T and Verizon, particularly as they invest in spectrum, their wireless network and services, and device promotions, and DISH as it continues to build out its wireless network and roll out services.
We have seen and expect to continue to see intense competition in all market segments from traditional Mobile Network Operators (“MNOs”), such as AT&T and Verizon, who have each invested heavily in spectrum, their wireless networks, and services and device promotions, and DISH, as it continues to build out its wireless network and roll out services.
Failure to comply with applicable regulations could have a material adverse effect on our business, financial condition, and operating results. We could be subject to fines, forfeitures, and other penalties (including, in extreme cases, revocation of our spectrum licenses) for failure to comply with the FCC or other governmental regulations, even if any such noncompliance was unintentional.
We could be subject to fines, forfeitures, and other penalties (including, in extreme cases, revocation of our spectrum licenses) for failure to comply with the FCC or other governmental regulations, even if any such noncompliance was unintentional. The loss of any licenses, or any related fines or forfeitures, could adversely affect our business, financial condition, and operating results.
Additionally, we have faced and will continue to face various litigations alleging that our products or services infringe patents or other intellectual property of third parties.
Additionally, we have faced and will continue to face various litigations alleging that our products or services infringe patents or other intellectual property of third parties, including potential litigation arising from our use of AI.
Further, privacy laws also limit our ability to collect and use personal information. We have incurred and will continue to incur significant implementation costs to ensure compliance with the CCPA, the CPRA, new privacy laws in other states, and their related regulations, including managing the complexity of laws that vary from state to state.
We have incurred and will continue to incur significant implementation costs to ensure compliance with the CCPA, new privacy laws in other states, and their related regulations, including managing the complexity of laws that vary from state to state.
These third-party providers have experienced in the past, and will continue to experience in the future, cyberattacks that involve attempts to obtain unauthorized access to our Confidential Information and/or to create operational disruptions that could adversely affect our business, and these providers also face other security challenges common to all parties that collect and process information.
These third-party providers have experienced, and will continue to experience cyberattacks that involve attempts to expose our Confidential Information and/or to create operational risk that could materially and adversely affect our business, and these providers also face other security challenges common to all parties that collect and process information.
The 2023-2024 Stockholder Return Program does not obligate the Company to acquire any particular amount of common stock or to declare and pay any particular amount of dividends, and the 2023-2024 Stockholder Return Program may be suspended or discontinued at any time at the Company’s discretion.
Our current and future stockholder return programs do not, and will not, obligate the Company to acquire any particular amount of common stock or to declare and pay any particular amount of dividends, and any program may be suspended or discontinued at any time at the Company’s discretion.
We rely upon systems and networks – those of third-party suppliers and other providers, in addition to our own – to provide and support our service offerings. System, network, or infrastructure failures resulting from a number of causes may prevent us from providing reliable service.
We rely upon systems and networks – those of third-party suppliers and other providers, in addition to our own – to provide services to our customers. System, network, or infrastructure failures resulting from one of several potential causes may prevent us from providing reliable service or otherwise operate our business.
As new products and services emerge, we may also be forced to compete against non-traditional competitors from outside of the wireless communications services industry, such as satellite providers, offering similar connectivity services using alternative technologies.
As new products and services emerge, we may also be forced to compete against non-traditional competitors from outside of the wireless communications services industry, such as satellite providers, offering similar connectivity services using alternative technologies. In the market for broadband services, traditional cable providers, AT&T, Verizon, and other players such as satellite and fiber providers, all compete for customers.
The increasing intersection of technology and politics has led to rapid and unpredictable shifts in public sentiment. Social media and digital platforms have amplified the voices of various stakeholders, creating the potential for swift change in public opinion and stronger reactions to corporate actions.
Social media and digital platforms have amplified the voices of various stakeholders, creating the potential for swift change in public opinion and stronger reactions to corporate actions.
If we are unable to protect our intellectual property due to factors such as changes in US intellectual property laws, the value of our intellectual property may become impaired, which may adversely impact our business and financial results.
We rely on a variety of intellectual property assets, including patents, copyrights, trademarks, and domains, to maintain our competitiveness. If we are unable to protect our intellectual property due to factors such as changes in US intellectual property laws, the value of our intellectual property may become impaired, which may adversely impact our business and financial results.
Additionally, to offer services to our customers and operate our business, we utilize a number of applications and systems, including those we own and operate as well as others provided by third-party providers, such as cloud services (collectively, “Systems”).
Additionally, to offer services to our customers and operate our business, we utilize several applications and systems, including those we own and operate, such as our wireless network, as well as others provided to us by third parties, such as cloud service providers and SaaS companies (collectively, “Systems”).
In addition, DT holds direct and indirect call options that give DT the right to acquire up to approximately 35 million shares of our common stock held by SoftBank. 22 Table of Contents Accordingly, DT controls a majority of the voting power of our common stock and therefore we are a “controlled company,” as defined in the NASDAQ Stock Market LLC (“NASDAQ”) listing rules, and we are not subject to NASDAQ requirements that would otherwise require us to have a majority of independent directors, a nominating committee composed solely of independent directors or a compensation committee composed solely of independent directors.
DT controls a majority of the voting power of our common stock and therefore we are a “controlled company,” as defined in the NASDAQ Stock Market LLC (“NASDAQ”) listing rules, and we are not subject to NASDAQ requirements that would otherwise require us to have a majority of independent directors, a nominating committee composed solely of independent directors or a compensation committee composed solely of independent directors.
Alternatively, if a court were to find the choice of forum provision to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such matters in other jurisdictions, which could increase our costs of litigation and adversely affect our business and financial condition.
Alternatively, if a court were to find the choice of forum provision to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such matters in other jurisdictions, which could increase our costs of litigation and adversely affect our business and financial condition. 22 Table of Contents DT controls a majority of the voting power of our common stock and the T-Mobile trademarks we utilize in our business and may have interests that differ from the interests of our other stockholders.
Our business, financial condition, and operating results are sensitive to changes in general economic conditions, including interest rates, consumer credit conditions, consumer debt levels, consumer confidence, unemployment rates, economic growth, energy costs, rates of inflation (or concerns about deflation), supply chain disruptions, impacts of current geopolitical conflict or instability, such as the Ukraine-Russia and Israel-Hamas wars and further escalations thereof, and other macroeconomic factors. 15 Table of Contents The wireless industry, broadly, is dependent on population growth, as a result, we expect the wireless industry’s customer growth rate to be moderate in comparison with historical growth rates, leading to ongoing competition for customers.
Our business, financial condition, and operating results are sensitive to changes in general economic conditions, including interest rates, consumer credit conditions, consumer debt levels, consumer confidence, unemployment rates, economic growth, energy costs, rates of inflation (or concerns about deflation), supply chain disruptions, impacts of current geopolitical conflict or instability, such as the Ukraine-Russia and Israel-Hamas wars and further escalations thereof, and other macroeconomic factors.
In addition, we may be unable to secure the spectrum necessary to maintain or enhance our competitive position in any auction we may elect to participate in or in the secondary market, on favorable terms or at all.
However, we may be unable to secure the additional spectrum necessary to maintain or enhance our competitive position on favorable terms or at all.
Our services and device financing plans are available to a broad customer base, a significant segment of which may be vulnerable to weak economic conditions, particularly our subprime customers.
Rising prices for goods, services, and labor due to inflation could adversely impact our margins and/or growth. Our services and device financing plans are available to a broad customer base, a significant segment of which may be vulnerable to weak economic conditions, particularly our subprime customers.
Some of these potential transactions could be significant relative to the size of our business and operations.
We may also elect to divest some of our assets to third parties. Some of these potential transactions could be significant relative to the size of our business and operations.
Cyberattacks against companies like ours have increased in frequency and scope of potential harm over time, and the methods used to gain unauthorized access constantly evolve, making it increasingly difficult to anticipate, prevent, and detect incidents successfully in every instance.
Some actors reside in jurisdictions where law enforcement measures to address such attacks are ineffective or unavailable. Cyberattacks against companies like ours are increasing in frequency and scope of potential harm over time, and the methods used to gain unauthorized access constantly evolve, making it increasingly difficult to anticipate, prevent, and detect incidents successfully in every instance.
Our insurance may not cover or may not be adequate to fully reimburse us for costs and losses associated with such events, and such events may also impact the availability of insurance at costs and other terms we find acceptable for future events.
Our insurance may not cover or may not be adequate to fully reimburse us for costs and losses associated with such events, and such events may also impact the availability of insurance at costs and other terms we find acceptable for future events. 15 Table of Contents The scarcity and cost of additional wireless spectrum, and regulations relating to spectrum use, may adversely affect our business, financial condition, and operating results.
Pending legislation in several other states would create similar laws elsewhere. All of these new privacy laws and others that we expect to be developed and enacted going forward will impose additional data protection obligations and 19 Table of Contents potential liability on companies such as ours doing business in those states.
All of these new privacy laws and others that we expect to be developed and enacted going forward will impose additional data protection obligations and potential liability on companies such as ours doing business in those states. Further, privacy laws also limit our ability to collect and use personal information.
These products expose us to a wide variety of state and federal regulations. The financing of devices, such as through our EIP, JUMP! On Demand or other leasing programs, such as those acquired in the Merger, has expanded our regulatory compliance obligations.
These products expose us to a wide variety of state and federal regulations. The financing of devices, such as through our EIP, impact our regulatory compliance obligations.
In other cases, these bad actors may obtain unauthorized access to Confidential Information by exploiting insider access or utilizing log in credentials taken from our customers, employees, or third-party providers through credential harvesting, social engineering or other means. Other bad actors aim to cause serious operational disruptions to our business and Systems through ransomware or distributed denial of services attacks.
In some cases, these bad actors exploit bugs, errors, misconfigurations or other vulnerabilities in our Systems to obtain Confidential Information. In other cases, these bad actors obtain unauthorized access to Confidential Information by exploiting insider access or utilizing log in credentials taken from our customers, employees, or third-party providers through credential harvesting, social engineering or other means.
The loss of any licenses, or any related fines or forfeitures, could adversely affect our business, financial condition, and operating results. Laws and regulations relating to the handling of privacy and data protection may result in increased costs, legal claims, fines against us, or reputational damage.
Laws and regulations relating to the handling of privacy, data protection and AI may result in increased costs, legal claims, fines against us, or reputational damage.
Our business could be harmed if we are unable to retain or motivate key personnel, hire qualified personnel, or maintain our corporate culture. Our future success depends in substantial part on our ability to recruit, hire, motivate, develop, and retain talented personnel for all areas of our organization, including our CEO and members of our senior leadership team.
Our future success depends in substantial part on our ability to attract, recruit, hire, motivate, develop, and retain talented personnel possessing the qualifications, experiences, capabilities and skills we need for all areas of our organization, including our CEO and members of our senior leadership team.
As a result, we may experience negative impacts to our business financial condition or operating results, which would restrict our ability to access the capital markets, require the expenditure of significant resources to correct the weaknesses or deficiencies, subject us to fines, penalties, investigations, or judgments, harm our reputation, or otherwise cause a decline in trading price of our stock and investor confidence. 18 Table of Contents Changes in regulations or in the regulatory framework under which we operate could adversely affect our business, financial condition, and operating results.
As a result, we could face legal fines and penalties, diminished investor confidence, and adverse impacts on our access to the capital markets, potentially resulting in a decline in our stock price and harm to our reputation. 19 Table of Contents Changes in regulations or in the regulatory framework under which we operate could adversely affect our business, financial condition, and operating results.
We may pursue acquisitions of, investments in or mergers with other companies, or the acquisition of technologies, services, products or other assets, that we believe would complement or expand our business. We may also elect to divest some of our assets to third parties.
Any acquisition, divestiture, investment, joint venture or merger may subject us to significant risks, any of which may harm our business. We may pursue acquisitions of, investments in, or joint ventures or mergers with, other companies, or the acquisition of technologies, services, products or other assets that we believe would complement or expand our business.
In other cases, the incidents have involved unauthorized access to certain of our customers’ private information, including credit card information, financial data, social security numbers or passwords, and to certain of our intellectual property.
Typically, these incidents have involved attempts to commit fraud by taking control of a customer’s phone line, often by exploiting insider access or using compromised credentials. In other cases, the incidents have involved unauthorized access to certain of our customers’ private information, including payment information, financial data, social security numbers or passwords, and our intellectual property.
We rely on third parties to provide products and services for the operation of our business, and the failure or inability of such parties to provide these products or services could adversely affect our business, financial condition, and operating results.
Should these new products and services fail to gain traction, generate expected returns, or deliver value to customers, we could incur substantial expenses without offsetting revenue gains, adversely affecting our business, financial condition, and operating results. 17 Table of Contents We rely on third parties to provide products and services for the operation of our business, and the failure or inability of such parties to provide these products or services could adversely affect our business, financial condition, and operating results.
In connection with the closing of the Prepaid Transaction, we and DISH entered into certain arrangements, including a Master Network Services Agreement (the “MNSA”) and a License Purchase Agreement (as amended, the “DISH License Purchase Agreement”). Pursuant to the MNSA, DISH will receive network services from the Company for a period of seven years.
In connection with the Prepaid Transaction, we and DISH entered into certain arrangements, including a Master Network Services Agreement (the “MNSA”), pursuant to which we provide DISH, for a period of seven years, network services for certain end users and infrastructure mobile network operator services to assist in the access and integration of the DISH network.
Any of these could adversely impact our ability to distribute, market, or sell our products and services. Sociopolitical volatility and polarization may adversely affect our business operations and reputation. The current sociopolitical environment is characterized by deep complexity, volatility, and polarization on various social and political issues.
Sociopolitical volatility and polarization may adversely affect our business operations and reputation. The current sociopolitical environment is characterized by deep complexity, volatility, and polarization on various social and political issues. The increasing intersection of technology and politics has led to rapid and unpredictable shifts in public sentiment.
The continued interest in, and acquisition of, spectrum by existing carriers and others, including speculators, may reduce our ability to acquire and/or increase the cost of acquiring spectrum in the secondary market, including leasing, or purchasing additional spectrum in the 2.5 GHz band, or negatively impact our ability to gain access to spectrum through other means, including government auctions.
The continued interest in acquiring spectrum by existing carriers and others, including speculators, may reduce our ability to acquire or renew spectrum holdings (such as 2.5Ghz), and/or increase the cost of spectrum that is made available in the secondary markets and government auctions.
In order to expand and differentiate from our competitors, we will continue to actively seek to make additional investment in spectrum, which could be significant.
We continue to acquire and deploy new spectrum to expand and deepen our 5G coverage, maintain our quality of service, meet increasing or changing customer demands, and deploy new technologies. In order to expand and differentiate our services from our competitors, we will continue to actively seek to make additional investments in new spectrum, which could be significant.
Risks Related to Legal and Regulatory Matters Failure to maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could result in a loss of investor confidence regarding our financial statements and reputational damage.
Risks Related to Legal and Regulatory Matters Failure to maintain effective internal control over financial reporting could impair our compliance with Section 404 of the Sarbanes-Oxley Act, which could lead to material misstatements in our financial statements and adversely affect our operations and reputation.
As the industry reaches saturation with a relatively fixed pool of customers, competition will likely further intensify, putting pressure on pricing and margins for us and all our competitors. Our ability to attract and retain customers will depend on key factors such as network quality and capacity, customer service excellence, effective marketing strategies, competitive pricing, and compelling value propositions.
Our ability to attract and retain customers will depend on multiple factors, such as network quality and capacity, customer service excellence, effective marketing strategies, competitive pricing, compelling value propositions, and distribution and logistics capabilities.
They are perpetrated by a variety of groups and persons, including state-sponsored parties, malicious actors, employees, contractors, or other unrelated third parties.
We are subject to persistent cyberattacks and threats to our business from bad actors seeking to gain unauthorized access to Confidential Information and compromise Systems to undermine availability or integrity. They are perpetrated by a variety of groups and persons, including nation state-sponsored parties, malicious actors, employees, contractors, or other unrelated third parties.
In addition, litigation or similar proceedings could impose restraints on our current or future manner of doing business. Such potential outcomes including judgments, awards, settlements or orders could have a material adverse effect on our business, reputation, financial condition, cash flows and operating results.
Such potential outcomes including judgments, awards, settlements or orders could have a material adverse effect on our business, reputation, financial condition, cash flows and operating results. Our business may be adversely impacted if we are not able to protect our intellectual property rights or if we infringe on the intellectual property rights of others.
For any or all of these reasons, as well as unknown risks, acquisitions, divestitures, investments, or mergers may have a material adverse effect on our business, financial condition, and operating results.
Any of these risks could have a material adverse effect on our business, financial condition and results of operations and could also affect our reputation.
For more information, see “– Contingencies and Litigation – Litigation and Regulatory Matters” in Note 17 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements.
For more information on the foregoing, see “– Contingencies and Litigation – Litigation and Regulatory Matters” in Note 1 8 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements. In addition to the August 2021 cyberattack and the January 2023 cyberattack, we have experienced unrelated non-material incidents involving unauthorized access to certain Confidential Information and Systems.
Any failure to fulfill our obligations under these Government Commitments in a timely manner could result in substantial fines, penalties, or other legal and administrative actions and/or reputational harm. We expect to continue incurring significant costs, expenses, and fees to track, monitor, comply with and fulfill our obligations under these Government Commitments over a number of years.
Any failure to fulfill our obligations under the Government Commitments and the MNSA in a timely manner could result in substantial fines, penalties, or other legal and administrative actions, liabilities, and reputational harm. Economic, political and market conditions may adversely affect our business, financial condition, and operating results.
The assessment of the outcome of legal proceedings, including our potential liability, if any, is a highly subjective process that requires judgments about future events that are not within our control. The amounts ultimately received or paid upon settlement or pursuant to final judgment, order or decree may differ materially from amounts accrued in our financial statements.
The amounts ultimately received or paid upon settlement or pursuant to final judgment, order or decree may differ materially from amounts accrued in our financial statements. In addition, litigation or similar proceedings could impose restraints on our current or future manner of doing business.
The failure of our suppliers to comply with our expectations and policies could expose us to additional legal and litigation risks and lead to unexpected contract terminations. 17 Table of Contents Risks Related to Our Indebtedness Our substantial level of indebtedness could adversely affect our business flexibility and ability to service our debt, and increase our borrowing costs.
The failure of our suppliers to comply with our expectations and policies could expose us to additional legal and litigation risks and lead to unexpected contract terminations. Additionally, we rely on third-party technology partners on various projects and developments.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Senior Vice President, Internal Audit & Risk Management (the “Chief Audit Executive”), periodically presents 24 Table of Contents enterprise risks, including cybersecurity risks, to the Audit Committee of our Board of Directors (the “Audit Committee”). Our Chief Compliance Officer regularly attends meetings at the NCG Committee providing insights from the compliance perspective relating to cybersecurity.
Biggest changeOur Senior Vice President, Internal Audit & Risk Management (the “Chief Audit Executive”), periodically presents enterprise risks, including cybersecurity risks, to the Audit Committee of our Board of Directors (the “Audit Committee”). Our 24 Table of Contents Chief Compliance Officer regularly attends meetings of the NCG Committee to provide insights from the compliance perspective relating to cybersecurity.
The 25 Table of Contents CSO, under the direction of the Transformation and Chief Information & Digital Officer, is responsible for overseeing the cybersecurity organization and promoting a security-centric culture throughout our business and operational functions. The CSO is at the forefront of enhancing our cybersecurity framework and strengthening the overall cybersecurity program.
The CSO, under the direction of the Transformation and Chief Information & Digital Officer, is responsible for overseeing the 25 Table of Contents cybersecurity organization and promoting a security-centric culture throughout our business and operational functions. The CSO is at the forefront of enhancing our cybersecurity framework and strengthening the overall cybersecurity program.
Additionally, the Audit Committee receives updates on significant incidents and cybersecurity risks that have been presented to or discussed with the Enterprise Risk and Compliance Committee. 26 Table of Contents
Additionally, the Audit Committee receives updates on significant incidents and cybersecurity risks that have been presented to or discussed with the Enterprise Risk & Compliance Committee. 26 Table of Contents
The Enterprise Risk & Compliance Committee is chaired by the Chief Financial Officer (“CFO”) of the Company, with the Executive Vice President & General Counsel as the co-chair and comprises core members including the Transformation and Chief Information & Digital Officer, while the CSO serves in an advisory capacity.
The Enterprise Risk & Compliance Committee is chaired by the Chief Financial Officer of the Company, with the Executive Vice President & General Counsel as the co-chair and comprises core members including the Transformation and Chief Information & Digital Officer, while the CSO serves in an advisory capacity.
Disclosure of the Board’s Roles and Responsibilities Our Board of Directors oversees risks from cybersecurity threats using a multi-faceted approach that involves the NGC Committee and Audit Committee and various executive roles. Additionally, our Transformation and Chief Information & Digital Officer and CSO report on cybersecurity to the full Board.
Disclosure of the Board’s Roles and Responsibilities Our Board of Directors oversees risks from cybersecurity threats using a multi-faceted approach that involves the NCG Committee and Audit Committee and various executive roles. Additionally, our Transformation and Chief Information & Digital Officer and CSO report on cybersecurity to the full Board.
Cyber risk management is a core component of the Company's governance structure. We utilize the National Institute of Standards and Technology’s Cybersecurity Framework (“NIST CSF”) as a guide in cyber risk management to identify, assess, and assist the CSO in managing cybersecurity risks.
Cyber risk management is a core component of the Company's governance structure. We utilize the National Institute of Standards and Technology’s Cybersecurity Framework as a guide in cyber risk management to identify, assess, and assist the CSO in managing cybersecurity risks.
Cybersecurity Incident Impact As previously disclosed, in August 2021, we experienced a cybersecurity incident that resulted in numerous lawsuits, including mass arbitration claims and multiple class action lawsuits. In January 2023, we experienced another cybersecurity incident that also resulted in consumer class actions and regulatory inquires.
Cybersecurity Incident Impact As previously disclosed, in August 2021, we experienced a cybersecurity incident that resulted in numerous lawsuits, including mass arbitration claims and multiple class action lawsuits. In January 2023, we experienced another cybersecurity incident that also resulted in consumer class actions and regulatory inquiries.
For additional details regarding the impact of both cybersecurity incidents, see Note 17 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements. We have not identified other known risks from previous cybersecurity threats that have materially affected or are reasonably likely to materially affect us.
For additional details regarding the impact of both cybersecurity incidents, see Note 1 8 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements. We have not identified other known risks from previous cybersecurity threats that have materially affected or are reasonably likely to materially affect us.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur property and equipment consists of the following: (percent of gross property and equipment) December 31, 2023 December 31, 2022 Wireless communications systems 68 % 68 % Land, buildings and building equipment 5 % 5 % Data processing equipment and other 27 % 27 % Total 100 % 100 % Wireless communications systems primarily consist of assets used to operate our wireless network and information technology data centers, including switching equipment, radio frequency equipment, tower assets, High Speed Internet routers, construction in progress and leasehold improvements related to the wireless network and asset retirement costs.
Biggest changeOur property and equipment consists of the following: (percent of gross property and equipment) December 31, 2024 December 31, 2023 Wireless communications systems 71 % 68 % Land, buildings and building equipment 5 % 5 % Data processing equipment and other 24 % 27 % Total 100 % 100 % Wireless communications systems primarily consist of assets used to operate our wireless network and information technology data centers, including switching equipment, radio frequency equipment, tower assets, High Speed Internet routers, construction in progress and leasehold improvements related to the wireless network and asset retirement costs.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings For more information regarding the legal proceedings in which we are involved, see Note 17 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements. Item 4. Mine Safety Disclosures Not applicable. 27 Table of Contents PART II.
Biggest changeItem 3. Legal Proceedings For more information regarding the legal proceedings in which we are involved, see Note 1 8 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements. Item 4. Mine Safety Disclosures Not applicable. 27 Table of Contents PART II.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The table below provides information regarding our share repurchases during the three months ended December 31, 2023: (in millions, except share and per share amounts) Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that may yet be Purchased Under the Plans or Programs (1) October 1, 2023 - October 31, 2023 7,980,509 $ 140.09 7,980,509 $ 17,135 November 1, 2023 - November 30, 2023 5,675,804 147.45 5,675,804 16,298 December 1, 2023 - December 31, 2023 1,807,794 158.53 1,807,794 16,012 Total 15,464,107 15,464,107 (1) On September 6, 2023, our Board of Directors authorized our 2023-2024 Stockholder Return Program for up to $19.0 billion of repurchases of our common stock and payment of dividends through December 31, 2024.
Biggest changeIssuer Purchases of Equity Securities The table below provides information regarding our share repurchases during the three months ended December 31, 2024: (in millions, except share and per share amounts) Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that may yet be Purchased Under the Plans or Programs (1) October 1, 2024 - October 31, 2024 7,070,211 $ 217.82 7,070,211 $ 5,731 November 1, 2024 - November 30, 2024 6,527,845 235.76 6,527,845 4,192 December 1, 2024 - December 31, 2024 6,685,526 230.35 6,685,526 14,004 Total 20,283,582 20,283,582 (1) On September 6, 2023, our Board of Directors authorized a stockholder return program for up to $19.0 billion of repurchases of our common stock and payment of dividends through December 31, 2024 (the “2023-2024 Stockholder Return Program”).
See Note 13 - Stockholder Return Programs of the Notes to the Consolidated Financial Statements for more information about our 2023-2024 Stockholder Return Program. 28 Table of Contents Performance Graph The graph below compares the five-year cumulative total returns of T-Mobile, the S&P 500 index, the NASDAQ Composite index and the Dow Jones US Mobile Telecommunications TSM index.
See Note 1 5 - Stockholder Return Programs of the Notes to the Consolidated Financial Statements for more information about our 2023-2024 Stockholder Return Program and 2025 Stockholder Return Program. 28 Table of Contents Performance Graph The graph below compares the five-year cumulative total returns of T-Mobile, the S&P 500 index, the NASDAQ Composite index and the Dow Jones US Mobile Telecommunications TSM index.
The amounts presented represent the remaining dollar amount authorized for purchase under the 2023-2024 Stockholder Return Program as of the end of the period, which has been reduced by the amount of any cash dividends declared and paid by the Company. On December 19, 2023, the U.S.
The amounts presented represent the remaining dollar amount authorized for purchase under the 2023-2024 Stockholder Return Program and 2025 Stockholder Return Program, as applicable, as of the end of the period, which has been reduced by the amount of any cash dividends declared and paid by the Company.
As of January 31, 2024, there were 15,240 registered stockholders of record of our common stock, but we estimate the total number of stockholders to be much higher as a number of our shares are held by brokers or dealers for their customers in street name.
As of January 24, 2025, there were 14,513 registered stockholders of record of our common stock, but we estimate the total number of stockholders to be much higher as a number of our shares are held by brokers or dealers for their customers in street name.
The graph tracks the performance of a $100 investment, with the reinvestment of all dividends, from December 31, 2018 to December 31, 2023.
The graph tracks the performance of a $100 investment, with the reinvestment of all dividends, from December 31, 2019 to December 31, 2024.
Subsequent to December 31, 2023, 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 is payable on March 14, 2024, to stockholders of record as of the close of business on March 1, 2024.
Additionally, on November 21, 2024, our Board of Directors declared a quarterly cash dividend of $0.88 per share on our issued and outstanding common stock, which will be paid on March 13, 2025, to stockholders of record as of the close of business on February 28, 2025, as part of our 2025 Stockholder Return Program (as defined below).
The five-year cumulative total returns of T-Mobile, the S&P 500 index, the NASDAQ Composite index and the Dow Jones US Mobile Telecommunications TSM index, as illustrated in the graph above, are as follows: At December 31, (in dollars) 2018 2019 2020 2021 2022 2023 T-Mobile US, Inc. $ 100.00 $ 123.28 $ 211.99 $ 182.33 $ 220.09 $ 253.14 S&P 500 100.00 131.49 155.68 200.37 164.08 207.21 NASDAQ Composite 100.00 136.69 198.10 242.03 163.28 236.17 Dow Jones US Mobile Telecommunications TSM 100.00 113.40 123.64 112.98 101.97 109.60 The stock price performance included in this graph is not necessarily indicative of future stock price performance.
The five-year cumulative total returns of T-Mobile, the S&P 500 index, the NASDAQ Composite index and the Dow Jones US Mobile Telecommunications TSM index, as illustrated in the graph above, are as follows: At December 31, (in dollars) 2019 2020 2021 2022 2023 2024 T-Mobile US, Inc. $ 100.00 $ 171.96 $ 147.90 $ 178.53 $ 205.33 $ 286.82 S&P 500 100.00 118.40 152.39 124.79 157.59 197.02 NASDAQ Composite 100.00 144.92 177.06 119.45 172.77 223.87 Dow Jones US Mobile Telecommunications TSM 100.00 109.03 99.62 89.92 96.64 118.64 The stock price performance included in this graph is not necessarily indicative of future stock price performance.
Removed
On September 25, 2023, our Board of Directors declared a cash dividend of $0.65 per share on our issued and outstanding shares of common stock, which was paid on December 15, 2023. We intend to declare and pay approximately $3.0 billion in total additional dividends in 2024, with payments occurring each quarter during the year.
Added
During the year ended December 31, 2024, we declared and paid cash dividends totaling $2.83 per share, as part of our 2023-2024 Stockholder Return Program (as defined below).
Removed
The dividend amount paid per share is expected to grow by around 10% annually with the first increase expected in the fourth quarter of 2024; however, the declaration and payment of all dividends is subject to the discretion of our Board of Directors and will depend on financial and legal requirements and other considerations.
Added
On December 13, 2024, we announced that our Board of Directors authorized a stockholder return program for up to an additional $14.0 billion that will run through December 31, 2025 (the “2025 Stockholder Return Program”).
Removed
Court of Appeals for the Fifth Circuit vacated the SEC amendments to share repurchase disclosure requirements. Accordingly, we will continue to present monthly share repurchase activity in this Item.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe summarized balance sheet information for the consolidated obligor group of debt issued by T-Mobile USA, Inc. is presented in the table below: (in millions) December 31, 2023 December 31, 2022 Current assets $ 17,601 $ 17,661 Noncurrent assets 178,252 181,673 Current liabilities 19,040 23,146 Noncurrent liabilities 128,197 120,385 Due to non-guarantors 10,916 9,325 Due to related parties 1,576 1,571 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) Year Ended December 31, 2023 Year Ended December 31, 2022 Total revenues $ 75,934 $ 77,054 Operating income 10,707 2,985 Net income (loss) 4,766 (572) Revenue from non-guarantors 2,393 2,427 Operating expenses to non-guarantors 2,569 2,659 Other expense to non-guarantors (699) (327) The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint is presented in the table below: (in millions) December 31, 2023 December 31, 2022 Current assets $ 11,193 $ 9,319 Noncurrent assets 11,324 11,271 Current liabilities 12,751 15,854 Noncurrent liabilities 110,688 65,118 Due to non-guarantors 41,805 3,930 Due to related parties 1,576 1,571 The summarized results of operations information for the consolidated obligor group of debt issued by Sprint is presented in the table below: (in millions) Year Ended December 31, 2023 Year Ended December 31, 2022 Total revenues $ 19 $ 7 Operating loss (3,197) (3,479) Net (loss) income (1) (7,629) 2,471 Other (expense) income, net, (to) from non-guarantors (2,005) 525 (1) Net income for the year ended December 31, 2022, includes tax benefits recognized associated with certain entity restructuring. 38 Table of Contents 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) December 31, 2023 December 31, 2022 Current assets $ 11,193 $ 9,320 Noncurrent assets 11,324 16,337 Current liabilities 12,823 15,926 Noncurrent liabilities 106,881 66,516 Due to non-guarantors 32,706 — Due from non-guarantors — 5,066 Due to related parties 1,576 1,571 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) Year Ended December 31, 2023 Year Ended December 31, 2022 Total revenues $ 19 $ 7 Operating loss (3,197) (3,479) Net (loss) income (1) (7,491) 2,604 Other (expense) income, net, (to) from non-guarantors (1,489) 941 (1) Net income for the year ended December 31, 2022, includes tax benefits recognized associated with certain entity restructuring.
Biggest changeThe 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) Year Ended December 31, 2024 Year Ended December 31, 2023 Total revenues $ 78,996 $ 75,934 Operating income 14,463 10,707 Net income 8,360 4,766 Revenue from non-guarantors 2,619 2,393 Operating expenses to non-guarantors 2,481 2,569 Other expense to non-guarantors (116) (699) 36 Table of Contents The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint is presented in the table below: (in millions) December 31, 2024 December 31, 2023 Current assets $ 10,970 $ 11,193 Noncurrent assets 14,734 11,324 Current liabilities 12,683 12,751 Noncurrent liabilities (1) 96,145 110,688 Due to non-guarantors (1) 21,371 41,805 Due to related parties 2,098 1,576 (1) The decrease in Noncurrent liabilities and Due to non-guarantors was primarily driven by the impact of certain intercompany settlements during the year ended December 31, 2024.
Such scenarios and uncertainties may affect, among others, expected credit loss activity as well as certain fair value estimates. To date, price inflation has not had a significant impact on our operations as we have fixed rates established through long-term contracts for many of our most significant costs, including tower agreements and backhaul contracts.
Such scenarios and uncertainties may affect, among others, expected credit loss activity as well as certain fair value estimates. To date, price inflation has not had a significant impact on our operations as we have fixed rates established through long-term contracts for many of our most significant costs, including for many of our tower agreements and backhaul contracts.
We account for uncertainty in income taxes recognized in the financial statements in accordance with the accounting guidance for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
Income Taxes We account for uncertainty in income taxes recognized in the financial statements in accordance with the accounting guidance for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
In September 2022, the FCC announced that we were the winning bidder of 7,156 licenses in Auction 108 (2.5 GHz spectrum) for an aggregate price of $304 million. At inception of Auction 108 in June 2022, we deposited $65 million. We paid the FCC the remaining $239 million for the licenses won in the auction in September 2022.
Spectrum Auctions In September 2022, the FCC announced that we were the winning bidder of 7,156 licenses in Auction 108 (2.5 GHz spectrum) for an aggregate price of $304 million. At inception of Auction 108 in June 2022, we deposited $65 million. We paid the FCC the remaining $239 million for the licenses won in the auction in September 2022.
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 year ended December 31, 2023, 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 year ended December 31, 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.
Gross revenues and net profits recorded from these activities for the year ended December 31, 2023, were less than $0.1 million. We understand that DT intends to continue these activities. Separately, SoftBank, through one of its non-U.S. subsidiaries, provides roaming services in Iran through Irancell Telecommunications Services Company.
Gross revenues and net profits recorded from these activities for the year ended December 31, 2024, were less than $0.1 million. We understand that DT intends to continue these activities. Separately, SoftBank, through one of its non-U.S. subsidiaries, provides roaming services in Iran through Irancell Telecommunications Services Company.
See Note 17 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements for further information. (4) On August 8, 2022, we entered into License Purchase Agreements to acquire spectrum in the 600 MHz band from Channel 51 License Co LLC and LB License Co, LLC in exchange for total cash consideration of $3.5 billion.
See Note 1 8 – Commitments and Contingencies of the Notes to the Consolidated Financial Statements for further information. (4) On August 8, 2022, we entered into License Purchase Agreements to acquire spectrum in the 600 MHz band from Channel 51 License Co LLC and LB License Co, LLC in exchange for total cash consideration of $3.5 billion.
During the year ended December 31, 2023, 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 year ended December 31, 2024, 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.
Our MD&A is provided as a supplement to, and should be read together with, our audited consolidated financial statements as of December 31, 2023 and 2022, and for each of the three years in the period ended December 31, 2023, included in Part II, Item 8 of this Form 10-K.
Our MD&A is provided as a supplement to, and should be read together with, our audited consolidated financial statements as of December 31, 2024 and 2023, and for each of the three years in the period ended December 31, 2024, included in Part II, Item 8 of this Form 10-K.
For certain contracts that include fixed volume purchase commitments and fixed prices for various products, the purchase obligations are calculated using fixed volumes and contractually fixed prices for the products that are expected to be purchased. This table does not include open purchase orders as of December 31, 2023 under normal business purposes.
For certain contracts that include fixed volume purchase commitments and fixed prices for various products, the purchase obligations are calculated using fixed volumes and contractually fixed prices for the products that are expected to be purchased. This table does not include open purchase orders as of December 31, 2024 under normal business purposes.
In addition, during the year ended December 31, 2023, 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 year ended December 31, 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.
We were in compliance with all restrictive debt covenants as of December 31, 2023. 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.
We were in compliance with all restrictive debt covenants as of December 31, 2024. 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.
For the year ended December 31, 2023, 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.
For the year ended December 31, 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.
Similarly, our exposure to the impact of rising interest rates is limited, primarily to any new debt issuances or draws on our revolving credit facility, as interest is paid on our Senior Notes at a fixed rate.
Similarly, our exposure to the impact of rising interest rates is limited, primarily to any new debt issuances or draws on our Revolving Credit Facility (as defined below), as interest is paid on our Senior Notes at a fixed rate.
Our intended use of any such funds is for general corporate purposes, including for capital expenditures, spectrum purchases, opportunistic investments and acquisitions, redemption of debt, tower obligations, workforce restructuring, share repurchases, and dividend payments.
Our intended use of any such funds is for general corporate purposes, including for capital expenditures, spectrum purchases, opportunistic investments and acquisitions, redemption of debt, tower obligations, share repurchases, and dividend payments.
See Note 1 – Summary of Significant Accounting Policies and Note 5 – Property and Equipment of the Notes to the Consolidated Financial Statements for information regarding depreciation of assets, including management’s underlying estimates of useful lives.
See Note 1 – Summary of Significant Accounting Policies and Note 6 – Property and Equipment of the Notes to the Consolidated Financial Statements for information regarding depreciation of assets, including management’s underlying estimates of useful lives.
Other, net, for the year ended December 31, 2023, includes $462 million of severance and related costs associated with the August 2023 workforce reduction. NM - Not meaningful Core Adjusted EBITDA increased $2.7 billion, or 10%, for the year ended December 31, 2023. The components comprising Core Adjusted EBITDA are discussed further above.
Other, net, for the year ended December 31, 2023, includes $462 million of severance and related costs associated with the August 2023 workforce reduction. NM - Not meaningful Core Adjusted EBITDA increased $2.7 billion, or 9%, for the year ended December 31, 2024. The components comprising Core Adjusted EBITDA are discussed further above.
See Note 8 – Debt of the Notes to the Consolidated Financial Statements for further information. (2) Future minimum payments, including principal and interest payments, related to the tower obligations. See Note 9 – Tower Obligations of the Notes to the Consolidated Financial Statements for further information.
See Note 9 – Debt of the Notes to the Consolidated Financial Statements for further information. (2) Future minimum payments, including principal and interest payments, related to the tower obligations. See Note 10 – Tower Obligations of the Notes to the Consolidated Financial Statements for further information.
License Purchase Agreements On August 8, 2022, we entered into License Purchase Agreements to acquire spectrum in the 600 MHz band from Channel 51 License Co LLC and LB License Co, LLC in exchange for total cash consideration of $3.5 billion.
License Purchase Agreements On August 8, 2022, we entered into License Purchase Agreements to acquire spectrum in the 600 MHz band from Channel 51 License Co LLC and LB License Co, LLC (together with Channel 51 License Co LLC, the “Sellers”) in exchange for total cash consideration of $3.5 billion.
Merger-Related Costs Merger-related costs associated with the Merger and acquisitions of affiliates 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; and • Transaction costs, including legal and professional services related to the completion of the transactions.
Merger-Related Costs Merger-related costs associated with our Merger with Sprint 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; and • Transaction costs, including legal and professional services related to the completion of the transactions.
For more information regarding these off-balance sheet arrangements, see Note 4 – Sales of Certain Receivables of the Notes to the Consolidated Financial Statements.
For more information regarding these off-balance sheet arrangements, see Note 5 – Sales of Certain Receivables of the Notes to the Consolidated Financial Statements.
For a discussion and analysis of the year ended December 31, 2022, compared to the same period in 2021, please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 14, 2023.
For a discussion and analysis of the year ended December 31, 2023, compared to the same period in 2022, please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 2, 2024.
High Speed Internet net customer additions included in prepaid net customer additions were 252,000 and 236,000 for the years ended December 31, 2023 and 2022, respectively. Churn 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.
High Speed Internet net customer additions included in prepaid net customer additions were 200,000 and 252,000 for the years ended December 31, 2024 and 2023, respectively. Churn 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.
Management and the Audit Committee of the Board of Directors have reviewed and approved the accounting policies associated with these critical estimates. 50 Table of Contents Depreciation Our property and equipment balance represents a significant component of our consolidated assets.
Management and the Audit Committee of the Board of Directors have reviewed and approved the accounting policies associated with these critical estimates. Depreciation Our property and equipment balance represents a significant component of our consolidated assets.
Further, the incurrence of additional indebtedness may inhibit our 43 Table of Contents ability to incur new debt in the future to finance our business strategy under the terms governing our existing and future indebtedness.
Further, the incurrence of additional indebtedness may inhibit our ability to incur new debt in the future to finance our business strategy under the terms governing our existing and future indebtedness.
Accounting Pronouncements Not Yet Adopted For information regarding recently issued accounting standards, see Note 1 – Summary of Significant Accounting Policies of the Notes to the Consolidated Financial Statements.
Accounting Pronouncements Not Yet Adopted For information regarding recently issued accounting standards, see Note 1 – Summary of Significant Accounting Policies of the Notes to the Consolidated Financial Statements. 51 Table of Contents
During the year ended December 31, 2023, 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. In addition, SoftBank, through one of its non-U.S. indirect subsidiaries, provides office supplies to the Embassy of Iran in Japan.
In addition, SoftBank, through one of its non-U.S. 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 year ended December 31, 2024, were both under $0.1 million. We understand that the SoftBank subsidiary intends to continue such activities.
Revenue Trends In 2024, we expect Postpaid service revenues to continue to grow, primarily due to continued postpaid account and customer growth as well as Postpaid Average Revenue per Account (“postpaid ARPA”) growth driven by the execution of our strategy to continuously deepen our account relationships, including growth in High Speed Internet.
Revenue Trends In 2025, we expect Postpaid service revenues to continue to grow, primarily due to continued postpaid account and customer growth as well as postpaid Average Revenue per Account (“ARPA”) growth driven by the execution of our strategy to continuously deepen our account relationships, including growth in High Speed Internet.
As of December 31, 2023, we have entered into $8.7 billion of financing leases under these financing lease facilities, of which $1.2 billion was executed during the year ended December 31, 2023. We expect to enter into up to a total of $1.2 billion in financing lease commitments during the year ending December 31, 2024.
As of December 31, 2024, we have entered into $9.9 billion of financing leases under these financing lease facilities, of which $1.2 billion was executed during the year ended December 31, 2024. We expect to enter into up to a total of $1.2 billion in financing lease commitments during the year ending December 31, 2025.
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 December 31, 2023, we derecognized net receivables of $2.4 billion upon sale through these arrangements.
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 December 31, 2024, we derecognized net receivables of $1.6 billion upon sale through these arrangements.
We have incurred, and will incur, substantial expenses to comply with the Government Commitments, and we also expect to incur all of the remaining restructuring and integration costs associated with the Merger by the first half of 2024, 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, 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.
The use of cash was primarily from: • $13.1 billion in Repurchases of common stock; • $5.1 billion in Repayments of long-term debt; • $1.2 billion in Repayments of financing lease obligations; • $747 million in Dividends on common stock ; and • $297 million in Tax withholdings on share-based awards; partially offset by • $8.4 billion in Proceeds from issuance of long-term debt.
The use of cash was primarily from: • $11.2 billion in Repurchases of common stock; • $5.1 billion in Repayments of long-term debt; • $3.3 billion in Dividends on common stock; • $1.4 billion in Repayments of financing lease obligations; and • $269 million in Tax withholdings on share-based awards; partially offset by • $8.6 billion in Proceeds from issuance of long-term debt.
Cash and Cash Equivalents As of December 31, 2023, our Cash and cash equivalents were $5.1 billion compared to $4.5 billion at December 31, 2022. 44 Table of Contents 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 and less Cash payments for debt prepayment or debt extinguishment costs.
Cash and Cash Equivalents As of December 31, 2024, our Cash and cash equivalents were $5.4 billion compared to $5.1 billion at December 31, 2023. 43 Table of Contents 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.
(3) Other, net, primarily consists of certain severance, restructuring and other expenses and income not directly attributable to the Merger which are not reflective of T-Mobile’s core business activities (“special items”) and are, therefore, excluded from Adjusted EBITDA and Core Adjusted EBITDA.
(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.
If all other factors were to remain unchanged, we expect that a one-year increase in the useful lives of our in-service property and equipment, exclusive of leased devices, would have resulted in a decrease of approximately $3.0 billion in our 2023 depreciation expense and that a one-year decrease in the useful life would have resulted in an increase of approximately $4.5 billion in our 2023 depreciation expense.
If all other factors were to remain unchanged, we expect that a one-year increase in the useful lives of our in-service property and equipment would have resulted in a decrease of approximately $3.2 billion in our 2024 depreciation expense and that a one-year decrease in the useful life would have resulted in an increase of approximately $4.6 billion in our 2024 depreciation expense.
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.
Capital Expenditures 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.
Income before income taxes , the components of which are discussed above, was $11.0 billion and $3.1 billion for the years ended December 31, 2023 and 2022, respectively.
Income before income taxes , the components of which are discussed above, was $14.7 billion and $11.0 billion for the years ended December 31, 2024 and 2023, respectively.
Total revenues decreased $1.0 billion, or 1%. The components of these changes are discussed below. Postpaid revenues increased $2.8 billion, or 6%, primarily from: • Higher average postpaid accounts; and • Higher postpaid ARPA. See “Postpaid ARPA” in the “ Performance Measures ” section of this MD&A. Prepaid revenues decreased slightly, primarily from: • Lower prepaid ARPU.
Total revenues increased $2.8 billion, or 4%. The components of these changes are discussed below. Postpaid revenues increased $3.6 billion, or 7%, primarily from: • Higher average postpaid accounts; and • Higher postpaid ARPA. See “Postpaid ARPA” in the “ Performance Measures ” section of this MD&A.
As of January 31, 2024, DT and SoftBank held, directly or indirectly, approximately 50.7% and 7.8%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 41.5% of the outstanding T-Mobile common stock held by other stockholders.
As of January 24, 2025, DT and SoftBank held, directly or indirectly, approximately 51.5% and 7.5%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 41.0% of the outstanding T-Mobile common stock held by other stockholders.
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: Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 (in millions, except percentages) 2023 2022 2021 $ Change % Change $ Change % Change Net cash provided by operating activities $ 18,559 $ 16,781 $ 13,917 $ 1,778 11 % $ 2,864 21 % Cash purchases of property and equipment, including capitalized interest (9,801) (13,970) (12,326) 4,169 (30) % (1,644) 13 % Proceeds from sales of tower sites 12 9 40 3 33 % (31) (78) % Proceeds related to beneficial interests in securitization transactions 4,816 4,836 4,131 (20) — % 705 17 % Cash payments for debt prepayment or debt extinguishment costs — — (116) — — % 116 (100) % Adjusted Free Cash Flow $ 13,586 $ 7,656 $ 5,646 $ 5,930 77 % $ 2,010 36 % Net cash provided by operating activities margin (Net cash provided by operating activities divided by Service revenues) 29 % 27 % 24 % 200 bps 300 bps Adjusted Free Cash Flow margin (Adjusted Free Cash Flow divided by Service revenues) 21 % 12 % 10 % 900 bps 200 bps Adjusted Free Cash Flow increased $5.9 billion, or 77%, primarily impacted by the following: • Higher Net cash provided by operating activities, as described above; and • Lower Cash purchases of property and equipment, including capitalized interest, driven by increased capital efficiencies from accelerated investments in our nationwide 5G network in 2022. • Adjusted Free Cash Flow includes the impact of $2.0 billion and $3.4 billion in net payments for Merger-related costs for the years ended December 31, 2023 and 2022, respectively.
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: Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 (in millions, except percentages) 2024 2023 2022 $ Change % Change $ Change % Change Net cash provided by operating activities $ 22,293 $ 18,559 $ 16,781 $ 3,734 20 % $ 1,778 11 % Cash purchases of property and equipment, including capitalized interest (8,840) (9,801) (13,970) 961 (10) % 4,169 (30) % Proceeds from sales of tower sites — 12 9 (12) (100) % 3 33 % Proceeds related to beneficial interests in securitization transactions 3,579 4,816 4,836 (1,237) (26) % (20) — % Adjusted Free Cash Flow $ 17,032 $ 13,586 $ 7,656 $ 3,446 25 % $ 5,930 77 % Net cash provided by operating activities margin (Net cash provided by operating activities divided by Service revenues) 34 % 29 % 27 % 500 bps 200 bps Adjusted Free Cash Flow margin (Adjusted Free Cash Flow divided by Service revenues) 26 % 21 % 12 % 500 bps 900 bps Adjusted Free Cash Flow increased $3.4 billion, or 25%, for the year ended December 31, 2024, primarily from: • Higher Net cash provided by operating activities, as described above; and • 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; 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 $767 million and $2.0 billion for the years ended December 31, 2024 and 2023, respectively, in net payments for Merger-related costs.
SoftBank estimates that gross revenues and net profit generated by such services during the year ended December 31, 2023, were both under $0.1 million. We understand that the SoftBank subsidiary intends to continue such activities.
During the year ended December 31, 2024, SoftBank estimates that gross revenues and net profit 50 Table of Contents 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.
Certain customers now serviced through reseller contracts were removed from our reported postpaid customer base resulting in the removal of 42,000 postpaid phone customers and 20,000 postpaid other customers in the second quarter of 2022. (2) In the first quarter of 2021, we acquired 11,000 postpaid phone customers and 1,000 postpaid other customers through our acquisition of an affiliate.
Certain customers now serviced through reseller contracts were removed from our reported postpaid customer base resulting in the removal of 42,000 postpaid phone customers and 20,000 postpaid other customers in the second quarter of 2022.
Cash Flows The following is a condensed schedule of our cash flows: Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 (in millions) 2023 2022 2021 $ Change % Change $ Change % Change Net cash provided by operating activities $ 18,559 $ 16,781 $ 13,917 $ 1,778 11 % $ 2,864 21 % Net cash used in investing activities (5,829) (12,359) (19,386) 6,530 (53) % 7,027 (36) % Net cash (used in) provided by financing activities (12,097) (6,451) 1,709 (5,646) 88 % (8,160) (477) % Operating Activities Net cash provided by operating activities increased $1.8 billion, or 11%, primarily from: • A $5.8 billion increase in Net income, adjusted for non-cash income and expense; partially offset by • A $4.0 billion increase in net cash outflows from changes in working capital, primarily due to higher use of cash from Accounts payable and accrued liabilities, Operating lease right-of-use assets, Other current and long-term liabilities, Short- and long-term operating lease liabilities and Inventory, partially offset by lower use of cash from Equipment installment plan receivables and Other current and long-term assets. • Net cash provided by operating activities includes the impact of $2.0 billion and $3.4 billion in net payments for Merger-related costs for the years ended December 31, 2023 and 2022, respectively.
Cash Flows The following is a condensed schedule of our cash flows: Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 (in millions) 2024 2023 2022 $ Change % Change $ Change % Change Net cash provided by operating activities $ 22,293 $ 18,559 $ 16,781 $ 3,734 20 % $ 1,778 11 % Net cash used in investing activities (9,072) (5,829) (12,359) (3,243) 56 % 6,530 (53) % Net cash used in financing activities (12,815) (12,097) (6,451) (718) 6 % (5,646) 88 % Operating Activities Net cash provided by operating activities increased $3.7 billion, or 20%, primarily from: • A $3.7 billion increase in Net income, adjusted for non-cash income and expenses; and • A $49 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 Accounts payable and accrued liabilities, Equipment installment plan receivables and Operating lease right-of-use assets. • Net cash provided by operating activities includes the impact of $767 million and $2.0 billion in net payments for Merger-related costs for the years ended December 31, 2024 and 2023, respectively.
Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin have limitations as analytical tools and should not be considered in isolation or as substitutes for income from operations, net income or any other measure of financial performance reported in accordance with GAAP. 42 Table of Contents 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: Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 (in millions, except percentages) 2023 2022 2021 $ Change % Change $ Change % Change Net income $ 8,317 $ 2,590 $ 3,024 $ 5,727 221 % $ (434) (14) % Adjustments: Interest expense, net 3,335 3,364 3,342 (29) (1) % 22 1 % Other (income) expense, net (68) 33 199 (101) (306) % (166) (83) % Income tax expense 2,682 556 327 2,126 382 % 229 70 % Operating income 14,266 6,543 6,892 7,723 118 % (349) (5) % Depreciation and amortization 12,818 13,651 16,383 (833) (6) % (2,732) (17) % Stock-based compensation (1) 644 576 521 68 12 % 55 11 % Merger-related costs 1,034 4,969 3,107 (3,935) (79) % 1,862 60 % Impairment expense — 477 — (477) (100) % 477 NM Legal-related (recoveries) expenses, net (2) (42) 391 — (433) (111) % 391 NM (Gain) loss on disposal group held for sale (25) 1,087 — (1,112) (102) % 1,087 NM Other, net (3) 733 127 21 606 477 % 106 505 % Adjusted EBITDA 29,428 27,821 26,924 1,607 6 % 897 3 % Lease revenues (312) (1,430) (3,348) 1,118 (78) % 1,918 (57) % Core Adjusted EBITDA $ 29,116 $ 26,391 $ 23,576 $ 2,725 10 % $ 2,815 12 % Net income margin (Net income divided by Service revenues) 13 % 4 % 5 % 900 bps -100 bps Adjusted EBITDA margin (Adjusted EBITDA divided by Service revenues) 47 % 45 % 46 % 200 bps -100 bps Core Adjusted EBITDA margin (Core Adjusted EBITDA divided by Service revenues) 46 % 43 % 40 % 300 bps 300 bps (1) Stock-based compensation includes payroll tax impacts and may not agree with stock-based compensation expense on the consolidated financial statements.
Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin have limitations as analytical tools and should not be considered in isolation or as substitutes for income from operations, net income or any other measure of financial performance reported in accordance with GAAP. 41 Table of Contents 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: Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 (in millions, except percentages) 2024 2023 2022 $ Change % Change $ Change % Change Net income $ 11,339 $ 8,317 $ 2,590 $ 3,022 36 % $ 5,727 221 % Adjustments: Interest expense, net 3,411 3,335 3,364 76 2 % (29) (1) % Other (income) expense, net (113) (68) 33 (45) 66 % (101) (306) % Income tax expense 3,373 2,682 556 691 26 % 2,126 382 % Operating income 18,010 14,266 6,543 3,744 26 % 7,723 118 % Depreciation and amortization 12,919 12,818 13,651 101 1 % (833) (6) % Stock-based compensation (1) 586 644 576 (58) (9) % 68 12 % Merger-related costs (2) 121 1,034 4,969 (913) (88) % (3,935) (79) % Impairment expense — — 477 — NM (477) (100) % Legal-related (recoveries) expenses, net (3) (89) (42) 391 (47) 112 % (433) (111) % (Gain) loss on disposal group held for sale — (25) 1,087 25 (100) % (1,112) (102) % Other, net (4) 317 733 127 (416) (57) % 606 477 % Adjusted EBITDA 31,864 29,428 27,821 2,436 8 % 1,607 6 % Lease revenues (93) (312) (1,430) 219 (70) % 1,118 (78) % Core Adjusted EBITDA $ 31,771 $ 29,116 $ 26,391 $ 2,655 9 % $ 2,725 10 % Net income margin (Net income divided by Service revenues) 17 % 13 % 4 % 400 bps 900 bps Adjusted EBITDA margin (Adjusted EBITDA divided by Service revenues) 48 % 47 % 45 % 100 bps 200 bps Core Adjusted EBITDA margin (Core Adjusted EBITDA divided by Service revenues) 48 % 46 % 43 % 200 bps 300 bps (1) Stock-based compensation includes payroll tax impacts and may not agree with stock-based compensation expense on the consolidated financial statements.
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. Starting in the first quarter of 2023, we renamed Free Cash Flow to Adjusted Free Cash Flow.
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.
For more information regarding our spectrum licenses, see Note 6 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Consolidated Financial Statements.
See Note 7 – Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Consolidated Financial Statements for further information.
The summarized financial information of each obligor group is presented on a combined basis with balances and transactions within the obligor group eliminated. Investments in and the equity in earnings of non-guarantor subsidiaries, which would otherwise be consolidated in accordance with GAAP, are excluded from the below summarized financial information pursuant to SEC Regulation S-X Rule 13-01.
Investments in and the equity in earnings of non-guarantor subsidiaries, which would otherwise be consolidated in accordance with GAAP, are excluded from the below summarized financial information pursuant to SEC Regulation S-X Rule 13-01.
We continue to monitor the impact of these trends on the payment performance of our customers. 33 Table of Contents Results of Operations Set forth below is a summary of our consolidated financial results: Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 (in millions) 2023 2022 2021 $ Change % Change $ Change % Change Revenues Postpaid revenues $ 48,692 $ 45,919 $ 42,562 $ 2,773 6 % $ 3,357 8 % Prepaid revenues 9,767 9,857 9,733 (90) (1) % 124 1 % Wholesale and other service revenues 4,782 5,547 6,074 (765) (14) % (527) (9) % Total service revenues 63,241 61,323 58,369 1,918 3 % 2,954 5 % Equipment revenues 14,138 17,130 20,727 (2,992) (17) % (3,597) (17) % Other revenues 1,179 1,118 1,022 61 5 % 96 9 % Total revenues 78,558 79,571 80,118 (1,013) (1) % (547) (1) % Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below 11,655 14,666 13,934 (3,011) (21) % 732 5 % Cost of equipment sales, exclusive of depreciation and amortization shown separately below 18,533 21,540 22,671 (3,007) (14) % (1,131) (5) % Selling, general and administrative 21,311 21,607 20,238 (296) (1) % 1,369 7 % Impairment expense — 477 — (477) (100) % 477 NM (Gain) loss on disposal group held for sale (25) 1,087 — (1,112) (102) % 1,087 NM Depreciation and amortization 12,818 13,651 16,383 (833) (6) % (2,732) (17) % Total operating expenses 64,292 73,028 73,226 (8,736) (12) % (198) — % Operating income 14,266 6,543 6,892 7,723 118 % (349) (5) % Other expense, net Interest expense, net (3,335) (3,364) (3,342) 29 (1) % (22) 1 % Other income (expense), net 68 (33) (199) 101 (306) % 166 (83) % Total other expense, net (3,267) (3,397) (3,541) 130 (4) % 144 (4) % Income before income taxes 10,999 3,146 3,351 7,853 250 % (205) (6) % Income tax expense (2,682) (556) (327) (2,126) 382 % (229) 70 % Net income $ 8,317 $ 2,590 $ 3,024 $ 5,727 221 % $ (434) (14) % Statement of Cash Flows Data Net cash provided by operating activities $ 18,559 $ 16,781 $ 13,917 $ 1,778 11 % $ 2,864 21 % Net cash used in investing activities (5,829) (12,359) (19,386) 6,530 (53) % 7,027 (36) % Net cash (used in) provided by financing activities (12,097) (6,451) 1,709 (5,646) 88 % (8,160) (477) % Non-GAAP Financial Measures Adjusted EBITDA $ 29,428 $ 27,821 $ 26,924 $ 1,607 6 % $ 897 3 % Core Adjusted EBITDA 29,116 26,391 23,576 2,725 10 % 2,815 12 % Adjusted Free Cash Flow 13,586 7,656 5,646 5,930 77 % 2,010 36 % NM - Not Meaningful 34 Table of Contents The following discussion and analysis is for the year ended December 31, 2023, compared to the same period in 2022, unless otherwise stated.
We continue to monitor the impact of these trends on the payment performance of our customers. 32 Table of Contents Results of Operations Set forth below is a summary of our consolidated financial results: Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 (in millions) 2024 2023 2022 $ Change % Change $ Change % Change Revenues Postpaid revenues $ 52,340 $ 48,692 $ 45,919 $ 3,648 7 % $ 2,773 6 % Prepaid revenues 10,399 9,767 9,857 632 6 % (90) (1) % Wholesale and other service revenues 3,439 4,782 5,547 (1,343) (28) % (765) (14) % Total service revenues 66,178 63,241 61,323 2,937 5 % 1,918 3 % Equipment revenues 14,263 14,138 17,130 125 1 % (2,992) (17) % Other revenues 959 1,179 1,118 (220) (19) % 61 5 % Total revenues 81,400 78,558 79,571 2,842 4 % (1,013) (1) % Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below 10,771 11,655 14,666 (884) (8) % (3,011) (21) % Cost of equipment sales, exclusive of depreciation and amortization shown separately below 18,882 18,533 21,540 349 2 % (3,007) (14) % Selling, general and administrative 20,818 21,311 21,607 (493) (2) % (296) (1) % Impairment expense — — 477 — NM (477) (100) % (Gain) loss on disposal group held for sale — (25) 1,087 25 (100) % (1,112) (102) % Depreciation and amortization 12,919 12,818 13,651 101 1 % (833) (6) % Total operating expenses 63,390 64,292 73,028 (902) (1) % (8,736) (12) % Operating income 18,010 14,266 6,543 3,744 26 % 7,723 118 % Other expense, net Interest expense, net (3,411) (3,335) (3,364) (76) 2 % 29 (1) % Other income (expense), net 113 68 (33) 45 66 % 101 (306) % Total other expense, net (3,298) (3,267) (3,397) (31) 1 % 130 (4) % Income before income taxes 14,712 10,999 3,146 3,713 34 % 7,853 250 % Income tax expense (3,373) (2,682) (556) (691) 26 % (2,126) 382 % Net income $ 11,339 $ 8,317 $ 2,590 $ 3,022 36 % $ 5,727 221 % Statement of Cash Flows Data Net cash provided by operating activities $ 22,293 $ 18,559 $ 16,781 $ 3,734 20 % $ 1,778 11 % Net cash used in investing activities (9,072) (5,829) (12,359) (3,243) 56 % 6,530 (53) % Net cash used in financing activities (12,815) (12,097) (6,451) (718) 6 % (5,646) 88 % Non-GAAP Financial Measures Adjusted EBITDA $ 31,864 $ 29,428 $ 27,821 $ 2,436 8 % $ 1,607 6 % Core Adjusted EBITDA 31,771 29,116 26,391 2,655 9 % 2,725 10 % Adjusted Free Cash Flow 17,032 13,586 7,656 3,446 25 % 5,930 77 % NM - Not meaningful 33 Table of Contents The following discussion and analysis is for the year ended December 31, 2024, compared to the same period in 2023, unless otherwise stated.
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.
Postpaid Average Revenue Per Account Postpaid Average Revenue per Account (“ARPA”) represents the average monthly postpaid service revenue earned per account. 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.
ARPU is calculated as service revenues for the specified period divided by the average number of customers during the period, further divided by the number of months in the period.
Average Revenue Per User Average Revenue per User (“ARPU”) represents the average monthly service revenue earned per customer. ARPU is calculated as service revenues for the specified period divided by the average number of customers during the period, further divided by the number of months in the period.
The following table sets forth the churn: Year Ended December 31, Bps Change 2023 Versus 2022 Bps Change 2022 Versus 2021 2023 2022 2021 Postpaid phone churn 0.87 % 0.88 % 0.98 % -1 bps -10 bps Prepaid churn 2.76 % 2.77 % 2.83 % -1 bps -6 bps Postpaid phone churn decreased 1 basis point, primarily from improved customer retention driven by a differentiated value proposition and network experience.
The following table sets forth the churn: Year Ended December 31, Bps Change 2024 Versus 2023 Bps Change 2023 Versus 2022 2024 2023 2022 Postpaid phone churn 0.86 % 0.87 % 0.88 % -1 bps -1 bps Prepaid churn 2.73 % 2.76 % 2.77 % -3 bps -1 bps Postpaid phone churn decreased 1 basis point, primarily from improved customer retention, including the benefits of a differentiated value proposition and network experience. 39 Table of Contents Prepaid churn decreased 3 basis points, primarily from improved customer retention.
On July 25, 2023, we established 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 December 31, 2023, there was no outstanding balance under this program.
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.
For additional information regarding the 2022 Stock Repurchase Program and the 2023-2024 Stockholder Return Program, see Note 13 – Stockholder Return Programs of the Notes to the Consolidated Financial Statements. Contractual Obligations In connection with the regulatory approvals of the Transactions, we made commitments to various state and federal agencies, including the U.S. Department of Justice and FCC.
For additional information regarding the 2023-2024 Stockholder Return Program and the 2025 Stockholder Return Program, see Note 1 5 – Stockholder Return Progra ms of the Notes to the Consolidated Financial Statements. 48 Table of Contents Contractual Obligations In connection with the regulatory approvals of the Transactions, we made commitments to various state and federal agencies, including the U.S.
Restructuring costs are disclosed in Note 18 – Restructuring Costs of the Notes to the Consolidated Financial Statements. 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.
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. See “Adjusted EBITDA and Core Adjusted EBITDA” in the “ Performance Measures ” section of this MD&A.
The following table sets forth our operating measure ARPA: (in dollars) Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 2023 2022 2021 $ Change % Change $ Change % Change Postpaid ARPA $ 139.27 $ 137.43 $ 134.03 $ 1.84 1 % $ 3.40 3 % Postpaid ARPA increased slightly, primarily from: • Higher premium services, primarily high-end rate plans, net of contra-revenue for content included in such plans, and discounts for specific affinity groups, such as 55+, Military and First Responder; and • An increase in customers per account, including growth in Enterprise business and continued adoption of High Speed Internet; partially offset by • Increased promotional activity; and • An increase in High Speed Internet only accounts. 41 Table of Contents Average Revenue Per User Average Revenue per User (“ARPU”) represents the average monthly service revenue earned per customer.
The following table sets forth our operating measure ARPA: (in dollars) Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 2024 2023 2022 $ Change % Change $ Change % Change Postpaid ARPA $ 143.85 $ 139.27 $ 137.43 $ 4.58 3 % $ 1.84 1 % Postpaid ARPA increased $4.58, or 3%, primarily from: • 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; and • The impact from rate plan optimizations; partially offset by • Increased promotional activity; and • An increase in total High Speed Internet only accounts.
The following table sets forth our operating measure ARPU: (in dollars) Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 2023 2022 2021 $ Change % Change $ Change % Change Postpaid phone ARPU $ 48.83 $ 48.78 $ 47.75 $ 0.05 — % $ 1.03 2 % Prepaid ARPU 37.92 38.76 38.79 (0.84) (2) % (0.03) — % Postpaid Phone ARPU Postpaid phone ARPU was relatively flat, primarily from: • Higher premium services, primarily high-end rate plans, net of contra-revenue for content included in such plans, and discounts for specific affinity groups, such as 55+, Military and First Responders; offset by • Increased promotional activity; and • Growth in business with lower ARPU given larger account sizes.
The following table sets forth our operating measure ARPU: (in dollars) Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 2024 2023 2022 $ Change % Change $ Change % Change Postpaid phone ARPU $ 49.35 $ 48.83 $ 48.78 $ 0.52 1 % $ 0.05 — % Prepaid ARPU 36.06 37.92 38.76 (1.86) (5) % (0.84) (2) % Postpaid Phone ARPU Postpaid phone ARPU increased slightly, primarily from: • 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; and • The impact from rate plan optimizations; mostly offset by • Increased promotional activity.
During the year ended December 31, 2023, we repurchased 15,464,107 shares of our common stock at an average price per share of $144.95 for a total purchase price of $2.2 billion under the 2023-2024 Stockholder Return Program, all of which were repurchased during the three months ended December 31, 2023.
During the year ended December 31, 2024, we repurchased 59,376,922 shares of our common stock at an average price per share of $187.07 for a total purchase price of $11.1 billion, all of which were purchased under the 2023-2024 Stockholder Return Program.
We also committed to make payments totaling $700 million under an IP transit services agreement, consisting of (i) $350 million in equal monthly installments during the first year after the closing of the Wireline Transaction and (ii) $350 million in equal monthly installments over the subsequent 42 months (the transactions as contemplated by the Wireline Sale Agreement and the IP transit services agreement are collectively referred to as the “Wireline Transaction”).
Under the terms of the Wireline Sale Agreement, the Company agreed to make payments pursuant to an IP transit services agreement totaling $700 million, consisting of (i) $350 million in equal monthly installments during the first year after the closing and (ii) $350 million in equal monthly installments over the subsequent 42 months.
Together, the licenses with closings deferred into the second closing tranche represent approximately $1.1 billion of the aggregate $3.5 billion cash consideration. The FCC approved the purchase of the first tranche on December 29, 2023, and we expect the closing of the first tranche to occur in the second quarter of 2024.
Together, the licenses with closings deferred into the second closing tranche represent approximately $1.1 billion of the aggregate $3.5 billion cash consideration. The FCC approved the purchase of the first tranche on December 29, 2023. The first tranche closed on June 24, 2024, and the associated payment of $2.4 billion was made on August 5, 2024.
Financing Activities Net cash used in financing activities increased $5.6 billion, or 88%.
Financing Activities Net cash used in financing activities increased $718 million, or 6%.
The indentures, supplemental indentures and credit agreements governing the long-term debt 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. 37 Table of Contents Basis of Presentation The following tables include summarized financial information of the obligor groups of debt issued by T-Mobile USA, Inc., Sprint and Sprint Capital Corporation.
The indentures, supplemental indentures and credit agreements governing the long-term debt 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 to merge, consolidate or sell, or otherwise dispose of, substantially all of their assets.
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. The 2023-2024 Stockholder Return Program consists of additional repurchases of shares of our common stock and the payment of cash dividends.
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 is expected to consist of additional repurchases of shares of our common stock and the payment of cash dividends.
Postpaid Net Account Additions The following table sets forth the number of postpaid net account additions: Year Ended December 31, 2023 Versus 2022 2022 Versus 2021 (in thousands) 2023 2022 2021 # Change % Change # Change % Change Postpaid net account additions 1,271 1,436 1,188 (165) (11) % 248 21 % 39 Table of Contents Postpaid net account additions decreased 165,000, or 11%, primarily from: • Continued moderation of industry growth; • Higher postpaid account deactivations from a growing customer base; and • Fewer High Speed Internet only net account additions.
Postpaid Net Account Additions The following table sets forth the number of postpaid net account additions: Year Ended December 31, 2024 Versus 2023 2023 Versus 2022 (in thousands) 2024 2023 2022 # Change % Change # Change % Change Postpaid net account additions 1,097 1,271 1,436 (174) (14) % (165) (11) % Postpaid net account additions decreased 174,000, or 14%, for the year ended December 31, 2024, primarily from fewer High Speed Internet only additions.
Certain commitments and obligations are included in the table based on the year of required payment or an estimate of the year of payment. Other long-term liabilities have been omitted from the table above due to the uncertainty of the timing of payments, combined with the lack of historical trends to predict future payments.
Other long-term liabilities have been omitted from the table above due to the uncertainty of the timing of payments, combined with the lack of historical trends to predict future payments.
Management believes analysts and investors use Adjusted EBITDA and Core Adjusted EBITDA as supplemental measures to evaluate overall operating performance and to facilitate comparisons with other wireless communications services companies because they are indicative of our ongoing operating performance and trends by excluding the impact of interest expense from financing, non-cash depreciation and amortization from capital investments, stock-based compensation, Merger-related costs, including network decommissioning costs, impairment expense, loss and gain on disposal groups held for sale and certain legal-related recoveries and expenses, as well as other special income and expenses, including severance and related costs associated with the August 2023 workforce reduction, which are not reflective of our core business activities.
Management believes analysts and investors use Adjusted EBITDA and Core Adjusted EBITDA as supplemental measures to evaluate overall operating performance and to facilitate comparisons with other wireless communications services companies because they are indicative of our ongoing operating performance and trends by excluding the impact of interest expense from financing, non-cash depreciation and amortization from capital investments, non-cash stock-based compensation, and Special Items.
Additionally, on September 12, 2023, we entered into a License Purchase Agreement to acquire spectrum in the 600 MHz band from Comcast in exchange for total cash consideration of between $1.2 billion and $3.3 billion. The agreement remains subject to an application for FCC approval. Total consideration for these License Purchase Agreements is excluded from our reported purchase obligations above.
On September 12, 2023, we entered into a License Purchase Agreement to acquire spectrum in the 600 MHz band from Comcast in exchange for total cash consideration of between $1.2 billion and $3.3 billion. On January 13, 2025, we and Comcast entered into an amendment to the License Purchase Agreement pursuant to which we will acquire additional spectrum.
Additionally, certain stock-based compensation expenses associated with the Transactions have been included in Merger-related costs. (2) Legal-related (recoveries) expenses, net, consists of the settlement of certain litigation associated with the August 2021 cyberattack and is presented net of insurance recoveries.
(3) Legal-related (recoveries) expenses, net, consists of the settlement of certain litigation associated with the August 2021 cyberattack and is presented net of insurance recoveries.
We use Adjusted EBITDA and Core Adjusted EBITDA as benchmarks to evaluate our operating performance in comparison to our competitors.
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. We use Adjusted EBITDA and Core Adjusted EBITDA as benchmarks to evaluate our operating performance in comparison to our competitors.
During the year ended December 31, 2023, we issued long-term debt for net proceeds of $8.4 billion and redeemed and repaid short-term debt with an aggregate principal amount of $5.1 billion.
During the year ended December 31, 2024, we issued long-term debt for net proceeds of $8.6 billion and repaid short-term debt with an aggregate principal amount of $5.1 billion. For more information regarding our debt financing transactions, see Note 9 – Debt of the Notes to the Consolidated Financial Statements.
During the years ended December 31, 2023 and 2022, there were no significant net cash proceeds from securitization. Borrowing Capacity We maintain a revolving credit facility (the “Revolving Credit Facility”) with an aggregate commitment amount of $7.5 billion. As of December 31, 2023, there was no outstanding balance under the Revolving Credit Facility.
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 December 31, 2024, there was no outstanding balance under the Revolving Credit Facility.
The increase was primarily from: • Higher Total service revenues; • Lower Cost of equipment sales, excluding Merger-related costs; and • Lower Cost of services, excluding Merger-related costs and other special items, such as severance and related costs associated with the August 2023 workforce reduction; partially offset by • Lower Equipment revenues, excluding lease revenues.
The increase was primarily from: • Higher Total service revenues; • Higher Equipment revenues, excluding lease revenues; and • Lower Cost of services, excluding Special Items; partially offset by • Higher Selling, general and administrative expenses, excluding Special Items; and • Higher Cost of equipment sales, excluding Special Items.
The following table sets forth the number of ending postpaid accounts: As of December 31, 2023 Versus 2022 2022 Versus 2021 (in thousands) 2023 2022 2021 # Change % Change # Change % Change Postpaid accounts (1) (2) 29,797 28,526 27,216 1,271 4 % 1,310 5 % (1) Customers impacted by the decommissioning of the legacy Sprint CDMA and LTE and T-Mobile UMTS networks have been excluded from our postpaid account base resulting in the removal of 57,000 postpaid accounts in the first quarter of 2022 and 69,000 postpaid accounts in the second quarter of 2022.
Postpaid accounts generally consist of customers that are qualified for postpaid service utilizing phones, High Speed Internet modems, mobile internet devices (including tablets and hotspots), wearables, DIGITS and other connected devices (including SyncUP and IoT), where they generally pay after receiving service. 37 Table of Contents The following table sets forth the number of ending postpaid accounts: As of December 31, 2024 Versus 2023 2023 Versus 2022 (in thousands) 2024 2023 2022 # Change % Change # Change % Change Postpaid accounts (1) 30,894 29,797 28,526 1,097 4 % 1,271 4 % (1) Customers impacted by the decommissioning of the legacy Sprint CDMA and LTE and T-Mobile UMTS networks have been excluded from our postpaid account base resulting in the removal of 57,000 postpaid accounts in the first quarter of 2022 and 69,000 postpaid accounts in the second quarter of 2022.
Net income , the components of which are discussed above, was $8.3 billion and $2.6 billion for the years ended December 31, 2023 and 2022, respectively.
Our effective tax rate was 22.9% and 24.4% for the years ended December 31, 2024 and 2023, respectively. 35 Table of Contents Net income , the components of which are discussed above, was $11.3 billion and $8.3 billion for the years ended December 31, 2024 and 2023, respectively.
Subsequent to December 31, 2023, 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 is payable on March 14, 2024, to stockholders of record as of the close of business on March 1, 2024.
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 will be paid on March 13, 2025, to stockholders of record as of the close of business on February 28, 2025.
The licenses are subject to an exclusive leasing arrangement between us and Comcast entered into contemporaneously with the License Purchase Agreement. We anticipate the closing will occur in the first half of 2028.
The licenses are subject to an exclusive leasing arrangement between us and Comcast entered into contemporaneously with the License Purchase Agreement. On January 13, 2025, we and Comcast entered into an amendment to the License Purchase Agreement pursuant to which we will acquire additional spectrum.
Subsequent to December 31, 2023, from January 1, 2024, through January 31, 2024, we repurchased 9,024,185 shares of our common stock at an average price per share of $162.98 for a total purchase price of $1.5 billion.
Subsequent to December 31, 2024, from January 1, 2025, through January 24, 2025, we repurchased 2,855,113 shares of our common stock at an average price per share of $216.03 for a total purchase price of $617 million under the 2025 Stockholder Return Program.
Performance Measures In managing our business and assessing financial performance, we supplement the information provided by our consolidated financial statements with other operating or statistical data and non-GAAP financial measures. 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.
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.
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 January 31, 2024, over approximately 58.1% of the outstanding T-Mobile common stock. 49 Table of Contents Disclosure of Iranian Activities under Section 13(r) of the Exchange Act Section 219 of the Iran Threat Reduction and the Syria Human Rights Act of 2012 added Section 13(r) to the Exchange Act.
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 January 24, 2025, over approximately 58.7% of the outstanding T-Mobile common stock.
Prepaid ARPU Prepaid ARPU decreased $0.84, or 2%, primarily from dilution from promotional rate plan mix. 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 income and expenses not reflective of our ongoing operating performance.
Prepaid ARPU Prepaid ARPU decreased $1.86, or 5%, primarily from the inclusion of lower ARPU prepaid customers associated with the Ka’ena Acquisition. 40 Table of Contents 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”).
In addition, Wholesale and other service revenues are expected to continue to decline due to the migration by Verizon of legacy TracFone customers off of the T-Mobile network and as DISH services more of its Boost customers with their standalone network. 32 Table of Contents Operating Expense Trends In 2024, we expect Total operating expenses to increase, primarily driven by higher Depreciation and amortization from assets placed into service associated with the accelerated build-out of our nationwide 5G network and the acceleration of certain technology assets as we continue to modernize our network and technology systems and platforms, as well as higher Cost of equipment sales, driven by higher expected unit sales from a growing customer base.
Operating Expense Trends In 2025, we expect Total operating expenses to increase, primarily driven by higher Depreciation and amortization from assets placed into service associated with our continued build-out of our nationwide 5G network, a s well as higher Cost of equipment sales, driven by higher expected unit sales from a growing customer base.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+1 added−0 removed2 unchanged
Biggest changeSee Note 8 – Debt of the Notes to the Consolidated Financial Statements for additional information. 51 Index for Notes to the Consolidated Financial Statements
Biggest changeSee Note 9 – Debt of the Notes to the Consolidated Financial Statements for additional information. 52 Index for Notes to the Consolidated Financial Statements
We do not foresee significant changes in the strategies used to manage market risk in the near future. Certain potential sources of financing available to us, including our Revolving Credit Facility, bear interest that is indexed to a benchmark rate plus a fixed margin. As of December 31, 2023, we did not have outstanding balances under these facilities.
We do not foresee significant changes in the strategies used to manage market risk in the near future. Certain potential sources of financing available to us, including our Revolving Credit Facility, bear interest that is indexed to a benchmark rate plus a fixed margin. As of December 31, 2024, we did not have outstanding balances under these facilities.
Added
As of December 31, 2024, we held €2.0 billion in EUR-denominated Senior Notes, which are subject to foreign currency exchange rate fluctuations. We have entered into cross-currency swap agreements that qualify and have been designated as fair value hedges of our EUR-denominated debt, mitigating our exposure to foreign currency transaction gains and losses.

Other TMUS 10-K year-over-year comparisons