T-Mobile releases its Q1 earnings and reveals why a record number switched to the carrier
T-Mobile releases its first earnings report without an important industry metric.
T-Mobile reports Q1 earnings. | Image by PhoneArena
For the first time in the history of T-Mobile, the carrier released its first quarterly earnings figure this afternoon without divulging the important net new postpaid phone adds. The metric is very important and is used by analysts to determine how well a wireless firm is doing at the moment.
T-Mobile's first earnings report without a key number
Postpaid subscribers are less likely to continually look to switch providers, but the company wanted to focus on multi-line accounts noting that over 90% of its postpaid subscribers are part of multi-line family or business accounts. That falls right in line with the carrier's attempt to get more subscribers to bundle their 5G wireless, home internet, and other services.
Starting with today's Q1 report, T-Mobile will focus on postpaid account additions for families and businesses, ARPA (average revenue per account), and Churn. For example, the carrier reported 217,000 postpaid net new account additions, up 6% year-over-year. Postpaid ARPA rose 3.9% year-over-year to $151.93.
This is why a record number of switchers are moving to T-Mobile
T-Mobile says that a record number of recent switchers to T-Mobile made the choice because of the wireless provider's network quality. This proves that the perception that T-Mobile's network is constantly improving is driving them to move to T-Mobile.
Q1 marked a strong start to the year as we continue to execute against our ambitious 2026 and 2027 targets, representing yet another proof point of our winning formula and unique differentiation. We reported accelerating postpaid net account growth and strong postpaid ARPA growth, reflecting this team’s differentiated ability to not only attract new customer relationships but also deepen the engagement with our existing base. This drove the outsized results you see, including industry-leading financial growth. We’re more confident than ever in our strategy and the opportunities ahead of us, supported by the industry’s best growth portfolio in core wireless, broadband, and smart adjacencies. The best truly lies ahead of us.
Srini Gopalan, CEO, T-Mobile
The carrier analyzed data from Ookla and found that T-Mobile is the fastest provider in Fixed Wireless Home Internet with median download speeds over 50% faster than its next rival. For the first quarter, postpaid churn was 1.04%, unchanged from the previous quarter and up 10 basis points from the .94% reported for the same quarter last year. That could be seen as an indication that customers are leaving T-Mobile.
T-Mobile is transitioning into a digital carrier
This is an important development as the carrier is in the middle of its transition to a digital carrier with all transactions made through the T-Life app. Even monthly invoices are now paid via the app. As a result, we expect to see T-Mobile close stores and lay off reps allowing the company to stop paying leases and commissions.
Today's earnings report was the second under new CEO Srini Gopalan. | Image by T-Mobile
For the first quarter of 2026, service revenue rose 11% to $18.8 billion while postpaid service revenues increased 15% year-over-year to $15.6 billion. On an annual basis, net income declined 15% to $2.5 billion which included the cost of merging with UScellular. T-Mobile's first quarter diluted earnings per share (which includes the conversion into equity of all convertible debt) declined 12% year-over-year to $2.27.
Which carrier will be considered the best by 2028?
T-Mobile hiked its forecast for 2026 postpaid net account additions to somewhere between 950 thousand and 1.05 million. That is an increase of its previous forecast of 900 thousand to 1.0 million.
How the stock reacted to today's report
After declining sharply on Monday, T-Mobile rebounded on Tuesday by rising by $3.97 or 2.19% to $186.72. The stock rose some more in after-hours trading, up an additional $3.09 or 1.65% to $189.81 once the earnings were released.
Today's release was the second earnings report announced by T-Mobile under the leadership of CEO Srini Gopalan who replaced Mike Sievert as CEO on November 1st.
Popular stories
Latest News
Things that are NOT allowed:
To help keep our community safe and free from spam, we apply temporary limits to newly created accounts: