Slide 1: Together We Are Unstoppable: Investor Factbook Q4 2021
TOGETHER WE ARE UNSTOPPABLE _INVESTOR ew & ew FACTBOOK Q4 2021
Slide 2: Table of Contents
2 3 Highlights 4 Customer Metrics 7 Financial Metrics 13 Capital Structure 14 5G Network Leadership 16 Merger & Integration 17 Guidance 18 Contacts 19 Financial and Operational Tables The results and analysis presented below include the impact of T-Mobile’s merger (“Merger”) with Sprint Corporation
Slide 3: Highlights: Industry-Leading Service Revenue and Cash Flow Growth, Exceeds 2021 Guidance
3 T-Mobile’s Unique Formula Delivers Industry-Leading Service Revenue and Cash Flow Growth and Exceeds 2021 Guidance Unrivaled 5G Network Leadership and Best Value Combined with Industry-Leading Postpaid Customer Growth Set Up Strong 2022 Outlook Industry-Leading and Record-High Postpaid Account and
Slide 4: Postpaid Accounts and Total Postpaid Net Additions
4 Postpaid Accounts Postpaid net account additions were 315 thousand in Q4 (in thousands) 2021, compared to 268 thousand in Q3 2021 and 131 thousand in Q4 2020, as we continue our focus on growing 26,363 26,901 27,216 new relationships with businesses and consumers, including 25,754 26,014 those in
Slide 5: Postpaid Phone Churn; Postpaid ARPA and ARPU
5 Postpaid Phone Churn Postpaid phone churn was 1.10% in Q4 2021, up 14 basis points from 0.96% in Q3 2021 and up 7 basis points from 1.03% in Q4 2020. 1.10% 1.03% 0.98% ▪ Sequentially, the increase was primarily due to 0.96% 0.87% seasonality and elevated Sprint churn during the accelerated integra
Slide 6: Total Prepaid Net Additions; High Speed Internet Net Additions
6 Total Prepaid Net Additions Prepaid net customer additions were 49 thousand in Q4 2021, compared to 66 thousand in Q3 2021 and 84 (in thousands) thousand in Q4 2020. ▪ Sequentially and year-over-year, the decrease was primarily driven by higher churn and migrations to postpaid plans, partially off
Slide 7: Service Revenues and Equipment Revenues
7 Service Revenues Service revenues were $15.0 billion in Q4 2021, up 2% from $14.7 billion in Q3 2021 and up 6% from $14.2 billion in ($ in millions) Q4 2020. ▪ Sequentially and year-over-year, the increase was primarily due to an increase in Postpaid revenues, driven $14,963 $14,722 by higher aver
Slide 8: Cost of Services and Cost of Equipment Sales
8 Cost of Services, exclusive of D&A Cost of services, exclusive of depreciation and ($ in millions, % of Service revenues) amortization (D&A), was $3.5 billion in Q4 2021, relatively flat compared to $3.5 billion in Q3 2021 and down 8% from $3,827 $3.8 billion in Q4 2020. $3,384 $3,491 $3,538 $3,52
Slide 9: Selling, General and Administrative Expense
9 Selling, General and Administrative Selling, general and administrative (SG&A) expense was $5.4 billion in Q4 2021, up 4% from $5.2 billion in Q3 2021 (SG&A) Expense and up 13% from $4.8 billion in Q4 2020. ($ in millions, % of Service revenues) ▪ Sequentially, the increase was primarily driven by
Slide 10: Net Income and Diluted EPS
10 Net Income Net income was $422 million in Q4 2021, down 39% from ($ in millions) $691 million in Q3 2021 and down 44% from $750 million in Q4 2020. Diluted EPS was $0.34 in Q4 2021, down from $0.55 in Q3 2021 and down from $0.60 in Q4 2020. ▪ Sequentially, the decrease in Net income and diluted E
Slide 11: Core Adjusted EBITDA; Net Cash from Operating Activities
11 Core Adjusted EBITDA Core Adjusted EBITDA was $5.7 billion in Q4 2021, down ($ in millions, % of Service revenues) 6% from $6.0 billion in Q3 2021 and up 3% from $5.5 billion in Q4 2020. $6,041 ▪ Sequentially, the decrease was primarily due to $5,864 $5,992 $5,679 seasonally higher Cost of equipm
Slide 12: Cash Purchases of Property and Equipment; Free Cash Flow
12 Cash Purchases of Property and Cash purchases of property and equipment were $2.9 billion in Q4 2021, compared to $2.9 billion in Q3 2021 and Equipment $3.8 billion in Q4 2020. Capitalized interest included in cash ($ in millions, % of Service revenues) purchases of property and equipment was $23
Slide 13: Net Debt and Net Debt to LTM Core Adjusted EBITDA Ratio
13 Net Debt (Excluding Tower Total debt, excluding tower obligations, at the end of Q4 2021 was $76.8 billion. Obligations) & Net Debt to LTM Core Adj. EBITDA Ratio Net debt, excluding tower obligations, at the end of Q4 ($ in billions) 2021 was $70.1 billion. ▪ The ratio of net debt, excluding towe
Slide 14: 5G Network Leadership: Our 5G Network Continues to Pull Further Ahead
5G Network Leadership Our 5G Network Continues to Pull Further Ahead 5G Geographic Coverage S it e S Combined LTE + 5G Macro Cell Sites 5G 5G UC Small cell/distributed antenna systems sites Nearly 5x more geographic coverage than Verizon and nearly 2x more than AT&T Mid-band and Millimeter Wave aNGE
Slide 15: 5G Network Leadership: The Most Awarded 5G Network in the U.S.
-/* 5G Network Leadership 15 The Most Awarded 5G Network in the U.S. T-Mobile customers enjoy the fastest average 5G download and upload speeds and can connect to 5G more often and in more places than anyone else. The gap over competitors has gotten wider as T-Mobile’s average 5G download speed is m
Slide 16: ~$3.8B in Merger Synergies Delivered in 2021
16 T-Mobile delivered ~$3.8B in Merger synergies in 2021, nearly tripling year-over-year and exceeding guidance. The Company realized full-year 2021 Merger synergies in 2021 of $3.8 billion, comprised of the following: ▪ Over $1.8 billion of SG&A expense reductions. ▪ Over $900 million of cost of se
Slide 17: 2022 Outlook
17 2022 Outlook Postpaid net customer additions 5.0 to 5.5 million Net income (1) N/A Core Adjusted EBITDA (2) $25.6 to $26.1 billion Merger synergies $5.0 to $5.3 billion Merger-related costs (3) $4.5 to $5.0 billion Net cash provided by operating activities $15.5 to $16.1 billion Capital expenditu
Slide 18: Investor Relations
18 Investor Relations Jud Henry Justin Taiber Trina Schurman Senior Vice President Senior Director Senior Director Investor Relations Investor Relations Investor Relations Samia Bhatti Zach Witterstaetter Rose Kopecky Jacob Marks Investor Relations Investor Relations Investor Relations Investor Rela
Slide 19: Consolidated Balance Sheets
19 T-Mobile US, Inc. Consolidated Balance Sheets (in millions, except share and per share amounts) December 31, 2021 December 31, 2020 Assets Current assets Cash and cash equivalents $ 6,631 $ 10,385 Accounts receivable, net of allowance for credit losses of $146 and $194 4,167 4,254 Equipment insta
Slide 20: Consolidated Statements of Comprehensive Income
20 T-Mobile US, Inc. Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended Year Ended December 31, December 31, September 30, December 31, (in millions, except share and per share amounts) 2021 2021 2020 2021 2020 Revenues Postpaid revenues $ 10,963 $ 10,804 $ 10,251 $ 42,56
Slide 21: Consolidated Statements of Cash Flows
21 T-Mobile US, Inc. Consolidated Statements of Cash Flows (Unaudited) Three Months Ended Year Ended December 31, December 31, September 30, December 31, (in millions) 2021 2021 2020 2021 2020 Operating activities Net income $ 422 $ 691 $ 750 $ 3,024 $ 3,064 Adjustments to reconcile net income to ne
Slide 22: Consolidated Statements of Cash Flows (Continued)
22 T-Mobile US, Inc. Consolidated Statements of Cash Flows (Continued) (Unaudited) Three Months Ended Year Ended December 31, December 31, September 30, December 31, (in millions) 2021 2021 2020 2021 2020 Supplemental disclosure of cash flow information Interest payments, net of amounts capitalized
Slide 23: Supplementary Operating and Financial Data
23 T-Mobile US, Inc. Supplementary Operating and Financial Data (Unaudited) Year Ended Quarter December 31, (in thousands) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2020 2021 Customers, end of period Postpaid phone customers (1)(2) 40,797 65,105 65,794 66,618 67,402 68,029 69,4
Slide 24: Supplementary Operating and Financial Data
24 T-Mobile US, Inc. Supplementary Operating and Financial Data (Unaudited) Year Ended Quarter December 31, (in thousands) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2020 2021 Net account additions Postpaid net account additions 197 101 137 131 257 348 268 315 566 1,188 Year End
Slide 25: Supplementary Operating and Financial Data (continued)
25 T-Mobile US, Inc. Supplementary Operating and Financial Data (continued) (Unaudited) Year Ended Quarter December 31, (in millions, except percentages) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2020 2021 Financial Measures Service revenues $ 8,846 $13,230 $14,139 $14,180 $14,
Slide 26: Calculation of Operating Measures
26 T-Mobile US, Inc. Calculation of Operating Measures (Unaudited) The following table illustrates the calculation of our operating measures ARPA and ARPU from the related service revenues: Year Ended (in millions, except average number of Quarter December 31, accounts and customers, ARPA and ARPU)
Slide 27: Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures
27 T-Mobile US, Inc. Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures (Unaudited) This Investor Factbook includes non-GAAP financial measures. The non-GAAP financial measures should be considered in addition to, but not as a substitute for, the information provided in accorda
Slide 28: Reconciliation of Non-GAAP Financial Measures to GAAP (continued)
28 T-Mobile US, Inc. Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures (continued) (Unaudited) Net debt (excluding tower obligations) to the LTM Adjusted EBITDA and LTM Core Adjusted EBITDA ratios are calculated as follows: Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 3
Slide 29: Reconciliation of Non-GAAP Measures: Free Cash Flow Guidance
29 T-Mobile US, Inc. Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures (continued) (Unaudited) Our guidance range for Free Cash Flow is calculated as follows: FY 2022 (in millions) Guidance Range Net cash provided by operating activities $ 15,500 $ 16,100 Cash purchases of pro
Slide 30: Reconciliations to Beginning Customers and Accounts
30 T-Mobile US, Inc. Reconciliations to Beginning Customers and Accounts (Unaudited) Postpaid Postpaid Total phone other postpaid Prepaid Total (in thousands) customers customers customers customers customers Reconciliation to beginning customers T-Mobile customers as reported, end of period March 3
Slide 31: Pro Forma Income Statement Metrics
31 T-Mobile US, Inc. Pro Forma Income Statement Metrics (Unaudited) The following tables present certain income statement metrics on a pro forma basis as though the Merger had been completed on January 1, 2019. The unaudited pro forma income statement metrics have been prepared in accordance with Ar
Slide 32: Pro Forma Income Statement Metrics (Continued)
32 T-Mobile US, Inc. Pro Forma Income Statement Metrics (Continued) (Unaudited) Three Months Ended September December March 31, (in millions) 30, 2019 31, 2019 2020 Depreciation and amortization Combined depreciation and amortization (1) $ 3,882 $ 4,332 $ 4,061 Pro forma adjustments (5) 202 (210) (4
Slide 33: Pro Forma Income Statement Metrics (Continued)
33 T-Mobile US, Inc. Pro Forma Income Statement Metrics (Continued) (Unaudited) (1) Represents the sum of historically filed T-Mobile and Sprint standalone GAAP reported amounts. Please reference the T-Mobile Quarterly Reports on Form 10-Q for the quarterly period ended March 31, 2020 and the Curren
Slide 34: Definitions of Terms
34 Definitions of Terms Operating and financial measures are utilized by T-Mobile’s management to evaluate its operating performance and, in certain cases, its ability to meet liquidity requirements. Although companies in the wireless industry may not define measures in precisely the same way, T-Mob
Slide 35: Cautionary Statement Regarding Forward-Looking Statements
35 Cautionary Statement Regarding Forward-Looking Statements This communication includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including information concerning T-Mobile US, Inc.’