In the immediate two acquisitions,

T-Mobile added 1.2 million net customers to its phone and internet operations in the first quarter of 2024,

the company reported during its Q1 results call on Thursday.

The first acquisition was the eagerly anticipated $1.35 billion purchase of prepaid provider Mint Mobile, which was approved by the US Federal Communications Commission yesterday. This completed the process that had started when T-Mobile initially announced it a year ago. Additionally, the carrier disclosed yesterday that it has formed a joint venture with investment firm EQT to invest $950 million in purchasing fiber internet provider Lumos. This acquisition will grant the carrier access to Lumos’ network, which provides wired and Wi-Fi connectivity to 320,000 households on the US East Coast.

With these acquisitions, T-Mobile is increasing its commitment in two areas: wired internet and prepaid phone subscriptions, the latter of which it had previously mainly given up to competitors AT&T and Verizon. In other words, AT&T had more than 8.5 million wired broadband customers at the end of the first quarter, compared to Verizon’s 7.2 million. T-Mobile stated in a blog post that in order to catch up, it will spend an additional $500 million between 2027 and 2028 to expand the Lumos network to 3.5 million total households by the end of the latest year.

The management team of Lumos was praised by T-Mobile CEO Mike Sievert for their “years of experience building fiber in an efficient, cost-effective, and targeted build model” during the results call. We can’t wait to expand on the work Lumos has been doing in the next years in order to reach an increasing number of families.”

Alongside this expansion, T-Mobile experienced more typical growth in the segments in which it has always competed, such as mobile. 532,000 postpaid net subscribers were added by the carrier (a tiny decrease of 6,000 from the first quarter of 2023). This is a metric that the industry uses to indicate success and consistent revenue. While individuals are keeping their phones longer—roughly 2.4% of customers upgraded during the quarter—T-Mobile Consumer Group president Jon Freier pointed out during the call that the percentage of customers canceling their subscriptions was at an all-time low.

“It’s really kind of the best of both worlds when you have customers that are staying at incredible rates, record low rates, and not staying for free devices exclusively,” Freier stated. “They’re staying for this differentiated value proposition, the network, and the overall experience.”

According to Sievert, 75% of postpaid users had 5G phones, which allowed them to take advantage of all the network has to offer without having to upgrade. “So the impetus when you’re having a fantastic experience on your phone, to prematurely swap it out, just isn’t there,” he explained.

During the quarter, the carrier recorded a loss of 48,000 prepaid net customers (including phone and internet), representing a 74,000 customer decline in comparison to the 26,000 new customers recruited during the same time the previous year. This is still less than the 132,000 prepaid phone losses that AT&T and Verizon experienced, which totaled 216,000.

While sunsetting the discounts from the service’s debut era, Sievert recognized that its fixed wireless access base continued to grow since it was “attracting customers at our nominal price points.” In the first quarter of 2023, T-Mobile added 523,000 FWA users; in the same period, it added 405,000 FWA customers. There were 5.2 million users of the carrier’s internet service at the end of the current period.
T-Mobile increased its revenue by 4% to $16.1 billion during the quarter compared to the same period in the previous year. Compared to the $1.58 per share received in the first quarter of 2023, this amounted to $2 earned per share, a 27% increase.

By the end of the day, T-Mobile’s stock had decreased by 0.05%.

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