T-Mobile Projects Strong Financial Growth and Increased Dividends Through 2027

T-Mobile forecasts adjusted free cash flow up to $19 billion in 2027

In July, it added 777,000 postpaid phone customers, which was the highest in the industry for the second quarter. T-Mobile said on Wednesday it expects to return up to $50 billion to shareholders through 2027 via a combination of share buybacks and dividends. Analyst had expected the company to report adjusted free cash flow of $18.9 billion for 2027, according to Visible Alpha. The company also forecast core adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to be between $38 billion and $39 billion in 2027. T-Mobile expects to add 12 million 5G broadband customers by 2028, CEO Mike Sievert said. The company said it will work with OpenAI to launch a new AI decision making platform called IntentCX for more personalized customer solutions. T-Mobile also announced a collaboration with Nvidia, Ericsson, and Nokia to design mobile networks using AI. "The investments we make in all of our future network capabilities fit within the $9 to $10 billion capex envelope that we're outlining," Sievert added. The company's shares, which have gained more than 20% so far this year, closed down 2.97% at $196.68. (Reporting by Harshita Mary Varghese in Bengaluru; Editing by Alan Barona and Shounak Dasgupta)

T-Mobile forecasts adjusted free cash flow up to $19 billion in 2027

(Reuters) -T-Mobile said on Wednesday it expects adjusted free cash flow between $18 billion and $19 billion in 2027 as the telecom operator laid out a three-year growth plan at its Capital Markets Day event in San Francisco. The company outlined its expectations for growth on the back of strong customer additions, as well as new tech collaborations with AI chip firm Nvidia and ChatGPT maker OpenAI. T-Mobile, one of the top three carriers in the United States, has seen increased adoption of its premium plans that offer streaming packages along with unlimited offerings. In July, it added 777,000 postpaid phone customers, which was the highest in the industry for the second quarter. T-Mobile said on Wednesday it expects to return up to $50 billion to shareholders through 2027 via a combination of share buybacks and dividends. Analyst had expected the company to report adjusted free cash flow of $18.9 billion for 2027, according to Visible Alpha. The company also forecast core adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to be between $38 billion and $39 billion in 2027. T-Mobile expects to add 12 million 5G broadband customers by 2028, CEO Mike Sievert said. The company said it will work with OpenAI to launch a new AI decision making platform called IntentCX for more personalized customer solutions. T-Mobile also announced a collaboration with Nvidia, Ericsson, and Nokia to design mobile networks using AI. "The investments we make in all of our future network capabilities fit within the $9 to $10 billion capex envelope that we're outlining," Sievert added. The company's shares, which have gained more than 20% so far this year, closed down 2.97% at $196.68. (Reporting by Harshita Mary Varghese in Bengaluru; Editing by Alan Barona and Shounak Dasgupta)

T-Mobile Sees Revenue Growth Through 2027 From New Business Framework, Increases Dividend

T-Mobile announced a three-year plan that outlines a framework for future revenue opportunities and continues the company's transformation into an artificial-intelligence-enabled, data-informed and digital-first organization. Under the plan, the carrier on Wednesday guided for service revenue between $75 billion and $76 billion in 2027, representing a compound annual growth rate of approximately 5%. This revenue increase will be driven by more wireless and broadband customers, a higher average revenue per account and the launch of new businesses, the company said. Also in 2027 and excluding its pending acquisitions of UScellular, Metronet and Lumos, the company expects core adjusted earnings before interest, taxes, depreciation and amortization between $38 million and $39 million, boosted by operating efficiencies through technology innovation, AI and digital leadership. Adjusted free cash flow is expected to be between $18 billion and $19 billion. Separately, T-Mobile's board on Wednesday raised its cash dividend 35%, to 88 cents. The increased dividend, equal to $3.52 a year, represents an annual yield of about 1.7% based on Tuesday's closing price of $202.70. It will be paid Dec. 12 to shareholders of record as of Nov. 27. The San Francisco company now aims to reach 12 million 5G broadband customers by 2028 using excess capacity. It previously targeted reaching between 7 million and 8 million customers by 2025. T-Mobile expects to reach between 12 million and 15 million households passed by the end of 2030 with its fiber partnerships, resulting in an all-in internal rate of return of around 20% from its fiber joint ventures. The company will fund its plan with between $9 billion to $10 billion in annual capital expenditures, in addition to ongoing investments in core business growth and evolution, it said. Additionally, the company said it will aim to grow new businesses, such as advertising and T-Priority, a service which gives first responder agencies priority on the carrier's network. The company also guided its T-Mobile for Business unit to deliver double-digit service revenue compound annual growth rate from 2023 to 2027, boosted by the deployment of enhanced digital tools and an extension to small-to-mid market companies.