T-Mobile updates long-term synergy expectations from UScellular transaction

T-Mobile (TMUS) provided updated customer and financial guidance as applicable after incorporating the impacts of the UScellular transaction, which closed on August 1. The company is also providing a brief update on additional business transformation initiatives. T-Mobile now expects the UScellular transaction to yield approximately $1.2B in total annual run rate cost synergies upon integration, an increase of 20% from the original approximately $1B run rate synergy guidance, now comprised of approximately $950M in operational expense and approximately $250M in capital expenditure run rate synergies. The integration is now expected to be achieved in approximately two years, an acceleration from the original three-to-four-year expectation. Costs to achieve are expected to be approximately $2.6B, within the original guidance range and T-Mobile continues to plan to reinvest a portion of synergies toward enhancing consumer choice, quality and competition in the wireless industry. For Q3, T-Mobile expects the following financial impacts from the UScellular acquisition: service revenues of approximately $400M, core adjusted EBITDA of approximately $125M, approximately $100M in costs to achieve as the company begins an accelerated integration process, which are excluded from core adjusted EBITDA and approximately $175M in depreciation and amortization expenses. Acquisition of the lower Postpaid ARPA UScellular base, together with postpaid accounts acquired from the Metronet joint venture also with lower Postpaid ARPA, will impact consolidated T-Mobile Postpaid ARPA by approximately $1.50 in Q3. Excluding UScellular and Metronet, T-Mobile’s underlying business continues to see strong Postpaid ARPA growth, with ongoing expectations for full year 2025 versus 2024 growth of at least 3.5%.