T-Mobile on Thursday reported fewer new wireless subscribers than Wall Street expected for the first quarter (Q1) of 2025, as intensified competition in the U.S. telecom market pressured customer acquisition.
The company added 495,000 postpaid phone customers during the quarter, missing FactSet estimates of 506,400 additions. This shortfall reflects ongoing challenges in the U.S. telecom sector, where operators are offering aggressive promotions like trade-in deals and long-term price guarantees to attract customers. In response, T-Mobile introduced new plans and a five-year price guarantee earlier this week to remain competitive.
Despite the quarterly miss in net phone additions, the company beat Wall Street expectations with $20.89 billion during Q1, The company raised its 2025 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance to a range of $33.2 billion to $33.7 billion, slightly above its prior projection and aligning with analysts’ average estimate of $33.4 billion, according to LSEG data.
T-Mobile’s performance contrasts with its strong showing in the previous quarter, where it exceeded expectations for wireless subscriber additions, fueled by demand for its premium plans. The company’s Go5G Next and Go5G Plus plans, which bundle high-speed internet with access to streaming services like Netflix and Apple TV Plus, have been popular among customers. Over 60 percent of new customers have chosen these plans, according to Mike Katz, president of marketing, strategy, and products.
The current quarter’s underperformance underscores the challenges T-Mobile faces in a competitive market. Telecom operators in the U.S. are battling for a shrinking pool of customers, leading to increased promotional activity and pricing pressures. T-Mobile’s strategic response, including the introduction of new plans and a price guarantee, aims to bolster its position in the market.
As the year progresses, T-Mobile’s ability to execute on its subscriber growth targets and maintain its financial performance will be closely watched by investors and industry analysts. The company’s focus on premium plans and competitive pricing strategies will be key factors in navigating the evolving telecom landscape.
Shares of the Bellevue, Washington-based company fell over 5 percent in after-hours trading following its Q1 earnings release.
