T-Mobile's Quarterly Subscriber Growth Estimates Trimmed by RBC Amid Elevated Competition

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T-Mobile's Quarterly Subscriber Growth Estimates Trimmed by RBC Amid Elevated Competition

, MT Newswires - 10:22 AM ET 3/21/2025 default

10:22 AM EDT, 03/21/2025 (MT Newswires) -- T-Mobile US ( TMUS ) is expected to add fewer postpaid phone subscribers in its fiscal first quarter than previously estimated by RBC Capital Markets, amid increased competition within the telecommunications industry.

The brokerage projects the wireless company to record 496,000 net additions in its ongoing quarter, down from its prior forecast of 516,000, it said in a Friday client note. The current consensus on FactSet is for 510,400. In the previous three-month period, T-Mobile posted a 903,000 net increase in postpaid phone subscribers.

"We expect (first quarter of 2025) to reflect an elevated level of competition in the industry, with higher churn, higher subsidies and lower net additions," RBC analysts led by Jonathan Atkin wrote in the note. T-Mobile is scheduled to report its latest quarterly results in April.

The company is anticipated to log first-quarter wireless service revenue growth of 5.1% on an annual basis, driven by postpaid subscriber gains, but weighed down by a 35% drop in wholesale revenue, according to RBC. The brokerage, which also lowered estimates of prepaid net additions, expects the segment to be the first to feel the impacts of an industry slowdown.

On Thursday, T-Mobile agreed in principle to divest its 800 megahertz spectrum portfolio to Grain Management for a combination of cash and the private investment firm's 600 MHz spectrum licenses. The deal, which requires approval from regulators, is expected to be finalized by the end of April. Earlier in March, the company completed its acquisition of Vistar Media and Blis to expand its advertising business.

"Our aggregate 2025 estimates are roughly unchanged, as we expect an upside from the newly acquired ads business to be partially offset by wireless competitive factors," according to RBC's Atkin.

The brokerage increased its price target on the sector perform-rated T-Mobile US ( TMUS ) to $260 from $245.

Price: 256.56, Change: -0.47, Percent Change: -0.18

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