T-Mobile Reports 27% Rise in Q3 Net Income to $3.46 Billion and Raises 2026 Outlook

T-Mobile US (NASDAQ:TMUS) reported a 27.3% increase in third-quarter 2026 net income to $3.46 billion, supported by higher wireless service revenue and average customer spending. Shares of the US telecommunications operator advanced in premarket trading on Thursday following Wednesday’s earnings announcement.

Adjusted earnings per share reached $3.22, exceeding analysts’ consensus estimate of $2.89. Revenue increased 7.4% year over year to $23.58 billion, compared with expectations of $23.15 billion.

Wireless Service Revenue and Operating Profit Increase

T-Mobile reported service revenue of $19.38 billion, up 6.2% from the previous year, while postpaid service revenue increased 9.3% to $16.27 billion.

Core adjusted EBITDA rose 10.8% to $9.62 billion, while adjusted free cash flow increased 5.3% to $5.07 billion.

Net cash provided by operating activities declined 2.1% to $7.34 billion.

The company also reported a 4% increase in postpaid average revenue per account (ARPA) to $155.73, reflecting higher average customer spending.

Postpaid Accounts Reach Approximately 35 Million

T-Mobile’s total postpaid accounts increased 3% year over year to approximately 35 million.

The company added 274,000 postpaid accounts during the quarter, compared with 396,000 in the corresponding period of 2025.

Its postpaid account churn rate increased to 1.09% from 0.97% a year earlier.

Raymond James analysts commented:

“T-Mobile put up another solid quarter of results, surpassing our postpaid account adds and postpaid ARPA expectations and taking up the guide at the midpoint for most key metrics.”

They added:

“We believe T-Mobile’s future growth will come through a more long-term approach to disciplined network investments and customer experience than through the knockout sub adds performances of years past.”

Full-Year Profitability and Cash Flow Guidance Raised

T-Mobile increased its 2026 core adjusted EBITDA forecast to between $37.35 billion and $37.45 billion, raising the midpoint of its previous guidance by $100 million.

The company also lifted its adjusted free cash flow outlook to $18.7 billion–$18.8 billion, including net payments associated with UScellular merger-related costs. The midpoint represents a $150 million increase from its previous forecast.

T-Mobile reduced its expected effective tax rate to 24%–25%, compared with its earlier estimate of 25%–26%.

The company maintained its forecast for approximately 1 million net postpaid account additions during 2026 and capital expenditure of around $10 billion.

Deutsche Telekom Reportedly Delays Potential Acquisition Bid

Separately, Bloomberg reported Thursday that Deutsche Telekom had postponed plans to make a formal offer for the remaining shares of T-Mobile US.

According to the report, resistance from Deutsche Telekom’s works council and concerns about potentially reducing the German government’s influence over a combined company contributed to the decision.

Bloomberg said the proposed transaction was on hold rather than abandoned, leaving open the possibility of a future bid.

Deutsche Telekom has reportedly been evaluating a full combination with its US subsidiary since at least April 2026.

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