T-Mobile shares rise as subscriber gains drive earnings beat

T-Mobile US Inc (NASDAQ:TMUS, XETRA:TM5) shares opened on Wednesday about 5% higher after the company delivered a first quarter earnings beat, with stronger-than-expected subscriber growth and profitability metrics.

The wireless carrier reported adjusted earnings per share of $2.27 for Q1 2026, ahead of Wall Street expectations of roughly $2.06.

Revenue came in at $23.11 billion, also topping consensus estimates of about $22.97 billion.

The company’s performance was driven by continued strength in its postpaid business. Postpaid net account additions reached 217,000 in the quarter, exceeding expectations of 193,000 and rising 6% year over year. Postpaid average revenue per account increased 3.9% to $151.93, reflecting ongoing pricing and customer mix improvements.

Service revenue totaled $18.8 billion, up 11% from a year earlier, while postpaid service revenue rose 15% to $15.6 billion.

Core adjusted EBITDA increased 12% year over year to $9.2 billion. Operating cash flow rose 5% to $7.2 billion, and adjusted free cash flow also increased 5% to $4.6 billion.

Net income for the quarter was $2.5 billion, down 15% year over year, while diluted EPS declined 12% to $2.27. The company attributed the decline primarily to merger-related costs tied to its UScellular transaction, including accelerated depreciation charges totaling $476 million after tax.

“Q1 marked a strong start to the year as we continue to execute against our ambitious 2026 and 2027 targets, representing yet another proof point of our winning formula and unique differentiation,” T-Mobile CEO Srini Gopalan said.

“We reported accelerating postpaid net account growth and strong postpaid ARPA growth, reflecting this team’s differentiated ability to not only attract new customer relationships but also deepen the engagement with our existing base.”