T-MOBILE US INC (NASDAQ:TMUS) Q3 2025 Earnings: EPS Miss Overshadows Record Customer Growth and Raised Guidance

T-MOBILE US INC (NASDAQ:TMUS) reported third-quarter 2025 financial results that presented a mixed picture for investors, leading to a negative reaction in pre-market trading. While the company posted record customer growth and raised its full-year guidance, its earnings per share fell short of analyst expectations, overshadowing a revenue beat and strong operational performance.

Earnings Versus Estimates

The third-quarter earnings report revealed a divergence between the company's top-line performance and its bottom-line profitability.

• Revenue: The company reported total revenue of $21.96 billion, which surpassed the analyst consensus estimate of $22.36 billion.
• Earnings Per Share (EPS): T-Mobile reported non-GAAP EPS of $2.59. This failed to meet the market's expectation of $2.44 per share.

This earnings miss appears to be the primary driver behind the stock's pre-market decline of approximately 1.6%, as investors weighed the profitability shortfall against the positive customer metrics.

Financial and Operational Performance

Despite the earnings miss, T-Mobile's operational results for the quarter were robust, demonstrating significant momentum in customer acquisition. The company highlighted "industry-leading customer growth" as a key driver of its performance.

• Customer Growth: T-Mobile added 2.3 million total postpaid net customers, marking its best-ever result for a third quarter. This was bolstered by 1 million postpaid phone net additions and 560,000 total broadband net customer additions.
• Financial Growth: The strong customer growth translated into a 9% year-over-year increase in service revenues, reaching $18.2 billion. The company also reported net income of $2.7 billion and generated adjusted free cash flow of $4.8 billion.
• Network Leadership: The company continues to tout its network advantage, citing recognition from Opensignal as a 5G Global Winner and reporting that its fixed wireless internet speeds are nearly 50% faster than its closest competitor.

Revised Outlook and Market Context

In a confident move, T-Mobile raised its full-year 2025 guidance across several key metrics, suggesting management's belief in the durability of its current growth trajectory.

• The company now expects total postpaid net customer additions between 7.2 million and 7.4 million, a significant increase from its previous forecast of 6.1 million to 6.4 million.
• Core Adjusted EBITDA guidance was raised to a range of $33.7 billion to $33.9 billion.
• Adjusted Free Cash Flow is now projected to be between $17.8 billion and $18.0 billion.

This raised outlook, particularly the surge in expected subscriber growth buoyed by the recent US Cellular acquisition, provides a positive counterbalance to the quarterly earnings disappointment. The guidance indicates that the company's fundamental growth engine remains powerful.

Market Reaction and Conclusion

The market's initial reaction, as seen in the pre-market dip, focuses on the earnings miss. In the short term, investors are penalizing the company for not meeting profitability targets. However, the underlying strength of T-Mobile's business is undeniable. Record subscriber growth, rising service revenues, and a significantly raised full-year forecast paint a picture of a company successfully executing its market share-gain strategy.

The divergence between the strong operational results and the stock's negative price action highlights the market's nuanced interpretation of earnings reports, where bottom-line figures often carry immediate weight. The key question for investors is whether the company's powerful growth trajectory and raised future earnings potential will soon outweigh the single-quarter earnings miss.

For a detailed breakdown of historical earnings and future analyst estimates for T-Mobile US Inc, you can review the data here.

Disclaimer: This article is for informational purposes only and is not intended as investment advice.