T-Mobile may raise ‘older rate’ plan prices in June


T-Mobile issued an upbeat Q1 earnings report where it added 532,000 postpaid phone subscribers, beating the analysts estimate. It also logged its lowest ever Q1 subscriber churn rate along with a slowdown in phone upgrades. 

Both were attributed to the fact that customers love its network and don’t want to leave it, even though AT&T also logged a record low churn but a drop in revenue from phone purchases. 

On the financial side of things, T-Mobile‘s earnings before interest, taxes, depreciation and amortization went up by 8% compared to the same quarter last year to $7.6 billion, again beating the forecast by a tad. 

The Un-carrier’s year-on-year service revenue, however, was down to $19.59 billion, and one analyst is predicting that this could ultimately force T-Mobile to raise plan prices. According to Bryan Kraft from Deutsche Bank, this may happen as soon as June:
Currently, T-Mobile indeed enjoys lower plan prices than Verizon or AT&T, especially for multiple lines and family plans:


The difference in plan prices between Verizon, T-Mobile, and AT&T, however, is not as significant as it was a few years back. At the time, T-Mobile wanted to gain market at all costs to its financial results, while the other two big carriers were laughing on their way to the bank.

Older T-Mobile plan pricing might have to go up

Besides the good quarterly numbers, T-Mobile also unexpectedly raised its revenue and profit forecast for the year somewhat. It now expects net customer additions to be between 5.2M-5.6M for the year, up from the 5M-5.2M range.

What’s more, T-Mobile now expects a $100 million higher adjusted cash flow figure going forward. According to its CEO Mike Sievert, T-Mobile looked at the growth in the last quarter, and decided to “edge up our guidance to make sure we are keeping investors targeted on our most contemporary views of how our year will unfold.”

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What might be the reason for T-Mobile‘s newly founded revenue optimism and raised 2024 guidance numbers? Why, the extra money it would get from raising “some” plan prices, as per that same CEO Mike Sievert during T-Mobile‘s quarterly earnings call with investors:

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Long story short, T-Mobile might be preparing to raise at least some of its plan prices, bringing them more in line with the rising costs of its 5G network deployment. It just remains to be seen by how much, and an announcement may happen as soon as next month.

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