T-Mobile Quarterly Earnings: Data Breach Settlement Contributes to Profit LossT-Mobile Quarterly Earnings: Data Breach Settlement Contributes to Profit Loss

T-Mobile touted the expansion of its business internet service and enterprise customer wins in its latest quarterly earnings.

The Washington state-based company unveiled its second-quarter earnings and included several updates about the decommissioning of the Sprint network. Shareholders and analysts cheered T-Mobile for beating its expected growth in wireless subscribers. The self-styled “un-carrier” recorded 380,000 postpaid account net adds in Q2. That’s T-Mobile’s highest yet, and the company purports the number to be the highest in the industry.

T-Mobile’s Peter Osvaldik

However, T-Mobile revenue totaled $19.7 billion in the quarter, a slight decrease from the previous quarter and Q2 2021. The company recorded a loss of $108 million in the quarter. It cited a $477 million non-cash impairment charge for acquired Sprint wireline assets that will not contribute to the T-Mobile wireless business. T-Mobile also cited expenses from a class action settlement related to a data breach.

T-Mobile executives added that most of the Sprint network has shut down, two years after the completion of the T-Mobile/Sprint merger. Almost two-thirds of the 35,000 targeted sites are now decommissioned, chief financial officer Peter Osvaldik said.

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T-Mobile did not disclose financial numbers for its business segment, although Osvaldik said the entire segment saw growth.

T-Mobile’s Callie FIeld

Callie Field, who leads T-Mobile’s business group, pointed to the company’s wins with AutoZone and General Mills. She said T-Mobile has engaged in exciting conversations with CIOs and CTOs.

“They’re looking at their own ways to manage costs, be efficient and effective, and get connectivity that is on not only the largest and fastest, most reliable 5G network, but the only provider that has a 5G standalone port, which CIOs understand that matters to solutions like advanced network services,” Field said during the earnings call Tuesday.

T-Mobile president and chief executive officer Mike Sievert said relationships are deepening with enterprise customers.

T-Mobile’s Mike Sievert

“Remember, a couple of years ago, we were kind of winning some accounts along the lines of, ‘Hey, if I throw you a few of my lines kind of unofficially, will you help me reprice my AT&T business, and you’ll get some of my [sic.]’ That’s never really spoken, but you can see the RFPs were sort of designed for that. And what happens now is some years later, customers are coming back and saying, ‘Actually, I’d like you to bid for the whole kit ‘n’ caboodle now,'” Sievert said.

Field noted that T-Mobile made its business internet available nationwide last quarter. She said the milestone makes T-Mobile the only player in the market to perform such a feat.

Inflation

A large swath of publicly traded technology companies have blamed macroeconomic factors for lower-than-expected earnings. For example, Microsoft cited the production shutdown in China, and mobility rival AT&T blamed rising inflation and wholesale costs.

T-Mobile executives also touched on the topic of inflation. They vowed to not raise the price of rate plans for customers in an earnings call.

“We’re here to help broadband customers across the country as well with our recent launch of internet freedom,” Sievert told analysts. “Broadband customers are some of the least satisfied in America, the fees, the contracts, the price hikes, the terrible customer service — it’s all ridiculous.”

Cyberattack

Executives also touched on the $350 million settlement they recently paid to customers for a 2021 data breach.

“We always knew that there would, unfortunately, be financial consequences from this attack, and we were pleased to recently reach settlements that will resolve the class actions and most of the consumer claims,” Sievert said. “Together, we believe these settlements will represent the biggest component of those impacts.”