T-Mobile US Inc. (NASDAQ:TMUS) issued updated guidance after closing its acquisition of UScellular, raising its cost-savings target and cutting its integration timeline.
The carrier now expects $1.2 billion in annual cost synergies from the deal, up from its earlier $1 billion forecast. Integration is set to wrap up in two years instead of the previously expected three to four years.
T-Mobile COO Srini Gopalan said the combination would enhance service for both companies’ subscribers. T-Mobile projects $950 million in operating expense reductions and $250 million in capital expense efficiencies. Integration costs are expected to total $2.6 billion, consistent with earlier guidance.
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For the third quarter, the company forecasts $400 million in service revenue and $125 million in Core Adjusted EBITDA tied to UScellular.
It also expects $100 million in integration costs, excluded from EBITDA, and $175 million in depreciation and amortization.
The addition of UScellular and Metronet accounts, which have lower average revenue per account, will reduce postpaid ARPA by about $1.50 in the third quarter. T-Mobile still anticipates at least 3.5% ARPA growth in 2025 over 2024.
T-Mobile is accelerating its billing system overhaul, which will result in $350 million in mostly non-cash charges this quarter. Another $120 million in expenses are expected from recent acquisitions and network projects.
The telecom industry faces pressure from new entrants and unconventional players. Efforts like MrBeast’s mobile phone venture show how influencers and brands are moving into the space, intensifying competition for traditional carriers.
Investors track sector-wide performance through the iShares U.S. Telecommunications ETF (NYSE:IYZ) and Vanguard Communication Services ETF (NYSE:VOX).
Price Action: At last check Thursday, TMUS shares were trading higher by 0.49% to $253.90.
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