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T-Mobile Earnings Preview: What Do Analysts Expect?

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The Q3 earnings cycle is in full swing, with various companies reporting daily. Many companies have posted better-than-expected results so far, helping to kick the period off positively and lifting sentiment.

And soon, we’ll hear from communications titan T-Mobile US (TMUS - Free Report) . But how does the company stack up heading into the release? We can use results from a few peers, AT&T (T - Free Report) and Verizon (VZ - Free Report) , as a light guide. Let’s take a closer look.

AT&T

AT&T posted earnings of $0.64 per share, narrowly exceeding the Zacks Consensus EPS Estimate and modestly lower than the year-ago figure. Quarterly revenue totaled $29.9 billion, improving 1% year-over-year and driven by solid 5G and fiber subscriber growth.

Free cash flow also positively surprised, totaling $5.2 billion and growing 33% from $3.9 billion. Given the favorable quarter, AT&T boosted its full-year free cash flow guidance to roughly $16.5 billion, above prior views of $16 billion. Adjusted EBITDA guidance was also improved, with full-year growth of 4% now expected vs. 3% previously.

Investors were pleased with the results, with T shares popping post-earnings.

Verizon

Verizon posted a bottom line beat but modestly fell short of revenue expectations, with both items lower than the same period last year. Impressively, YTD free cash flow totaled $14.6 billion, well above the $12.4 billion last year.

Like AT&T, Verizon raised its FY23 free cash flow guidance following the results, expected at $18 billion vs. prior views of $17 billion. Verizon shares also got a nice boost following the release, reflecting that market participants were pleased with the results despite a top line miss.

T-Mobile

Analysts have been bearish for T-Mobile's release, with the $1.75 Zacks Consensus EPS Estimate down nearly 12% since August of this year. Top line expectations have also moved lower, with the $19.4 billion quarterly revenue estimate 1.1% lower during the same time period.

Zacks Investment Research
Image Source: Zacks Investment Research

It’ll be interesting to hear commentary from the company, particularly after Verizon’s and AT&T’s recent guidance lifts. As we can see below, the company’s revenue has primarily remained stagnant over the last few years after a massive boost in 2020.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

Earnings season is in full swing, with an extensive list of companies gearing up to deliver quarterly prints.

Soon, we’ll hear from T-Mobile US (TMUS - Free Report) . Analysts have been bearish regarding their earnings and revenue expectations, with both estimates down since August.

Two peers, AT&T (T - Free Report) and Verizon Communications (VZ - Free Report) , already reported their quarterly results, with each lifting free cash flow guidance and seeing positive reactions for shares post-earnings.


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