T-Mobile US, Inc. (TMUS) Earnings Call Transcript & Summary

All right. If everyone could please find a seat, we're going to get started here with our next session. Always a lot of fun to welcome to our Communacopia plus Technology Conference. Mike Sievert, the President and CEO of T-Mobile, Mike, thank you so much for being here.

Thanks Brett. Looks like you've snag the place up since we were here last. That's good.

Yes. Yes. You're supposed to remind people disclosures. Jud wanted me to point that out.

Jud is doing this thing. So I think we're going to put a slide up. We might say forward-looking statements. Actual results might be different. Please look at our disclosures to understand the risks.

All right. Well, let's jump into it. So you expect to execute on a number of your key merger goals by the end of this year, and a long time coming. So you're going to have, I think, 300 million-plus POPs covered with your mid-band spectrum. You're on pace to achieve $7.5 billion of merger synergies so naturally, everyone is looking ahead. And the questions we're getting is what do you see as the key drivers of EBITDA and cash flow growth for T-Mobile as you look into 2024 and beyond. And how is that shaping the way your strategic and operational priorities are evolving?

Well, it's just -- it's an interesting question because it's being asked at a historic moment in time in our company's history. You think about we've just finished 6 full years of dreaming about, planning for, fighting for this merger and then 3.5 years integrating it to, I think, create the most successful merger in telecom history. And so it does beg the question, what's next. And what's next is taking advantages of the strengths we've built in network and the ability to deliver a superior value to continue to profitably outpace this market on growth and translate that into superior cash flow returns for our shareholders. And that's what we've been demonstrating quarter after quarter. Q2 is a great example of this, and we expect that same playbook to be what informs us through 2024 and beyond. We're in the middle of a multiyear strategy for this company post-merger that is working and the business is performing very, very well. That stability in fact, is it okay if I break some news at your conference. So that stability and quarter-after-quarter performance and demonstration of our ability to translate this strategy into cash flows has caused us as a Board to go ahead and authorize the next tranche of shareholder remuneration. And so we are going to be authorizing a $19 billion program over the next 5 quarters through the end of 2024, in addition to the $14 billion that we expect to complete this quarter. And it's really an exciting moment for us. And by the way, part of that this is also news for the first time in our history, we will authorize a $3 billion annual dividend as part of that $19 billion. So across the 5 quarters, that's $3.75 billion in quarterly dividend payments. And we expect the dividends to grow after this year at about 10% per year. And so we're starting down that path -- now in a business that is expected to deliver $16 billion to $18 billion in cash flows according to our Analyst Day guidance for next year, that's a modest start, but I think it's really important to begin to move down that path without constraining us in any way in terms of our ability to allocate capital to business objectives. So that's exciting. We're also going to move a little faster than expected next year towards our long-term leverage target in the mid-2s, as we've been talking about for a long time. And I think we'll be at about 2.5% next year. Given the broad macroeconomic inflation and cost of capital environment, we think that's a really smart place to be for our company. And in addition, we're covering in this outlook the obligations that we see things like $4 -- $4.5 billion for things like the Columbia Spectrum acquisition, things like the final payments for C-band clearing, a kitty for other opportunistic things that we see for the business and then still having an initial authorization of $19 billion between now and the end of 2024. So it's a really exciting moment that I think it's a demonstration of this business's ability to translate market-leading revenue growth into market-leading cash flow growth.

Okay. I just want to make sure we get all those great details right. So $19 billion capital returns program that will kick off essentially in the fourth quarter of this year because you'll be wrapping up the current one at the end of this quarter or carry through 2024, $19 billion, of which $3 billion on an annualized basis is going to be a dividend. So I guess a little bit more than $3 billion throughout that...

$3.75 billion there across the 5 quarters, give or take. The rest share repurchases, correct.

Do we know what Deutsche Telekom's intent is in terms of participating in the share repurchase program because they sat out the first tranche?

Right. And they announced in their most recent quarterly announcement that they expect to continue to target in the low 50s for their percent of ownership, which implies participation at a certain rate in 2024 and not before then, they made clear. So they like this ownership level, and they're going to continue to target the low 50s, and they will not be executing any sales in 2023.

Got it. So roughly speaking, about half of that buyback beginning in 2024 would be in the open market?

It could be. They've said that they have a target range, but it's not one for one. The mechanism for their participation will not be to buy shares from us. It will be through a program to offer their shares to the public market.

And then have you contemplated the potential authorization or issuance of shares to SoftBank and all of this and whether you might look to use your buyback capacity to address those shares if they do come to market.

Well, we've always expected that, that true-up share will get granted. It gets triggered with a 45-day VWAP at $150. If you look at the massive cash production of this business and you value us on cash versus our peers, that seems like an obvious thing that we would blow past. So we've always assumed that was the case. It's not up to us, but that's our business planning assumption, which means at some point, there would be a dilution event between now and when that expires in 2025. But it's, of course, overwhelmed by our purchases in the market. In fact, we purchased more in the last 60 days over the last, say, few months, then that whole potential dilution event in the first place. So there's always a chance for a transaction that would accelerate it or satisfied in a different way or get it done sooner, but that would have to be something that all the parties would see as a win-win. And so far, we haven't executed such a thing.

My last question on this. You had previously and reiterated for a long time the potential to return up to $60 billion to your shareholders through the end of 2025. If you complete the current program and the $19 billion that will put you about $33 billion through the end of 2024. That's a lot of theoretical capital returns that could happen in a 12-month period. Do you still feel confident that, that $60 billion is the right framework for investors?

I think it's a lot more than that over the long haul. I want to make that clear. It was just an initial aspiration for the first 3-ish years. If you look at our current views on leverage of getting to that mid-2s a little sooner, it might imply it would take us 60, 90, 120 days longer than originally planned. So it could trickle into the first part of '26. But on the other hand, the '26 could be a much more substantial program that goes well beyond the 60 as well. So it's going to depend on how we feel about leverage next year. It's going to depend on exogenous things that could be cash infusions. So it's a possibility to get it done right on time. But I would say that excepting for something that's unforeseen, it may trickle into the very first part of '26.

Let's move on. So in late August, you disclosed plans to reduce T-Mobile's head count by about 5,000 employees. I think it's about 7% of your total workforce. You had disclosed a letter to employees talking about some of the costs associated with acquiring and retaining customers and how that had been going up. I was hoping you could just elaborate a little more on sort of what went into the decision here to make this adjustment.

Of course. Well, first of all, I wanted to write that letter to employees so that they understood the thinking behind it. And this is not a decision that we took lightly. It's not something that we do at T-Mobile every year. This is a culture that's really, really important to me and to us. But it was a long letter and said a lot more than that. What it talked about was our ability to reclaim our efficiency, our entrepreneurship, our speed, our decisiveness, the cultural characteristics that got us to this present success in the first place. And after 3.5 years of integrating a merger and hyper growth and a historic network build that's never been seen before in this country, we found ourselves with a lot of duplication and that gets in the way of decisiveness and speed and efficiency. And efficiency to that point in the letter is important because it costs more to compete now than it did say at the height of the pandemic a couple of years ago. And we've made that very clear in all of our quarterly releases. But what we do as a management team is we get after it. When the customer started voting with their dollars, 2 years ago-ish that they wanted device subsidies. It's always been a slider in this business between they want great rate plans, they want device subsidies, they want some of both. Right now and over the last couple of years, it's been device subsidies. That's been where competition has gone and it's stable. That's not really changing right now. But I made it clear to our employees that, that was an input factor that in that world, we have to be at our best. And my job as a management team -- as the leader of our management team is to always look around corners and to make sure that I'm positioning our company to be successful, not just this year, but for several years to come. And having that efficiency and that ability to compete and that speed and decisiveness and entrepreneurship was something that we felt was very, very important to reclaim culturally. But I do want to make it clear, we're really comfortable in this competitive environment, and it is not rapidly changing. It's been stable for several quarters. It did slide more towards devices that is more expensive. But as you saw in our Q2 results, we're navigating through that beautifully.

Well, you make a good point. I mean the market has been, I think, a lot more durable than investors have feared. And I'll make that point and the first thing I'll hear back is to say, yes, but look at what cable companies are doing first-line free. You have some experience with that through a predecessor company that you acquired. DISH is now offering a $25 unlimited plan available through Amazon. And so the question we keep getting is, is this just temporary? Are we going to see the underlying fundamentals of this industry deteriorate? What's your outlook for the wireless sector?

I'm so bullish on it -- look, I've been getting that question at every earnings call now for 45 calls. This has been an evergreen question about our sector, that whatabouts, whatabouts; isn't it all going to fall apart. The bottom line is, yes, it's more competitive now. That's maybe in part due to our merger. We weren't kidding when we said we would bring more competition, but our company is insulated in a way to be able to navigate that competition. We have the best network in this space, and we have the assets to make that continue to be true and the ability to execute to continue to make that true. We have the best values in this space and the balance sheet to be able to defend that value leadership position, and we deliver the best customer experiences, and we have the culture to be able to continue to dispense that for our customers. And so we're navigating it beautifully. And cash flows across this industry are way higher than 5 years ago or 10 years ago. This industry that people side eye and keep saying, "Yes, but sure, it's good now, but isn't at all about to fall apart. "I don't think so. And I look at the stability of it, the fundamental trends and more importantly our ability to execute and navigate a competitive environment where there is a lot of head-to-head competition, that's where we shine. And you saw it in Q2 in this environment with the highest-performing postpaid phone net adds in our history, [indiscernible] to [ 18 ] years ago and the lowest churn in our history and double-digit EBITDA production during a year when we're delivering 75% year-over-year cash flow growth and we're going to translate that cash into 20-plus percent cash flow margins on service revenues. That is a healthy, stable growing business, and that's why we're engaging in such a significant shareholder remuneration program.

And has that momentum continued into the second half? Because the first half of the year, you generated essentially the same number of subscriber additions that you did in the first half of last year, even though the industry dipped a bit. The year-on-year comp gets a little harder for you guys in the back half. How are you feeling about the performance of the company relative to the guidance you've given?

Well, I see you brought your pen since I've already broken notes -- news. I'll just give you a week by week actuals for the Q3 so far hope that works out. Now listen, it's a stable environment where we're performing really well. We're confident. Look at that churn number. I mean, I told the market 3 years ago when we brought these companies together and combined T-Mobile, which was the lowest churning brand with Sprint, which was the highest churning brand. And I said with best network and best value, we'll get to the lowest churn and we did, that's not done. I mean we've kind of matched everybody now, and we've notched our first quarter as the leader in churn. There will be a little more back and forth before we put them in the rearview mirror for good. But when you have the best network and the best value and a culture that delivers the best customer experiences, the natural place for churn to be is leadership. I want people to join T-Mobile and stay with T-Mobile for life. And so any churn is a regretted loss for T-Mobile. And that's our competitive environment. That's how we're navigating and what I want people to understand is that we lay out these multiyear aspirations, we have detailed business plans behind them, and then we put our heads down and we go execute. And that's why we consistently deliver the results that we promised to our investors.

When you're looking at churn right now, what is the driver of it?

It's best network, best value. That's what people want. And it's so simple. And by the way, wireless is a deeply considered purchase. People think it through. They compare, they ask their friends, they look at where coverage is. They think about where they go, who's got the best overall experience. It's really an important category to people. That's why it's so sticky when budgets get tight. But it's also something that I think is important to understand as a pure-play wireless company how important this category is because obviously, some believe that they'll just slap on any wireless offer along with their broadband, that's just not the case.

I'd like to talk about some of the recent offers you put in the market. So you had a series of offers that you rolled out earlier this year collectively sort of Phone Freedom is the banner you've put on that. So that would include your Go5G Plus and more recently, your Go5G Next rate plans. And what you're allowing people to do is to upgrade their phones every 1 to 2 years as opposed to every 3 years, which is what your competitors have typically done. It must be going okay because you're now putting the next iteration of the product into the market. So the first part of the question is, how are investors going to see the benefits of the traction with these various Phone Freedom offers. Is it about net adds? Is it about churn? Is it about ARPU? And then the second part of the question is how do you do this without shifting the perception of the T-Mobile brand to being a brand that's about device value as opposed to being about network value because you've invested so much in your network.

Yes. That's a great question. First of all, what it's about is ongoing profitable market-leading growth that translates into market-leading cash flow growth. But we believe that a key formula for that is winning customers and then retaining them. I'm not kidding about leading this market on churn. That's the holy grail in a business like ours is keeping that churn as low as it can possibly be. And there's room to run even though we beat everybody in Q2. And so having the offers that people want and being guided by the customer is so important and right now, what customers want is a great deal on devices. Devices have gotten a lot more expensive. I don't know if you've noticed and so they're counting on us to help with that and to provide discounts and offers and upgrades. They want the new ones, they can't afford it. That's why device upgrade rates have lengthened, is because they don't want to dispense the cash. They'd rather pay for it over time in the form of an arrangement with the provider. But when it's time for the new one, they don't want to be told no. That was a core insight that we discovered almost a decade ago with our groundbreaking JUMP Un-carrier move where we allowed people to upgrade when they want. When you've decided it's time for you, then it's time for you to go and not be told by some nameless, faceless company that, well, you're not done paying yet. And so that's why we've provided these offers. And they are accretive to ARPU. I think that's a great side benefit. I think will provide stickiness. That's an important benefit. And we've done this with a set of goals for '24 and '25 in mind that cause us to continue to drive service revenue growth and translate that into EBITDA and cash flow growth through share taking, ARPU and retention. So in a way, it's a little of each. This has been a fantastically successful Un-carrier move so far.

Are you evolving the way you're thinking about pricing, you're not explicitly raising price to way that some of your competitors have. But you keep putting new plans in the market that offer more and cost more and if I just look at Go5G Next, depending on how many lines you take, it's not even necessarily cheaper than what your competitors are offering. So now that you've completed the network integration, you're 2 years ahead of everybody on 5G, are you thinking that there's a way that maybe you can capture a bit more of that value in your price points?

Well, you asked about our brand before. And this is such an important question as it relates to our brand. What we do is offer incredible market-leading value and choice and customers. If you have a high price offer that offers incredible value and more than anybody else's offering doesn't make you a high-price provider. It just means you've got an option. Similarly, if AT&T and Verizon come out with like one offer and stick it in the corner of their website, it doesn't make them a value player. Customers are smarter than that. They look across the portfolio of offers, and they ask themselves, what am I getting for what am I paying? And one of the reasons why we keep posting the most net growth of anyone while delivering financial performance is because customers are concluding T-Mobile has the best value, reliably and consistently over time. And that's so essential for our brand. Now as it relates to Go5G Next, it's a higher-priced offer that offers an unprecedented benefit, which is the ability for a no questions asked upgrade every year at the same price that we offer to new customers. And other people aren't offering you that. They put you in a 3-year EIP and then we'll see. There might be offers where you can upgrade sooner. There might be a feature you can buy where you get a known discount of a few hundred dollars off a phone at a certain point. But this is a groundbreaking value, and therefore, some people are willing to pay for it because of how important it is.

All right. I want to shift to a new topic here. We've been asking and will be asking many of your peers about their views on convergence. We've been talking about convergence for over 20 years. And the version of it right now has kind of come to the surface because you've started to introduce more product bundles, the cable companies have started to offer more product bundles. And so the question really is as you think about convergence, how do you define it? Is it a product strategy? Or is it a network strategy? Because I get by and asked by investors, can a company that exclusively operates wireless infrastructure, thrive in a world where people are increasingly looking to buy more than one product.

Well, I think the bundling part of convergence is quite simply discounts by another name. So far, there haven't been demonstrated to be any interesting and significant benefits beyond discounts. Everybody offloads a ton of their volume on to a home WiFi that home WiFi doesn't have to come from the same provider. With today's digital payments, having one paper printed bill that you stroke one handwritten check. That benefit is long since in the rearview mirror. And so what are the benefits? The benefits are discounts. That being able to offer a great value and resonate with customers about that value through our brand, that's one of our competencies. And it's a competency that is defendable by our superior balance sheet and our superior assets. . And so look, we'll have to see where it goes. I've been very clear as it relates to our fixed 5G service that it plays a role in the marketplace. We'll fill some single-digit penetration role. It's a very mainstream offer, but we don't think it's going to take over cable and fiber. It kind of looks like it right now because our net add performance is better than everybody. But I've always been clear that we see some single-digit millions of penetration, single-digit percentage of penetration. We're on our way there. We're well ahead of schedule as usual, what you would expect from our management team. So we're not going to change the broadband world with that offer in terms of swapping out half the customers in this country. And nor are they going to change wireless that significantly. We're coexisting with cable and wireless more than we're competing. I think that's partly because they're kind of changing the definition of what's a postpaid customer. They're sort of expanding the tent quite a bit. Most of those customers are not people you found in the postpaid space. That's why we're able to -- while watching their growth deliver the best postpaid phone performance in our history for Q2. And so we're comfortable. It's working for us, and we're executing our game plan, and it's translating to shareholder value very nicely.

Why do you think the fixed wireless service has resonated so well with consumers? Because by all measures, you're outperforming any estimate that any analysts, including me would have had 18 or 24 months ago.

Well, that's just because people didn't believe us. I mean what's happening is exactly what we told people would happen at our Analyst Day. And it's happened a little faster because we like to do a little bit better. But look, people don't like cable companies. And luckily, that's not just like some small niche. There's a lot of people that don't like cable companies and cable companies are the incumbents in this country. And that's something that we're feeding on, but also they love the elegance and simplicity of this product. I mean, it kind of blows their mind. They're saying, "You're telling me that I just take this one thing and all I need is some AC power. I just plug in as one cord. And I plug it into AC power and I've got home broadband. " Yes, that's how it works. And right now, people don't want to be IT managers of their own digital life. They want mental freedom from all that. And our product is elegant and simple. You set it up simply through an app experience. It helps you decide the best place to put it in your house, you are done. And hopefully, you never think about it again. And people love that. You remember those rats nest of routers and modems and cables and ethernet cables and you've got to pay a guy to come do it for you. You got to roll a truck, I don't know what all that stuff is. And how do I set it? That's the world they're coming from. And so it's very -- we're 30 points Net Promoter Score higher than cable. We're the highest non-fiber Net Promoter score brand, and we're higher than average fiber nationwide. And by the way, our performance of our product is mainstream. The download speeds according to Ookla on 5G at T-Mobile are 220 for Charter and Comcast, they're like 230s or 240s. I mean we're the same speeds as median cable for those that think this is like a niche that's for certain roles. Is it for the gamer who wants terabytes and terabytes a month? I mean, we can support those. We have some of those, but it's probably more for like regular families.

As you've said, you're doing this because you do have fallow capacity in parts of your network because your network is so capacity rich at this point in time, which is why you talked about getting to the single-digit penetration of the market over time. But if there's clearly interest in more people being able to buy this type of a product bundle, how do you think about other ways you can meet that demand because you are obviously able to offer high-quality mobile services everywhere.

Well, what we want to do is offer in everything we do. We want it to be a business plan that has fantastic returns for our shareholders. And we're very careful about dispensing lots of capital into things that aren't going to have great returns. And so we're looking at it. And we're looking at multiple paths. One, are there capital dedicated ways to grow our 5G broadband business beyond the current fallow capacity model that we're executing against. And that might mean millimeter wave dedicated spectrum. It might mean mid-band dedicated spectrum. It might be multi-dwelling units. We're looking at loop self-backhaul systems, where sites can see each other and other strategies and we haven't drawn any conclusions yet. We haven't cracked the code yet as to how we can do a wireless dedicated capital program and then return money on that capital in a reliable way, but we're not done looking. It's just right now, it's not presenting itself as obvious. So we're heads down looking at that. And then the other piece that we're looking at, and I've been pretty transparent on this, is whether or not there's a way to smartly invest capital using our brand resources, network, distribution, people and fiber. And we're already experimenting. We've got partnerships in the area to see how our brand resonates, how well we do at serving customers. We're executing now in multiple cities, small partnerships and we're thinking about whether or not there's a capital light way to enter that business and take advantage of our embedded customer base and our fantastic brand. And we're not going to do it until we can do what we always do, which is present you with a business plan, tell you we've thought it through and promise you a bunch of results from it. And that's what we've built a reputation around making promises and then beating them. And if we can find a way to do something really accretive and exciting in one of those 2 areas, we will do it.

So fixed wireless is one of the growth opportunities you had outlined at your Analyst Meeting a little ways back. The enterprise opportunity, the rural community opportunity, those are both areas where your market share going into this was essentially single digit, maybe low double-digit percent. You have about a 30% share nationwide across the entire business. How are you tracking against your goals in both of those segments?

On or ahead of schedule. Rural markets, smaller markets in rural areas make up about 40% of the country. When we started down this journey, we were at a 13 share. As of Q1, we were at 16.5%, sort of halfway to our goal of 20% inside the 2025 planning horizon, just unfolding beautifully. Our share of port ends in the 70% of smaller markets and rural areas where we fully compete is in the high 30s and blended across all smaller markets in rural areas. It's in the low 30s. Number two, already to Verizon in share of port ends across everywhere, including blending in places, we don't even compete yet. And so that's just a great place to be. There's pent-up demand for our brand. People have been seeing our national brand for a long time saying that sounds about right. And then we just kind of weren't there yet. And so now we're there, not only there, but with the leading network, the only people with any credible rural 5G strategy, and it's really exciting. And home broadband is a front door that attracts some of them to our brand in the first place because we're offering competition there that's delighting them. So that's going beautifully. Enterprise, same story. We were a very low single digits, like a 10-ish share. It's growing like crazy, Q2 was our highest net add, our lowest churn quarter ever in our history in business. We're outperforming our benchmark competitor in this space that we've always held up as the gold standard. So now we've got an engine that's really working. And it's working because we're putting together solutions that customers really want with 5G at the center. And we're demonstrating those things to customers that make a considered decision. They check out 100 phones. They study who has the best network, but they also look at how we connect that network to solutions for their businesses. And that's just starting to fire on all cylinders. We have a lot of room to run there. And they're not buying us just on price. We offer great prices like we do to consumer. But we're winning there because our product and our solutions and our network are what they need.

How do you feel about your reach into a large enterprise right now? Because obviously, AT&T and Verizon have tremendous reach. They don't just sell mobile solutions. They sell a variety of connectivity solutions. Are you finding that not having the non-wire solutions is a barrier to getting into these RFPs?

No. It was a year ago. We were kind of working our way past the procurement office and to the corner office and the CIO a year ago. But we've made tremendous strides on that. And so now we have the ability to get the meetings we need and to be in the mix. Everybody knows we're the 5G leader. And so they're going to call on us. Even if at first, they think we're just there to price cut their Verizon deal, do you know what I mean? That's how they kind of -- some of them -- look, we'll show up if that's what they want us to do. But somewhere in that sale process, lightbulbs go up, and they're like, "You know what, maybe instead of throwing these guys 5% to keep Verizon honest, maybe we should flip the whole thing, listen to what they're saying about how this service can really change how we run our business. And those are such exciting moments for our team. They just energize everybody. I'll tell you, our business team is just firing on all cylinders.

Coming back to rural opportunity for a moment, would you consider maybe accelerating that strategy if an asset came up for sale?

Say the question again?

Would you consider accelerating your rural strategy if an asset came up for sale in the rural community?

Like what asset?

You can pick one for example.

Listen -- maybe. But I like our plan A, a lot. I mean if you just look at what we said we'd do, we'd get to a 20 share from almost nowhere in our first 4 years of trying. And then as you can see in our [ SOPI ] we're performing in the upper 30s where we're fully competing. It suggests that our organic strategy is really attractive. So the hurdle would be high.

I want to talk a bit about prepaid. Historically, you've been a major player in the prepaid market. Verizon has scaled up significantly in recent years by acquiring TracFone, which they're looking to turn around. How do you think about the outlook for the prepaid market right now? Where does prepaid fit into your retail strategy?

Well, it's always been one of our secret weapons. The Metro brand is, by far, the best asset in the space, high-quality customers, low churn, good ARPU, contributes a lot to us financially. I think we'll reclaim the overall #1 spot here. We might already have it. We don't report Lifeline, our Assurance Lifeline brand. We kind of think of it more like wholesale in terms of how we report. We don't include those numbers. The competitor you mentioned includes them, so we may already be the leader again. But if you just kind of look at the trend lines either way, that kind of happens in the next quarter or 2, I suspect. But that's not really the point. The point is that we've got a strong, stable, powerful business because we have a brand in the space people love and trust. And Metro has been a great deal, a no nonsense answer to people that don't want all the complexities of wireless. They want a simple, low-cost solution on the best network, and they have discovered that's Metro.

Last question. You've consistently made a point that you're 2 years ahead of your competitors in deploying your 5G network and you expect that you're going to sustain a 2-year lead on them for a while. They have been working hard just to try to catch up. They've been able to acquire and now clear a significant amount of mid-band spectrum, how do you think about the incremental steps T-Mobile needs to take so that this first mover advantage you've had in 5G brand identity can be sustained?

All we're going to do is execute on our plan. We will end this year covering 300 million people with mid-band spectrum. And when I say mid-band spectrum, I'm saying we're dedicating at least 200 megahertz national average of mid-band spectrum in 5G to those customers across 300 million population. No one is even close to that. Although in some of the numbers, it can sound close, but let me explain. To get from 200 million people to 300 million people is triple the towers. I mean as you get more and more rural from the population areas, it takes a lot more technology to cover fewer and fewer people. We've got all that work in our rearview mirror, and it's taken us years. And so -- and by the way, to get from 100 to 200 is also triple the towers. And so they're starting out that process, but it just takes years. Let me put it in land mass. We have more land mass covered by 5G than AT&T and Verizon combined. In mid-band, we have 4x what AT&T in terms of square miles, almost twice what Verizon has in terms of square miles covered with mid-band 5G, so the numbers of like POPs kind of don't tell the story because all those other tens and tens and tens of millions of people are really hard to cover. And we've already done it. It's in the rearview mirror for us. We have not begun to deploy any C-band. We were big participants there, 3.45 military spectrum. We anxiously await our 2.5 gigahertz from Auction 108 that the government hasn't granted to us yet. And we urge the government to do so. All of that is additional opportunity in terms of spectrum assets we already own that match our grid and can be easily deployed with reasonable capital inside our capital envelope. So we're just so well positioned to be able to continue to deliver customers what they're looking for and when do you think you might start deploying that? Don't know. Right now, I'm much more interested in getting my hands on the Auction 108 because we already hung those radios. And so like the government's inability to deliver us this is keeping millions of people from having competitive home broadband, and it is keeping millions of people from having better 5G service in their communities, not just from T-Mobile, but generally. And when we get those licenses, we can turn all that spectrum on affecting 50 million people within 2 days.

Mike, we're out of time. Thank you so much for being here.

Brett, good to see you.

You too. That's great. Appreciate it.