UScellular Acquisition Already Exceeding T-Mobile’s Expectations

T-Mobile is getting more bang for its buck from buying UScellular than it originally thought. The wireless giant now expects to save $1.2 billion per year from the deal – that’s $200 million more than initially projected when the acquisition was announced.

As announced by T-Mobile, the company is also moving faster on combining the two networks. What was supposed to take three to four years will now be done in about two years.

T-Mobile completed its purchase of most of UScellular’s operations on August 1st. The deal brought T-Mobile roughly 4 million new customers, mostly in rural areas where UScellular had a strong presence. However, these customers tend to pay less for their monthly service and are more likely to switch carriers compared to T-Mobile’s existing base.

The faster integration means T-Mobile can start rolling out its network improvements to former UScellular customers sooner. This should mean better coverage and faster data speeds for people in areas where UScellular previously operated.

For the current quarter, T-Mobile expects the UScellular acquisition to bring in about $400 million in revenue. The company is also spending $350 million this quarter to upgrade its billing systems and other technology as part of a broader digital transformation.

T-Mobile’s stock has performed well since the acquisition news, as investors see the deal as expanding the company’s reach into underserved markets while eliminating a competitor.

Tags: , ,