Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 28, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 1-33409 | |
Entity Registrant Name | T-MOBILE US, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-0836269 | |
Entity Address, Address Line One | 12920 SE 38th Street | |
Entity Address, City or Town | Bellevue | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98006-1350 | |
City Area Code | (425) | |
Local Phone Number | 378-4000 | |
Title of 12(b) Security | Common Stock, par value $0.00001 per share | |
Trading Symbol | TMUS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,246,857,781 | |
Entity Central Index Key | 0001283699 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 6,677 | $ 10,385 |
Accounts receivable, net of allowance for credit losses of $143 and $194 | 3,592 | 4,254 |
Equipment installment plan receivables, net of allowance for credit losses and imputed discount of $512 and $478 | 3,841 | 3,577 |
Accounts receivable from affiliates | 20 | 22 |
Inventory | 2,209 | 2,527 |
Prepaid expenses | 670 | 624 |
Other current assets | 1,770 | 2,496 |
Total current assets | 18,779 | 23,885 |
Property and equipment, net | 40,549 | 41,175 |
Operating lease right-of-use assets | 27,793 | 28,021 |
Financing lease right-of-use assets | 2,899 | 3,028 |
Goodwill | 11,158 | 11,117 |
Spectrum licenses | 82,901 | 82,828 |
Other intangible assets, net | 4,892 | 5,298 |
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount of $124 and $127 | 2,221 | 2,031 |
Other assets | 12,140 | 2,779 |
Total assets | 203,332 | 200,162 |
Current liabilities | ||
Accounts payable and accrued liabilities | 8,712 | 10,196 |
Payables to affiliates | 108 | 157 |
Short-term debt | 4,423 | 4,579 |
Deferred revenue | 972 | 1,030 |
Short-term operating lease liabilities | 3,498 | 3,868 |
Short-term financing lease liabilities | 1,013 | 1,063 |
Other current liabilities | 769 | 810 |
Total current liabilities | 19,495 | 21,703 |
Long-term debt | 66,395 | 61,830 |
Long-term debt to affiliates | 4,721 | 4,716 |
Tower obligations | 2,974 | 3,028 |
Deferred tax liabilities | 10,154 | 9,966 |
Operating lease liabilities | 26,602 | 26,719 |
Financing lease liabilities | 1,316 | 1,444 |
Other long-term liabilities | 5,298 | 5,412 |
Total long-term liabilities | 117,460 | 113,115 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity | ||
Common Stock, par value $0.00001 per share, 2,000,000,000 shares authorized; 1,248,334,491 and 1,243,345,584 shares issued, 1,246,773,175 and 1,241,805,706 shares outstanding | 0 | 0 |
Additional paid-in capital | 72,839 | 72,772 |
Treasury stock, at cost, 1,561,316 and 1,539,878 shares issued | (14) | (11) |
Accumulated other comprehensive loss | (1,545) | (1,581) |
Accumulated deficit | (4,903) | (5,836) |
Total stockholders' equity | 66,377 | 65,344 |
Total liabilities and stockholders' equity | $ 203,332 | $ 200,162 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for credit losses | $ 143 | $ 194 |
Allowance for credit losses and imputed discount | 512 | 478 |
Allowance for credit losses and imputed discount | $ 124 | $ 127 |
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 1,248,334,491 | 1,243,345,584 |
Common stock, shares outstanding (in shares) | 1,246,773,175 | 1,241,805,706 |
Treasury stock, at cost (in shares) | 1,561,316 | 1,539,878 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues | ||
Revenues | $ 19,759 | $ 11,113 |
Operating expenses | ||
Selling, general and administrative | 4,805 | 3,688 |
Depreciation and amortization | 4,289 | 1,718 |
Total operating expenses | 17,620 | 9,574 |
Operating income | 2,139 | 1,539 |
Other income (expense) | ||
Interest expense | (792) | (185) |
Interest expense to affiliates | (46) | (99) |
Interest income | 3 | 12 |
Other expense, net | (125) | (10) |
Total other expense, net | (960) | (282) |
Income before income taxes | 1,179 | 1,257 |
Income tax expense | (246) | (306) |
Net income | 933 | 951 |
Other comprehensive income (loss), net of tax | ||
Unrealized gain (loss) on cash flow hedges, net of tax effect of $12 and $(276) | 34 | (792) |
Unrealized gain on foreign currency translation adjustment, net of tax effect of $— and $— | 2 | 0 |
Other comprehensive income (loss) | 36 | (792) |
Total comprehensive income | $ 969 | $ 159 |
Earnings per share | ||
Basic (in USD per share) | $ 0.75 | $ 1.11 |
Diluted (in USD per share) | $ 0.74 | $ 1.10 |
Weighted average shares outstanding | ||
Basic (in shares) | 1,243,520,026 | 858,148,284 |
Diluted (in shares) | 1,252,783,564 | 865,998,532 |
Postpaid revenues | ||
Revenues | ||
Revenues | $ 10,303 | $ 5,887 |
Prepaid revenues | ||
Revenues | ||
Revenues | 2,351 | 2,373 |
Wholesale revenues | ||
Revenues | ||
Revenues | 897 | 325 |
Roaming and other service revenues | ||
Revenues | ||
Revenues | 641 | 261 |
Service | ||
Revenues | ||
Revenues | 14,192 | 8,846 |
Operating expenses | ||
Cost of services and equipment sales | 3,384 | 1,639 |
Equipment | ||
Revenues | ||
Revenues | 5,346 | 2,117 |
Operating expenses | ||
Cost of services and equipment sales | 5,142 | 2,529 |
Other revenues | ||
Revenues | ||
Revenues | $ 221 | $ 150 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Cash flow hedges, tax effect | $ 12 | $ (276) |
Foreign currency translation adjustment, tax effect | $ 0 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities | ||
Net income | $ 933 | $ 951 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 4,289 | 1,718 |
Stock-based compensation expense | 138 | 138 |
Deferred income tax expense | 211 | 310 |
Bad debt expense | 82 | 113 |
(Gains) losses from sales of receivables | (18) | 25 |
Losses on redemption of debt | 101 | 0 |
Changes in operating assets and liabilities | ||
Accounts receivable | 96 | (748) |
Equipment installment plan receivables | (727) | 69 |
Inventories | 279 | (511) |
Operating lease right-of-use assets | 1,124 | 527 |
Other current and long-term assets | 54 | 6 |
Accounts payable and accrued liabilities | (1,384) | (405) |
Short and long-term operating lease liabilities | (1,369) | (725) |
Other current and long-term liabilities | (217) | 79 |
Other, net | 69 | 70 |
Net cash provided by operating activities | 3,661 | 1,617 |
Investing activities | ||
Purchases of property and equipment, including capitalized interest of $84 and $112 | (3,183) | (1,753) |
Purchases of spectrum licenses and other intangible assets, including deposits | (8,922) | (99) |
Proceeds related to beneficial interests in securitization transactions | 891 | 868 |
Net cash related to derivative contracts under collateral exchange arrangements | 0 | (580) |
Acquisition of companies, net of cash and restricted cash acquired | (29) | 0 |
Other, net | 4 | (16) |
Net cash used in investing activities | (11,239) | (1,580) |
Financing activities | ||
Proceeds from issuance of long-term debt | 6,763 | 0 |
Repayments of financing lease obligations | (287) | (282) |
Repayments of short-term debt for purchases of inventory, property and equipment and other financial liabilities | (55) | (25) |
Repayments of long-term debt | (2,219) | 0 |
Tax withholdings on share-based awards | (218) | (141) |
Cash payments for debt prepayment or debt extinguishment costs | (65) | 0 |
Other, net | (45) | (5) |
Net cash provided by (used in) financing activities | 3,874 | (453) |
Change in cash and cash equivalents, including restricted cash | (3,704) | (416) |
Cash and cash equivalents, including restricted cash | ||
Beginning of period | 10,463 | 1,528 |
End of period | $ 6,759 | $ 1,112 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Cash Flows [Abstract] | ||
Capitalized interest | $ 84 | $ 112 |
Condensed Consolidated Statem_5
Condensed Consolidated Statement of Stockholders' Equity - USD ($) $ in Millions | Total | Common Stock Outstanding | Treasury Shares at Cost | Par Value and Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2019 | 856,905,400 | |||||
Beginning balance at Dec. 31, 2019 | $ 28,789 | $ (8) | $ 38,498 | $ (868) | $ (8,833) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 951 | 951 | ||||
Other comprehensive (loss) income | (792) | (792) | ||||
Executive put option (in shares) | (342,000) | |||||
Executive put option | 1 | 1 | ||||
Stock-based compensation | 152 | 152 | ||||
Exercise of stock options (in shares) | 49,193 | |||||
Exercise of stock options | 1 | 1 | ||||
Stock issued for employee stock purchase plan (in shares) | 1,246,317 | |||||
Stock issued for employee stock purchase plan | 83 | 83 | ||||
Issuance of vested restricted stock units (in shares) | 4,755,209 | |||||
Shares withheld related to net share settlement of stock awards and stock options (in shares) | (1,490,399) | |||||
Shares withheld related to net share settlement of stock awards and stock options | (141) | (141) | ||||
Distribution from NQDC plan (in shares) | 4,386 | |||||
Distribution from NQDC plan | (3) | 3 | ||||
Prior year Retained Earnings | (67) | (67) | ||||
Ending balance (in shares) at Mar. 31, 2020 | 861,128,106 | |||||
Ending balance at Mar. 31, 2020 | $ 28,977 | (11) | 38,597 | (1,660) | (7,949) | |
Beginning balance (in shares) at Dec. 31, 2020 | 1,241,805,706 | 1,241,805,706 | ||||
Beginning balance at Dec. 31, 2020 | $ 65,344 | (11) | 72,772 | (1,581) | (5,836) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 933 | 933 | ||||
Other comprehensive (loss) income | 36 | 36 | ||||
Stock-based compensation | 154 | 154 | ||||
Exercise of stock options (in shares) | 80,802 | |||||
Exercise of stock options | 3 | 3 | ||||
Stock issued for employee stock purchase plan (in shares) | 1,272,253 | |||||
Stock issued for employee stock purchase plan | 125 | 125 | ||||
Issuance of vested restricted stock units (in shares) | 5,421,839 | |||||
Shares withheld related to net share settlement of stock awards and stock options (in shares) | (1,785,987) | |||||
Shares withheld related to net share settlement of stock awards and stock options | $ (218) | (218) | ||||
Transfer RSU from NQDC Plan (in shares) | (21,438) | |||||
Transfer RSU from NQDC plan | (3) | 3 | ||||
Ending balance (in shares) at Mar. 31, 2021 | 1,246,773,175 | 1,246,773,175 | ||||
Ending balance at Mar. 31, 2021 | $ 66,377 | $ (14) | $ 72,839 | $ (1,545) | $ (4,903) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1 – Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements of T-Mobile US, Inc. (“T-Mobile,” “we,” “our,” “us” or the “Company”) include all adjustments of a normal recurring nature necessary for the fair presentation of the results for the interim periods presented. The results for the interim periods are not necessarily indicative of those for the full year. The condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. The condensed consolidated financial statements include the balances and results of operations of T-Mobile and our consolidated subsidiaries. We consolidate majority-owned subsidiaries over which we exercise control, as well as variable interest entities (“VIEs”) where we are deemed to be the primary beneficiary and VIEs which cannot be deconsolidated, such as those related to our obligations to pay for the management and operation of certain of our wireless communications tower sites. Intercompany transactions and balances have been eliminated in consolidation. The preparation of financial statements in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions that affect the financial statements and accompanying notes. Estimates are based on historical experience, where applicable, and other assumptions that management believes are reasonable under the circumstances, including but not limited to, the valuation of assets acquired and liabilities assumed through the merger (the “Merger”) with Sprint Corporation (“Sprint”). These estimates are inherently subject to judgment and actual results could differ from those estimates. Accounting Pronouncements Not Yet Adopted Reference Rate Reform In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The standard provides temporary optional expedients and allows for certain exceptions to applying existing GAAP for contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued as a result of reference rate reform. The standard is available for adoption through December 31, 2022. We are currently evaluating the impact this standard will have, including optional expedients, on our condensed consolidated financial statements. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, or are not expected to have, a significant impact on our present or future condensed consolidated financial statements. |
Business Combination
Business Combination | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Business Combination | Note 2 – Business Combination Business Combination Agreement and Amendments On April 29, 2018, we entered into a Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) for the Merger. The Business Combination Agreement was subsequently amended to provide that, following the closing of the Merger and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”), SoftBank Group Corp. (“SoftBank”) would indemnify us against certain specified matters and the loss of value arising out of, or resulting from, cessation of access to spectrum under certain circumstances and subject to certain limitations and qualifications. On February 20, 2020, T-Mobile, SoftBank and Deutsche Telekom AG (“DT”) entered into a letter agreement (the “Letter Agreement”). Pursuant to the Letter Agreement, SoftBank agreed to cause its applicable affiliates to surrender to T-Mobile, for no additional consideration, an aggregate of 48,751,557 shares of T-Mobile common stock (such number of shares, the “SoftBank Specified Shares Amount”), effective immediately following the Effective Time (as defined in the Business Combination Agreement), making SoftBank’s exchange ratio 11.31 shares of Sprint common stock for each share of T-Mobile common stock. This resulted in an effective exchange ratio of approximately 11.00 shares of Sprint common stock for each share of T-Mobile common stock immediately following the closing of the Merger, an increase from the originally agreed 9.75 shares. Sprint stockholders other than SoftBank received the original fixed exchange ratio of 0.10256 shares of T-Mobile common stock for each share of Sprint common stock, or the equivalent of approximately 9.75 shares of Sprint common stock for each share of T-Mobile common stock. The Letter Agreement requires T-Mobile to issue to SoftBank 48,751,557 shares of T-Mobile common stock, subject to the terms and conditions set forth in the Letter Agreement, for no additional consideration, if certain conditions are met. The issuance of these shares is contingent on the trailing 45-day volume-weighted average price per share of T-Mobile common stock on the NASDAQ Global Select Market being equal to or greater than $150.00, at any time during the period commencing on April 1, 2022 and ending on December 31, 2025. If the threshold price is not met, then none of the SoftBank Specified Shares Amount will be issued. Closing of Sprint Merger On April 1, 2020, we completed the Merger, and as a result, Sprint and its subsidiaries became wholly owned consolidated subsidiaries of T-Mobile. Sprint was the fourth-largest telecommunications company in the U.S., offering a comprehensive range of wireless and wireline communication products and services. As a combined company, we expect to be able to rapidly launch a broad and deep nationwide 5G network, accelerate innovation, increase competition in the U.S. wireless and broadband industries and achieve significant synergies and cost reductions by eliminating redundancies within the combined network as well as other business processes and operations. Upon completion of the Merger, each share of Sprint common stock was exchanged for 0.10256 shares of T-Mobile common stock, or 9.75 shares of Sprint common stock for each share of T-Mobile common stock. After adjustments, including the holdback of the SoftBank Specified Shares Amount and fractional shares, we issued 373,396,310 shares of T-Mobile common stock to Sprint stockholders. The fair value of the T-Mobile common stock provided in exchange for Sprint common stock was approximately $31.3 billion. Additional components of consideration included the repayment of certain of Sprint’s debt, replacement of equity awards attributable to pre-combination services, contingent consideration and a cash payment received from SoftBank for certain reimbursed Merger expenses. Immediately following the closing of the Merger and the surrender of the SoftBank Specified Shares Amount, pursuant to the Letter Agreement described above, DT and SoftBank held, directly or indirectly, approximately 43.6% and 24.7%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 31.7% of the outstanding T-Mobile common stock held by other stockholders. Consideration Transferred The acquisition-date fair value of consideration transferred in the Merger totaled $40.8 billion, comprised of the following: (in millions) April 1, 2020 Fair value of T-Mobile common stock issued to Sprint stockholders (1) $ 31,328 Fair value of T-Mobile replacement equity awards attributable to pre-combination service (2) 323 Repayment of Sprint’s debt (including accrued interest and prepayment penalties) (3) 7,396 Value of contingent consideration (4) 1,882 Payment received from selling stockholder (5) (102) Total consideration exchanged $ 40,827 (1) Represents the fair value of T-Mobile common stock issued to Sprint stockholders pursuant to the Business Combination Agreement, less shares surrendered by SoftBank pursuant to the Letter Agreement. The fair value is based on 373,396,310 shares of Sprint common stock issued and outstanding as of March 31, 2020, an exchange ratio of 0.10256 shares of T-Mobile common stock per share of Sprint common stock, less 48,751,557 T-Mobile shares surrendered by SoftBank which are treated as contingent consideration, and the closing price per share of T-Mobile common stock on NASDAQ on March 31, 2020, of $83.90, as shares were transferred to Sprint stockholders prior to the opening of markets on April 1, 2020. (2) Equity-based awards held by Sprint employees prior to the acquisition date have been replaced with T-Mobile equity-based awards. The portion of the equity-based awards that relates to services performed by the employee prior to the acquisition date is included within consideration transferred, and includes stock options, restricted stock units and performance-based restricted stock units. (3) Represents the cash consideration paid concurrent with the close of the Merger to retire certain Sprint debt, as required by change in control provisions of the debt, plus interest and prepayment penalties. (4) Represents the fair value of the SoftBank Specified Shares Amount contingent consideration that may be issued as set forth in the Letter Agreement. (5) Represents receipt of a cash payment from SoftBank for certain expenses associated with the Merger. The SoftBank Specified Shares Amount was determined to be contingent consideration with an acquisition-date fair value of $1.9 billion. We estimated the fair value using the income approach, a probability-weighted discounted cash flow model, whereby a Monte Carlo simulation method estimated the probability of different outcomes as the likelihood of achieving the 45-day volume-weighted average price threshold is not easily predicted. This fair value measurement is based on significant inputs not observable in the market and, therefore, represents a Level 3 measurement as defined in ASC 820: Fair Value Measurement. The key assumptions in applying the income approach include estimated future share-price volatility, which was based on historical market trends and estimated future performance of T-Mobile. The maximum amount of contingent consideration that could be issued to SoftBank has an estimated value of $7.3 billion, based on SoftBank Specified Shares Amount of 48,751,557 multiplied by the defined volume-weighted average price per share of $150.00. The contingent consideration that could be delivered to SoftBank is classified within equity and is not subject to remeasurement. Fair Value of Assets Acquired and Liabilities Assumed We accounted for the Merger as a business combination. The identifiable assets acquired and liabilities assumed of Sprint were recorded at their fair values as of the acquisition date and consolidated with those of T-Mobile. Assigning fair market values to the assets acquired and liabilities assumed at the date of an acquisition requires the use of significant judgment regarding estimates and assumptions. For the fair values of the assets acquired and liabilities assumed, we used the cost, income and market approaches, including market participant assumptions. The following table summarizes the fair values for each major class of assets acquired and liabilities assumed at the acquisition date. We retained the services of certified valuation specialists to assist with assigning values to certain acquired assets and assumed liabilities. (in millions) April 1, 2020 Cash and cash equivalents $ 2,084 Accounts receivable 1,775 Equipment installment plan receivables 1,088 Inventory 658 Prepaid expenses 140 Assets held for sale 1,908 Other current assets 637 Property and equipment 18,435 Operating lease right-of-use assets 6,583 Financing lease right-of-use assets 291 Goodwill 9,423 Spectrum licenses 45,400 Other intangible assets 6,280 Equipment installment plan receivables due after one year, net 247 Other assets (1) 540 Total assets acquired 95,489 Accounts payable and accrued liabilities 5,015 Short-term debt 2,760 Deferred revenue 508 Short-term operating lease liabilities 1,818 Short-term financing lease liabilities 8 Liabilities held for sale 475 Other current liabilities 681 Long-term debt 29,037 Tower obligations 950 Deferred tax liabilities 3,478 Operating lease liabilities 5,615 Financing lease liabilities 12 Other long-term liabilities 4,305 Total liabilities assumed 54,662 Total consideration transferred $ 40,827 (1) Included in Other assets acquired is $80 million in restricted cash. Amounts previously disclosed for the estimated values of certain acquired assets and liabilities assumed have been adjusted based on additional information arising subsequent to the initial valuation. The measurement period adjustments we recognized during the three months ended March 31, 2021 did not have a significant impact on our Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2021. Intangible Assets and Liabilities Goodwill with an assigned value of $9.4 billion represents the excess of the consideration transferred over the fair values of assets acquired and liabilities assumed. The goodwill recognized includes synergies expected to be achieved from the operations of the combined company, the assembled workforce of Sprint and intangible assets that do not qualify for separate recognition. Expected synergies from the Merger include the cost savings from the planned integration of network infrastructure, facilities, personnel and systems. None of the goodwill resulting from the Merger is deductible for tax purposes. All of the goodwill acquired is allocated to the wireless reporting unit. Other intangible assets include $4.9 billion of customer relationships with a weighted-average useful life of eight years and tradenames of $207 million with a useful life of two years. Leased spectrum arrangements that have favorable (asset) and unfavorable (liability) terms compared to current market rates were assigned fair values of $745 million and $125 million, respectively, with 18-year and 19-year weighted average useful lives, respectively. The fair value of Spectrum licenses of $45.4 billion was estimated using the income approach, specifically a Greenfield model. This fair value measurement is based on significant inputs not observable in the market and, therefore, represents a Level 3 measurement as defined in ASC 820: Fair Value Measurement. The key assumptions in applying the income approach include the discount rate, estimated market share, estimated capital and operating expenditures, forecasted service revenue and a long-term growth rate for a hypothetical market participant that enters the wireless industry and builds a nationwide wireless network. Acquired Receivables The fair value of the assets acquired includes Accounts receivable of $1.8 billion and Equipment installment plan (“EIP”) receivables of $1.3 billion. The unpaid principal balance under these contracts as of April 1, 2020, the date of the Merger, was $1.8 billion and $1.6 billion, respectively. The difference between the fair value and the unpaid principal balance primarily represents amounts expected to be uncollectible. Indemnification Assets and Contingent Liabilities Pursuant to Amendment No 2. to the Business Combination Agreement, SoftBank agreed to indemnify us against certain specified matters and losses. As of the acquisition date, we recorded a contingent liability and an offsetting indemnification asset for the expected reimbursement by SoftBank for certain Lifeline matters. The liability is presented in Accounts payable and accrued liabilities, and the indemnification asset is presented in Other current assets within our acquired assets and liabilities at the acquisition date. In November 2020, we entered into a consent decree with the FCC to resolve certain Lifeline matters, which resulted in a payment of $200 million by SoftBank. Final resolution of this matter could require making additional reimbursements and paying additional fines and penalties, which we do not expect to have a significant impact on our financial results. We expect that any additional liabilities related to these matters would be indemnified and reimbursed by SoftBank. Deferred Taxes As a result of the Merger, we acquired deferred tax assets for which a valuation allowance reserve is deemed to be necessary, as well as additional uncertain tax benefit reserves. The amount of the valuation allowance reserve and uncertain tax benefit reserves was $851 million and $660 million, respectively. Transaction Costs We recognized transaction costs of $13 million and $38 million for the three months ended March 31, 2021 and 2020, respectively. These costs were associated with legal and professional services and were recognized as Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income. Pro Forma Information The following unaudited pro forma financial information gives effect to the Transactions as if they had been completed on January 1, 2019. The unaudited pro forma information was prepared in accordance with the requirements of ASC 805: Business Combinations, which is a different basis than pro forma information prepared under Article 11 of Regulation S-X (“Article 11”). As such, they are not directly comparable with historical results for stand-alone T-Mobile prior to April 1, 2020, historical results for T-Mobile from April 1, 2020 that reflect the Transactions and are inclusive of the results and operations of Sprint, nor our previously provided pro forma financials prepared in accordance with Article 11. The pro forma results for the three months ended March 31, 2020 include the impact of several significant nonrecurring pro forma adjustments to previously reported operating results. The pro forma adjustments are based on historically reported transactions by the respective companies. The pro forma results do not include any anticipated synergies or other expected benefits of the acquisition. (in millions) Three Months Ended March 31, 2020 Total revenues $ 17,408 Income from continuing operations 1,111 Income from discontinued operations, net of tax 357 Net income 1,468 Significant nonrecurring pro forma adjustments include: • Transaction costs of $57 million that were incurred during the three months ended March 31, 2020 are assumed to have occurred on the pro forma close date of January 1, 2019, and are recognized as if incurred in the first quarter of 2019; • The Prepaid Business divested on July 1, 2020, is assumed to have been classified as discontinued operations as of January 1, 2019, and the related activities are presented in Income from discontinued operations, net of tax; • Permanent financing issued and debt redemptions occurring in connection with the closing of the Merger are assumed to have occurred on January 1, 2019, and historical interest expense associated with repaid borrowings is removed; • Tangible and intangible assets are assumed to be recorded at their estimated fair values as of January 1, 2019 and are depreciated or amortized over their estimated useful lives; and • Accounting policies of Sprint are conformed to those of T-Mobile including depreciation for leased devices, Brightstar distribution, amortization of costs to acquire a contract and certain tower lease transactions. The selected unaudited pro forma condensed combined financial information is provided for illustrative purposes only and does not purport to represent what the actual consolidated results of operations would have been had the Transactions actually occurred on January 1, 2019, nor do they purport to project the future consolidated results of operations. Regulatory Matters The Transactions were the subject of various legal and regulatory proceedings involving a number of state and federal agencies. In connection with those proceedings and the approval of the Transactions, we have certain commitments and other obligations to various state and federal agencies and certain nongovernmental organizations. See Note 1 1 - Commitments and Contingencies for further information. Shenandoah Personal Communications Company Affiliate Relationship Sprint PCS (specifically Sprint Spectrum L.P.) is party to a variety of publicly filed agreements with Shenandoah Personal Communications Company LLC (“Shentel”), pursuant to which Shentel is the exclusive provider of Sprint PCS’s wireless mobility communications network products in certain parts of Maryland, North Carolina, Virginia, West Virginia, Kentucky, Ohio and Pennsylvania. Pursuant to one such agreement, the Sprint PCS Management Agreement, dated November 5, 1999 (as amended, supplemented and modified from time to time, the “Management Agreement”), Sprint PCS was granted an option to purchase Shentel’s wireless telecommunications assets used to provide services pursuant to the Management Agreement. On August 26, 2020, Sprint, now our direct subsidiary, on behalf of and as the direct or indirect owner of Sprint PCS, exercised its option by delivering a binding notice of exercise to Shentel. The exercise of this option triggered a requirement for the parties to engage three independent valuation providers to calculate the “entire business value” (the “Entire Business Value”) of such wireless telecommunications assets, pursuant to a formula and valuation process prescribed in the Management Agreement. |
Receivables and Expected Credit
Receivables and Expected Credit Losses | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Receivables and Expected Credit Losses | Note 3 – Receivables and Expected Credit Losses We maintain an allowance for expected credit losses that assesses the lifetime credit losses that we expect to incur related to our receivable portfolio segments. Each period, management assesses the appropriateness of the level of allowance for credit losses by considering credit risk inherent within each portfolio segment as of period end. We consider a receivable past due when a customer has not paid us by the contractually specified payment due date. Account balances are written off against the allowance for credit losses if collection efforts are unsuccessful and the receivable balance is deemed uncollectible, based on factors such as customer credit ratings as well as the length of time the amounts are past due. Our portfolio of receivables is comprised of two portfolio segments: accounts receivable and EIP receivables. Accounts Receivable Portfolio Segment Our accounts receivable segment primarily consists of amounts currently due from customers, including service and leased device receivables, device insurance administrators, wholesale partners, third-party retail channels and other carriers. We estimate expected credit losses associated with our accounts receivable portfolio using an aging schedule methodology that utilizes historical information and current conditions to develop expected credit losses by aging bucket, including for receivables that are not past due. To determine the appropriate credit loss percentages by aging bucket, we consider a number of factors, including our overall historical credit losses, net of recoveries and timely payment experience as well as current collection trends such as write-off frequency and severity, credit quality of the customer base, and other qualitative factors such as macro-economic conditions, including the expected economic impacts of the COVID-19 pandemic (the “Pandemic”). We consider the need to adjust our estimate of expected credit losses for reasonable and supportable forecasts of future economic conditions. To do so, we monitor professional forecasts of changes in real U.S. gross domestic product and forecasts of consumer credit behavior for comparable credit exposures. We also periodically evaluate other economic indicators such as unemployment rates to assess their level of correlation with our historical credit loss statistics. EIP Receivables Portfolio Segment Based upon customer credit profiles at the time of customer origination, we classify the EIP receivables segment into two customer classes of “Prime” and “Subprime.” Prime customer receivables are those with lower credit risk and Subprime customer receivables are those with higher credit risk. Customers may be required to make a down payment on their equipment purchases. In addition, certain customers within the Subprime category are required to pay a deposit. To determine a customer’s credit profile, we use a proprietary credit scoring model that measures the credit quality of a customer using several factors, such as credit bureau information, consumer credit risk scores and service and device plan characteristics. Installment loans acquired in the Merger are included in EIP receivables. We applied our proprietary credit scoring model to the customers acquired in the Merger with an outstanding EIP receivable balance. Based on tenure, consumer credit risk score and credit profile, these acquired customers were classified into our customer classes of Prime or Subprime. Our proprietary credit scoring model is applied to all EIP arrangements originated after the Merger close date. The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses: (in millions) March 31, December 31, EIP receivables, gross $ 6,698 $ 6,213 Unamortized imputed discount (356) (325) EIP receivables, net of unamortized imputed discount 6,342 5,888 Allowance for credit losses (280) (280) EIP receivables, net of allowance for credit losses and imputed discount $ 6,062 $ 5,608 Classified on the balance sheet as: Equipment installment plan receivables, net of allowance for credit losses and imputed discount $ 3,841 $ 3,577 Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount 2,221 2,031 EIP receivables, net of allowance for credit losses and imputed discount $ 6,062 $ 5,608 We manage our EIP receivables portfolio using delinquency and customer credit class as key credit quality indicators. The following table presents the amortized cost of our EIP receivables by delinquency status, customer credit class, and year of origination as of March 31, 2021: Originated in 2021 Originated in 2020 Originated prior to 2020 Total EIP Receivables, net of (in millions) Prime Subprime Prime Subprime Prime Subprime Prime Subprime Grand total Current - 30 days past due $ 1,180 $ 1,005 $ 1,999 $ 1,455 $ 383 $ 225 $ 3,562 $ 2,685 $ 6,247 31 - 60 days past due 5 5 13 20 3 5 21 30 51 61 - 90 days past due — 1 5 10 2 2 7 13 20 More than 90 days past due — — 5 11 2 6 7 17 24 EIP receivables, net of unamortized imputed discount $ 1,185 $ 1,011 $ 2,022 $ 1,496 $ 390 $ 238 $ 3,597 $ 2,745 $ 6,342 We estimate expected credit losses on our EIP receivables by using historical data adjusted for current conditions to calculate default probabilities for our outstanding EIP loans. We consider various risk characteristics when calculating default probabilities, such as how long such loans have been outstanding, customer credit ratings, customer tenure, delinquency status and other correlated variables identified through statistical analyses. We multiply these estimated default probabilities by our estimated loss given default, which considers recoveries. As we do for our accounts receivable portfolio segment, we consider the need to adjust our estimate of expected losses on EIP receivables for reasonable and supportable forecasts of economic conditions through monitoring external professional forecasts and periodic internal statistical analyses, including the expected economic impacts of the Pandemic. For EIP receivables acquired in the Merger, the difference between the fair value and unpaid principal balance of the loan at the acquisition date is accreted to interest income over the contractual life of the loan using the effective interest method. EIP receivables had a combined weighted average effective interest rate of 6.7% as of both March 31, 2021 and December 31, 2020. Activity for the three months ended March 31, 2021 and 2020, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows: March 31, 2021 March 31, 2020 (in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total Allowance for credit losses and imputed discount, beginning of period $ 194 $ 605 $ 799 $ 61 $ 399 $ 460 Beginning balance adjustment due to implementation of the new credit loss standard — — — — 91 91 Bad debt expense 28 54 82 42 71 113 Write-offs, net of recoveries (79) (54) (133) (34) (61) (95) Change in imputed discount on short-term and long-term EIP receivables N/A 66 66 N/A 5 5 Impact on the imputed discount from sales of EIP receivables N/A (35) (35) N/A (36) (36) Allowance for credit losses and imputed discount, end of period $ 143 $ 636 $ 779 $ 69 $ 469 $ 538 Off-Balance-Sheet Credit Exposures We do not have material, unmitigated off-balance-sheet credit exposures as of March 31, 2021. In connection with the sales of certain service and EIP accounts receivable pursuant to the sale arrangements, we have deferred purchase price assets included in our Condensed Consolidated Balance Sheets measured at fair value that are based on a discounted cash flow model using Level 3 inputs, including customer default rates and credit worthiness, dilutions and recoveries. See Note 4 – Sales of Certain Receivables for further information. |
Sales of Certain Receivables
Sales of Certain Receivables | 3 Months Ended |
Mar. 31, 2021 | |
Transfers and Servicing [Abstract] | |
Sales of Certain Receivables | Note 4 – Sales of Certain Receivables We have entered into transactions to sell certain service accounts receivable and EIP receivables. The transactions, including our continuing involvement with the sold receivables and the respective impacts to our condensed consolidated financial statements, are described below. Sales of EIP Receivables Overview of the Transaction In 2015, we entered into an arrangement to sell certain EIP receivables on a revolving basis (the “EIP sale arrangement”). The maximum funding commitment of the sale arrangement is $1.3 billion. The scheduled expiration date of the EIP sale arrangement is November 18, 2021. On April 30, 2020, we agreed with the purchaser banks to update our collection policies to temporarily allow for flexibility for modifications to the EIP receivables sold that are impacted by the Pandemic and exclusion of such EIP receivables from all pool performance triggers. As of both March 31, 2021 and December 31, 2020, the EIP sale arrangement provided funding of $1.3 billion. Sales of EIP receivables occur daily and are settled on a monthly basis. In connection with this EIP sale arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity (the “EIP BRE”). Pursuant to the EIP sale arrangement, our wholly owned subsidiary transfers selected receivables to the EIP BRE. The EIP BRE then sells the receivables to a non-consolidated and unaffiliated third-party entity over which we do not exercise any level of control, nor does the third-party entity qualify as a VIE. Variable Interest Entity We determined that the EIP BRE is a VIE as its equity investment at risk lacks the obligation to absorb a certain portion of its expected losses. We have a variable interest in the EIP BRE and have determined that we are the primary beneficiary based on our ability to direct the activities which most significantly impact the EIP BRE’s economic performance. Those activities include selecting which receivables are transferred into the EIP BRE and sold in the EIP sale arrangement and funding of the EIP BRE. Additionally, our equity interest in the EIP BRE obligates us to absorb losses and gives us the right to receive benefits from the EIP BRE that could potentially be significant to the EIP BRE. Accordingly, we include the balances and results of operations of the EIP BRE in our condensed consolidated financial statements. The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the EIP BRE: (in millions) March 31, December 31, Other current assets $ 390 $ 388 Other assets 113 120 Other long-term liabilities 4 4 In addition, the EIP BRE is a separate legal entity with its own separate creditors who will be entitled, prior to any liquidation of the EIP BRE, to be satisfied prior to any value in the EIP BRE becoming available to us. Accordingly, the assets of the EIP BRE may not be used to settle our general obligations and creditors of the EIP BRE have limited recourse to our general credit. Sales of Service Accounts Receivable Overview of the Transaction In 2014, we entered into an arrangement to sell certain service accounts receivable on a revolving basis (the “service receivable sale arrangement”). The maximum funding commitment of the service receivable sale arrangement is $950 million, and the facility expires in March 2022. As of March 31, 2021 and December 31, 2020, the service receivable sale arrangement provided funding of $775 million and $772 million, respectively. Sales of receivables occur daily and are settled on a monthly basis. The receivables consist of service charges currently due from customers and are short-term in nature. In connection with the service receivable sale arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity, to sell service accounts receivable (the “Service BRE”). In March 2021, we amended the sale arrangement to conform its structure to the EIP sale arrangement (the “March 2021 Amendment”). This involved, among other things, removal of an unaffiliated special purpose entity that we did not consolidate under the original structure and changes in contractual counterparties. While the amendment simplified the structure of the arrangement making it more efficient, it did not impact the maximum funding commitment under, or the level of funding provided by, the facility. Pursuant to the amended service receivable sale arrangement, our wholly owned subsidiary transfers selected receivables to the Service BRE. The Service BRE then sells the receivables to a non-consolidated and unaffiliated third-party entity over which we do not exercise any level of control and which does not qualify as a VIE. Variable Interest Entity Prior to the March 2021 Amendment, the Service BRE did not qualify as a VIE, but due to the significant level of control we exercised over the entity, it was consolidated. The March 2021 Amendment to the service receivable sale arrangement triggered a VIE reassessment, and we determined that the Service BRE now qualifies as a VIE. We have a variable interest in the Service BRE and have determined that we are the primary beneficiary based on our ability to direct the activities that most significantly impact the Service BRE’s economic performance. Those activities include selecting which receivables are transferred into the Service BRE and sold in the service receivable sale arrangement and funding the Service BRE. Additionally, our equity interest in the Service BRE obligates us to absorb losses and gives us the right to receive benefits from the Service BRE that could potentially be significant to the Service BRE. Accordingly, we include the balances and results of operations of the Service BRE in our condensed consolidated financial statements. The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the Service BRE: (in millions) March 31, December 31, Other current assets $ 268 $ 378 Other current liabilities 248 357 In addition, the Service BRE is a separate legal entity with its own separate creditors who will be entitled, prior to any liquidation of the Service BRE, to be satisfied prior to any value in the Service BRE becoming available to us. Accordingly, the assets of the Service BRE may not be used to settle our general obligations, and creditors of the Service BRE have limited recourse to our general credit. Sales of Receivables The transfers of service receivables and EIP receivables to the non-consolidated entities are accounted for as sales of financial assets. Once identified for sale, the receivable is recorded at the lower of cost or fair value. Upon sale, we derecognize the net carrying amount of the receivables. We recognize the cash proceeds received upon sale in Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows. We recognize proceeds net of the deferred purchase price, consisting of a receivable from the purchasers that entitles us to certain collections on the receivables. We recognize the collection of the deferred purchase price in Net cash used in investing activities in our Condensed Consolidated Statements of Cash Flows as Proceeds related to beneficial interests in securitization transactions. The deferred purchase price represents a financial asset that is primarily tied to the creditworthiness of the customers and which can be settled in such a way that we may not recover substantially all of our recorded investment, due to default by the customers on the underlying receivables. At inception, we elected to measure the deferred purchase price at fair value with changes in fair value included in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income. The fair value of the deferred purchase price is determined based on a discounted cash flow model which uses primarily Level 3 inputs, including customer default rates. As of March 31, 2021 and December 31, 2020, our deferred purchase price related to the sales of service receivables and EIP receivables was $769 million and $884 million, respectively. The following table summarizes the impact of the sale of certain service receivables and EIP receivables in our Condensed Consolidated Balance Sheets: (in millions) March 31, December 31, Derecognized net service receivables and EIP receivables $ 2,537 $ 2,528 Other current assets 658 766 of which, deferred purchase price 656 764 Other long-term assets 113 120 of which, deferred purchase price 113 120 Other current liabilities 248 357 Other long-term liabilities 4 4 Net cash proceeds since inception 1,737 1,715 Of which: Change in net cash proceeds during the year-to-date period 22 (229) Net cash proceeds funded by reinvested collections 1,715 1,944 We recognized a gain from sales of receivables, including adjustments to the receivables’ fair values and changes in fair value of the deferred purchase price, of $18 million and a loss from sales of receivables of $25 million for the three months ended March 31, 2021 and 2020, respectively, in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income. Continuing Involvement Pursuant to the sale arrangements described above, we have continuing involvement with the service receivables and EIP receivables we sell as we service the receivables, are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where write-off is imminent, and may be responsible for absorbing credit losses through reduced collections on our deferred purchase price assets. We continue to service the customers and their related receivables, including facilitating customer payment collection, in exchange for a monthly servicing fee. As the receivables are sold on a revolving basis, the customer payment collections on sold receivables may be reinvested in new receivable sales. At the direction of the purchasers of the sold receivables, we apply the same policies and procedures while servicing the sold receivables as we apply to our owned receivables, and we continue to maintain normal relationships with our customers. Pursuant to the EIP sale arrangement, under certain circumstances, we are required to deposit cash or replacement EIP receivables primarily for contracts terminated by customers under our JUMP! program. |
Goodwill, Spectrum License Tran
Goodwill, Spectrum License Transactions and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Spectrum License Transactions and Other Intangible Assets | Note 5 – Goodwill, Spectrum License Transactions and Other Intangible Assets Goodwill The changes in the carrying amount of goodwill for the three months ended March 31, 2021 and year ended December 31, 2020, are as follows: (in millions) Goodwill Historical goodwill, net of accumulated impairment losses of $10,766 $ 1,930 Goodwill from acquisitions in 2020 9,405 Layer3 goodwill impairment (218) Balance as of December 31, 2020 11,117 Purchase price adjustment of goodwill from acquisitions in 2020 22 Goodwill from acquisitions in 2021 19 Balance as of March 31, 2021 $ 11,158 Accumulated impairment losses at March 31, 2021 $ (10,984) On April 1, 2020, we completed our Merger with Sprint, which was accounted for as a business combination resulting in $9.4 billion in goodwill. The acquired goodwill was allocated to the wireless reporting unit and will be tested for impairment at this level. See Note 2 - Business Combination for further information. Intangible Assets Identifiable Intangible Assets Acquired The following table summarizes the fair value of the intangible assets acquired in the Merger: Weighted Average Useful Life (in years) Fair Value as of April 1, 2020 Spectrum licenses Indefinite-lived $ 45,400 Tradenames (1) 2 years 207 Customer relationships 8 years 4,900 Favorable spectrum leases 18 years 745 Other intangible assets 7 years 428 Total intangible assets acquired $ 51,680 (1) Tradenames include the Sprint brand. Spectrum licenses are issued for a fixed period of time, typically up to 15 years; however, the FCC has granted license renewals routinely and at a nominal cost. The spectrum licenses acquired expire at various dates and we believe we will be able to meet all requirements necessary to secure renewal of our spectrum licenses at a nominal cost. Moreover, we determined that there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful lives of our spectrum licenses. Therefore, we determined the spectrum licenses should be treated as indefinite-lived intangible assets. The fair value of spectrum licenses includes the value associated with aggregating a nationwide portfolio of owned and leased spectrum. Favorable spectrum leases represent a contract where the market rate is higher than the future contractual lease payments. We lease this spectrum from third parties who hold the spectrum licenses. As these contracts pertain to intangible assets, they are excluded from the lease accounting guidance (ASC 842) and are accounted for as service contracts in which the expense is recognized on a straight-line basis over the lease team. Favorable spectrum leases of $745 million were recorded as an intangible asset as a result of purchase accounting and are amortized on a straight-line basis over the associated remaining lease term. Additionally, we recognized unfavorable spectrum lease liabilities of $125 million, which are also amortized over their respective remaining lease terms and are included in Other liabilities in our Condensed Consolidated Balance Sheets. The customer relationship intangible assets represent the value associated with the acquired Sprint customers. The customer relationship intangible assets are amortized using the sum-of-the-years’ digits method over periods of up to eight years. Other intangible assets are amortized over the remaining period that the asset is expected to provide benefit to us. Spectrum Licenses The following table summarizes our spectrum license activity for the three months ended March 31, 2021: (in millions) 2021 Spectrum licenses, beginning of year $ 82,828 Spectrum license acquisitions 72 Costs to clear spectrum 1 Spectrum licenses, end of period $ 82,901 In March 2021, the Federal Communications Commission (“FCC”), announced that we were the winning bidder of 142 licenses in Auction 107 (C-band spectrum) for an aggregate purchase price of $9.3 billion, excluding relocation costs. At the inception of Auction 107 in October 2020, we deposited $438 million. Upon conclusion of Auction 107 in March 2021, we paid the FCC the remaining $8.9 billion for the licenses won in the auction. We expect to incur an additional $1.2 billion in relocation costs which will be paid through 2024. The aggregate cash payments made to the FCC are included in Other assets as of March 31, 2021 in our Condensed Consolidated Balance Sheets, and will remain there until the corresponding licenses are received. The timing of when the licenses will be issued will be determined by the FCC after all post-auction procedures have been completed. Cash payments to acquire spectrum licenses and payments for costs to clear spectrum are included in Purchases of spectrum licenses and other intangible assets, including deposits in our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021. Other Intangible Assets The components of Other intangible assets were as follows: Useful Lives March 31, 2021 December 31, 2020 (in millions) Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Customer relationships Up to 8 years $ 4,903 $ (1,153) $ 3,750 $ 4,900 $ (865) $ 4,035 Tradenames and patents Up to 19 years 603 (461) 142 598 (412) 186 Favorable spectrum leases Up to 27 years 741 (44) 697 790 (35) 755 Other Up to 10 years 377 (74) 303 377 (55) 322 Other intangible assets $ 6,624 $ (1,732) $ 4,892 $ 6,665 $ (1,367) $ 5,298 Amortization expense for intangible assets subject to amortization was $366 million and $25 million for the three months ended March 31, 2021 and 2020, respectively. The estimated aggregate future amortization expense for intangible assets subject to amortization are summarized below: (in millions) Estimated Future Amortization Twelve Months Ending March 31, 2022 $ 1,154 2023 941 2024 785 2025 627 2026 468 Thereafter 917 Total $ 4,892 Substantially all of the estimated future amortization expense is associated with intangible assets acquired in the Merger. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 6 – Fair Value Measurements The carrying values of Cash and cash equivalents, Accounts receivable, Accounts receivable from affiliates, Accounts payable and accrued liabilities and borrowings under vendor financing arrangements with our primary network equipment suppliers approximate fair value due to the short-term maturities of these instruments. Derivative Financial Instruments Periodically, we use derivatives to manage exposure to market risk, such as interest rate risk. We designate certain derivatives as hedging instruments in a qualifying hedge accounting relationship (cash flow hedge) to help minimize significant, unplanned fluctuations in cash flows caused by interest rate volatility. We do not use derivatives for trading or speculative purposes. Interest Rate Lock Derivatives In October 2018, we entered into interest rate lock derivatives with notional amounts of $9.6 billion. In November 2019, we extended the mandatory termination date on our interest rate lock derivatives to June 3, 2020. For the three months ended March 31, 2020, we made net collateral transfers to certain of our derivative counterparties totaling $580 million, which included variation margin transfers to (or from) such derivative counterparties based on daily market movements. No amounts were transferred to the derivative counterparties subsequent to March 31, 2020. These collateral transfers are included in Net cash related to derivative contracts under collateral exchange arrangements within Net cash used in investing activities in our Condensed Consolidated Statements of Cash Flows. We recorded interest rate lock derivatives on our Condensed Consolidated Balance Sheets at fair value that was derived primarily from observable market data, including yield curves. Interest rate lock derivatives were classified as Level 2 in the fair value hierarchy. Cash flows associated with qualifying hedge derivative instruments are presented in the same category on the Condensed Consolidated Statements of Cash Flows as the item being hedged. Aggregate changes in the fair value of the interest rate lock derivatives, net of tax and amortization, of $1.6 billion are presented in Accumulated other comprehensive loss as of both March 31, 2021 and December 31, 2020. Between April 2 and April 6, 2020, in connection with the issuance of an aggregate of $19.0 billion of Senior Secured Notes bearing interest rates ranging from 3.500% to 4.500% and maturing in 2025 through 2050, we terminated our interest rate lock derivatives. Upon the issuance of debt to which the hedged interest rate risk related, we began amortizing the Accumulated other comprehensive loss with the derivatives into Interest expense in a manner consistent with how the hedged interest payments affect earnings. For the three months ended March 31, 2021, $46 million was amortized from Accumulated other comprehensive loss into Interest expense in the Condensed Consolidated Statements of Comprehensive Income. No amounts were amortized into Interest expense for the three months ended March 31, 2020. We expect to amortize $192 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense over the next 12 months. Deferred Purchase Price Assets In connection with the sales of certain service and EIP accounts receivable pursuant to the sale arrangements, we have deferred purchase price assets measured at fair value that are based on a discounted cash flow model using unobservable Level 3 inputs, including customer default rates. See Note 4 – Sales of Certain Receivables for further information. The carrying amounts of our deferred purchase price assets, which are measured at fair value on a recurring basis and are included in our Condensed Consolidated Balance Sheets, were $769 million and $884 million at March 31, 2021 and December 31, 2020, respectively. Fair value was equal to carrying amount at March 31, 2021 and December 31, 2020. Debt The fair value of our Senior Unsecured Notes and Senior Secured Notes to third parties was determined based on quoted market prices in active markets, and therefore were classified as Level 1 within the fair value hierarchy. The fair value of our Senior Notes to affiliates was determined based on a discounted cash flow approach using market interest rates of instruments with similar terms and maturities and an estimate for our standalone credit risk. Accordingly, our Senior Notes to affiliates were classified as Level 2 within the fair value hierarchy. Although we have determined the estimated fair values using available market information and commonly accepted valuation methodologies, considerable judgment was required in interpreting market data to develop fair value estimates for the Senior Notes to affiliates. The fair value estimates were based on information available as of March 31, 2021 and December 31, 2020. As such, our estimates are not necessarily indicative of the amount we could realize in a current market exchange. The carrying amounts and fair values of our short-term and long-term debt included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy March 31, 2021 December 31, 2020 (in millions) Carrying Amount (1) Fair Value (1) Carrying Amount (1) Fair Value (1) Liabilities: Senior Unsecured Notes to third parties 1 $ 34,648 $ 36,563 $ 29,966 $ 32,450 Senior Notes to affiliates 2 4,721 4,941 4,716 4,991 Senior Secured Notes to third parties 1 35,983 37,821 36,204 40,519 (1) Excludes $186 million and $240 million as of March 31, 2021 and December 31, 2020, respectively, in vendor financing arrangements and other debt as the carrying values approximate fair value primarily due to the short-term maturities of these instruments. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 7 – Debt The following table sets forth the debt balances and activity as of, and for the three months ended, March 31, 2021 : (in millions) December 31, Proceeds from Issuances and Borrowings (1) Note Redemptions (1) Repayments Reclassifications (1) Other (2) March 31, Short-term debt $ 4,579 $ — $ — $ (274) $ 144 $ (26) $ 4,423 Long-term debt 61,830 6,758 (1,964) — (144) (85) 66,395 Total debt to third parties 66,409 6,758 (1,964) (274) — (111) 70,818 Long-term debt to affiliates 4,716 — — — — 5 4,721 Total debt $ 71,125 $ 6,758 $ (1,964) $ (274) $ — $ (106) $ 75,539 (1) Issuances and borrowings, note redemptions, and reclassifications are recorded net of related issuance costs, discounts and premiums. (2) Other includes the amortization of premiums, discounts, debt issuance costs and consent fees. Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.3% and 5.2% for the three months ended March 31, 2021 and 2020, respectively, on weighted average debt outstanding of $73.7 billion and $25.0 billion for the three months ended March 31, 2021 and 2020, respectively. The weighted average debt outstanding was calculated by applying an average of the monthly ending balances of total short-term and long-term debt and short-term and long-term debt to affiliates, net of unamortized premiums, discounts, debt issuance costs and consent fees. Issuances and Borrowings During the three months ended March 31, 2021, we issued the following Senior Notes: (in millions) Principal Issuances Issuance Costs Net Proceeds from Issuance of Long-Term Debt Issue Date 2.250% Senior Notes due 2026 $ 1,000 $ (7) $ 993 January 14, 2021 2.625% Senior Notes due 2029 1,000 (7) 993 January 14, 2021 2.875% Senior Notes due 2031 1,000 (7) 993 January 14, 2021 2.625% Senior Notes due 2026 1,200 (7) 1,193 March 23, 2021 3.375% Senior Notes due 2029 1,250 (7) 1,243 March 23, 2021 3.500% Senior Notes due 2031 1,350 (7) 1,343 March 23, 2021 Total of Senior Notes issued $ 6,800 $ (42) $ 6,758 Credit Facilities On October 30, 2020, we entered into a $5.0 billion senior secured term loan commitment with certain financial institutions. On January 14, 2021, we issued an aggregate of $3.0 billion of Senior Notes. A portion of the senior secured term loan commitment was reduced by an amount equal to the aggregate gross proceeds of the Senior Notes, which reduced the commitment to $2.0 billion. On March 23, 2021, we issued an aggregate of $3.8 billion of Senior Notes. The senior secured term loan commitment was terminated upon the issuance of the $3.8 billion of Senior Notes. Senior Notes On January 14, 2021, we issued $1.0 billion of 2.250% Senior Notes due 2026, $1.0 billion of 2.625% Senior Notes due 2029, and $1.0 billion of 2.875% Senior Notes due 2031. On March 23, 2021, we issued $1.2 billion of 2.625% Senior Notes due 2026, $1.25 billion of 3.375% Senior Notes due 2029, and $1.35 billion of 3.500% Senior Notes due 2031. Note Redemption On March 27, 2021, we redeemed $2.0 billion aggregate principal amount of our 6.500% Senior Notes due 2026. The notes were redeemed at a redemption price equal to 103.250% of the principal amount of the notes (plus accrued and unpaid interest thereon), and were paid on March 26, 2021. The redemption premium was $65 million and the write off of issuance costs and consent fees was approximately $36 million, which was included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income and Losses on redemption of debt in our Condensed Consolidated Statements of Cash Flows. Restricted Cash Certain provisions of our debt agreements require us to maintain specified cash collateral balances. Amounts associated with these balances are considered to be restricted cash. |
Tower Obligations
Tower Obligations | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Tower Obligations | Note 8 – Tower Obligations Existing CCI Tower Lease Arrangements In 2012, we conveyed to Crown Castle International Corp. (“CCI”) the exclusive right to manage and operate approximately 6,200 tower sites (“CCI Lease Sites”) via a master prepaid lease with site lease terms ranging from 23 to 37 years (the “2012 Tower Transaction”). CCI has fixed-price purchase options for the CCI Lease Sites totaling approximately $2.0 billion, exercisable at the end of the lease term. We lease back a portion of the space at certain tower sites for an initial term of 10 years, followed by optional renewals at customary terms. Assets and liabilities associated with the operation of the tower sites were transferred to special purpose entities (“SPEs”). Assets included ground lease agreements or deeds for the land on which the towers are situated, the towers themselves and existing subleasing agreements with other mobile network operator tenants that lease space at the tower sites. Liabilities included the obligation to pay ground lease rentals, property taxes and other executory costs. We determined the SPEs containing the CCI Lease Sites (“Lease Site SPEs”) are VIEs as they lack sufficient equity to finance their activities. We have a variable interest in the Lease Site VIE but are not the primary beneficiary as we lack the power to direct the activities that most significantly impact the Lease Site VIE’s economic performance. These activities include managing tenants and underlying ground leases, performing repair and maintenance on the towers, the obligation to absorb expected losses and the right to receive the expected future residual returns from the purchase option to acquire the CCI Lease Sites. As we determined that we are not the primary beneficiary and do not have a controlling financial interest in the Lease Site SPEs, the Lease Site SPEs are not included in our condensed consolidated financial statements. However, we also considered if this arrangement resulted in the sale of the CCI Lease Sites for which we would de-recognize the tower assets. By assessing whether control had transferred, we concluded that transfer of control criteria, as discussed in the revenue standard, were not met. Accordingly, we recorded this arrangement as a financing whereby we recorded debt, a financial obligation, and the CCI Lease Sites tower assets remained on our balance sheet. We recorded long-term financial obligations in the amount of the net proceeds received and recognize interest on the tower obligations at a rate of approximately 8% using the effective interest method. The tower obligations are increased by interest expense and amortized through contractual leaseback payments made by us to CCI and through net cash flows generated and retained by CCI from operation of the tower sites. Acquired CCI Tower Lease Arrangements Prior to the Merger, Sprint entered into a lease-out and leaseback arrangement with Global Signal Inc., a third party that was subsequently acquired by CCI, that conveyed to CCI the exclusive right to manage and operate approximately 6,400 tower sites (“Master Lease Sites”) via a master prepaid lease. These agreements were assumed upon the close of the Merger, at which point the remaining term of the lease-out was approximately 17 years with no renewal options. CCI has a fixed price purchase option for all (but not less than all) of the leased or subleased sites for approximately $2.3 billion, exercisable one year prior to the expiration of the agreement and ending 120 days prior to the expiration of the agreement. We lease back a portion of the space at certain tower sites for an initial term of 10 years, followed by optional renewals at customary terms. We considered if this arrangement resulted in the sale of the Master Lease Sites for which we would de-recognize the tower assets. By assessing whether control had transferred, we concluded that transfer of control criteria, as discussed in the revenue standard, were not met. Accordingly, we recorded this arrangement as a financing whereby we recorded debt, a financial obligation, and the Master Lease Sites tower assets remained on our balance sheet. As of the Merger date, we recognized Property and equipment with a fair value of $2.8 billion and tower obligations related to amounts owed to CCI under the leaseback of $1.1 billion. Additionally, we recognized $1.7 billion in Other long-term liabilities associated with contract terms that are unfavorable to current market rates, which includes unfavorable terms associated with the fixed-price purchase option in 2037. We recognize interest expense on the tower obligations at a rate of approximately 6% using the effective interest method. The tower obligations are increased by interest expense and amortized through contractual leaseback payments made by us to CCI. The tower assets are reported in Property and equipment, net in our Condensed Consolidated Balance Sheets and are depreciated to their estimated residual values over the expected useful life of the tower, which is 20 years. The following table summarizes the balances associated with both of the tower arrangements in the Condensed Consolidated Balance Sheets: (in millions) March 31, December 31, Property and equipment, net $ 2,715 $ 2,838 Tower obligations 2,974 3,028 Other long-term liabilities 1,712 1,712 Future minimum payments related to the tower obligations are approximately $399 million for the year ending March 31, 2022, $690 million in total for the years ending March 31, 2023 and 2024, $601 million in total for years ending March 31, 2025 and 2026, and $549 million in total for years thereafter. We are contingently liable for future ground lease payments through the remaining term of the CCI Lease Sites and the Master Lease Sites. These contingent obligations are not included in Operating lease liabilities as any amount due is contractually owed by CCI based on the subleasing arrangement. Under the arrangement, we remain primarily liable for ground lease payments on |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Note 9 – Revenue from Contracts with Customers Disaggregation of Revenue We provide wireless communications services to three primary categories of customers: • Postpaid customers generally include customers who are qualified to pay after receiving wireless communications services utilizing phones, home internet, wearables, DIGITS (a service that allows our customers to use multiple mobile numbers on any compatible smartphone or device with internet connection), or other connected devices which includes tablets and SyncUP products. • Prepaid customers generally include customers who pay for wireless communications services in advance; and • Wholesale customers include Machine-to-Machine and Mobile Virtual Network Operator customers that operate on our network but are managed by wholesale partners. Postpaid service revenues, including postpaid phone revenues and postpaid other revenues, were as follows: Three Months Ended March 31, (in millions) 2021 2020 Postpaid service revenues Postpaid phone revenues $ 9,483 $ 5,577 Postpaid other revenues 820 310 Total postpaid service revenues $ 10,303 $ 5,887 We operate as a single operating segment. The balances presented within each revenue line item in our Condensed Consolidated Statements of Comprehensive Income represent categories of revenue from contracts with customers disaggregated by type of product and service. Service revenues also include revenues earned for providing value added services to customers, such as device insurance services. Revenue generated from the lease of mobile communication devices is included within Equipment revenues in our Condensed Consolidated Statements of Comprehensive Income. We provide wireline communication services to domestic and international customers. Wireline service revenues of $197 million for the three months ended March 31, 2021 are presented in Roaming and other service revenues in our Condensed Consolidated Statements of Comprehensive Income. Equipment revenues from the lease of mobile communication devices were as follows: Three Months Ended March 31, (in millions) 2021 2020 Equipment revenues from the lease of mobile communication devices $ 1,041 $ 165 Contract Balances The contract asset and contract liability balances from contracts with customers as of December 31, 2020 and March 31, 2021, were as follows: (in millions) Contract Assets Contract Liabilities Balance as of December 31, 2020 $ 278 $ 824 Balance as of March 31, 2021 275 775 Change $ (3) $ (49) Contract assets primarily represent revenue recognized for equipment sales with promotional bill credits offered to customers that are paid over time and are contingent on the customer maintaining a service contract. The change in the contract asset balance includes customer activity related to new promotions, offset by billings on existing contracts and impairment which is recognized as bad debt expense. The current portion of our Contract assets of approximately $205 million and $204 million as of March 31, 2021 and December 31, 2020, respectively, was included in Other current assets in our Condensed Consolidated Balance Sheets. Contract liabilities are recorded when fees are collected, or we have an unconditional right to consideration (a receivable) in advance of delivery of goods or services. Changes in contract liabilities are primarily related to the activity of prepaid customers. Contract liabilities are primarily included in Deferred revenue in our Condensed Consolidated Balance Sheets. Revenues for the three months ended March 31, 2021 and 2020, include the following: Three Months Ended March 31, (in millions) 2021 2020 Amounts included in the beginning of year contract liability balance $ 683 $ 528 Remaining Performance Obligations As of March 31, 2021, the aggregate amount of transaction price allocated to remaining service performance obligations for postpaid contracts with subsidized devices and promotional bill credits that result in an extended service contract is $1.3 billion. We expect to recognize revenue as service is provided on these postpaid contracts over an extended contract term of 24 months. As of March 31, 2021, the aggregate amount of transaction price allocated to remaining service and lease performance obligations associated with operating leases was $1.3 billion and $766 million, respectively. We expect to recognize this revenue as service is provided over the lease contract term of 18 months. Information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less have been excluded from the above, which primarily consists of monthly service contracts. Certain of our wholesale, roaming and other service contracts include variable consideration based on usage. This variable consideration has been excluded from the disclosure of remaining performance obligations. As of March 31, 2021, the aggregate amount of the contractual minimum consideration for wholesale, roaming and other service contracts is $1.0 billion, $1.2 billion and $945 million for 2021, 2022, and 2023 and beyond, respectively. These contracts have a remaining duration ranging from less than one year to nine years. Contract Costs The total balance of deferred incremental costs to obtain contracts was $1.2 billion and $1.1 billion as of March 31, 2021 and December 31, 2020, respectively, and is included in Other assets in our Condensed Consolidated Balance Sheets. Deferred contract costs incurred to obtain postpaid service contracts are amortized over a period of 24 months. The amortization period is monitored to reflect any significant change in assumptions. Amortization of deferred contract costs is included in Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income and was $248 million and $205 million for the three months ended March 31, 2021 and 2020, respectively. The deferred contract cost asset is assessed for impairment on a periodic basis. There were no impairment losses recognized on deferred contract cost assets for the three months ended March 31, 2021 and 2020. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 10 – Earnings Per Share The computation of basic and diluted earnings per share was as follows: Three Months Ended March 31, (in millions, except shares and per share amounts) 2021 2020 Net income $ 933 $ 951 Weighted average shares outstanding - basic 1,243,520,026 858,148,284 Effect of dilutive securities: Outstanding stock options and unvested stock awards 9,263,538 7,850,248 Weighted average shares outstanding - diluted 1,252,783,564 865,998,532 Earnings per share - basic $ 0.75 $ 1.11 Earnings per share - diluted $ 0.74 $ 1.10 Potentially dilutive securities: Outstanding stock options and unvested stock awards 6 1,807,812 SoftBank contingent consideration (1) 48,751,557 — (1) Represents the weighted average SoftBank Specified Shares outstanding from January 1, 2021, through March 31, 2021. No SoftBank Specified Shares were outstanding during the three months ended March 31, 2020. As of March 31, 2021, we had authorized 100 million shares of preferred stock, with a par value of $0.00001 per share. There was no preferred stock outstanding as of March 31, 2021 and 2020. Potentially dilutive securities were not included in the computation of diluted earnings per share if to do so would have been anti-dilutive or if there was a net loss for the period. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 – Commitments and Contingencies Purchase Commitments We have commitments for non-dedicated transportation lines with varying expiration terms that generally extend through 2029. In addition, we have commitments to purchase wireless devices, network services, equipment, software, marketing sponsorship agreements and other items in the ordinary course of business, with various terms through 2043. Our purchase commitments are approximately $3.9 billion for the year ending March 31, 2022, $4.3 billion in total for the years ending March 31, 2023 and 2024, $2.2 billion in total for the years ending March 31, 2025 and 2026 and $1.6 billion in total for the years thereafter. These amounts are not reflective of our entire anticipated purchases under the related agreements but are determined based on the non-cancelable quantities or termination amounts to which we are contractually obligated. Spectrum Leases In connection with the Merger, we assumed certain spectrum lease contracts from Sprint that include service obligations to the lessors. Certain of the spectrum leases provide for minimum lease payments, additional charges, renewal options and escalation clauses. Leased spectrum agreements have varying expiration terms that generally extend through 2050. We expect that all renewal periods in our spectrum leases will be exercised by us. Our spectrum lease and service credit commitments, including renewal periods, are approximately $340 million for the year ending March 31, 2022, $662 million in total for the years ending March 31, 2023 and 2024, $579 million in total for the years ending March 31, 2025 and 2026 and $5.0 billion in total for the years thereafter. We accrue a monthly obligation for the services and equipment based on the total estimated available service credits divided by the term of the lease. The obligation is reduced by services provided and as actual invoices are presented and paid to the lessors. The maximum remaining service commitment on March 31, 2021 was $91 million and is expected to be incurred over the term of the related lease agreements, which generally range from 15 to 30 years. Merger Commitments In connection with the regulatory proceedings and approvals of the Transactions, we have commitments and other obligations to various state and federal agencies and certain nongovernmental organizations, including pursuant to the Consent Decree agreed to by us, DT, Sprint, SoftBank and DISH Network Corporation (“DISH”) and entered by the U.S. District Court for the District of Columbia, and the FCC’s memorandum opinion and order approving our applications for approval of the Merger. These commitments and obligations include, among other things, extensive 5G network build-out commitments, obligations to deliver high-speed wireless services to the vast majority of Americans, including Americans residing in rural areas, and the marketing of an in-home broadband product where spectrum capacity is available. Other commitments relate to national security, pricing, service, employment and support of diversity initiatives. Many of the commitments specify time frames for compliance. Failure to fulfill our obligations and commitments in a timely manner could result in substantial fines, penalties, or other legal and administrative actions. We expect that our monetary commitments associated with these matters are approximately $24 million for the year ending March 31, 2022, $37 million in total for the years ending March 31, 2023 and 2024 and $11 million in total for the years ending March 31, 2025 and 2026. These amounts do not represent our entire anticipated costs to achieve specified network coverage and performance requirements, employment targets or commitments to provide access to affordable rate plans, but represent only those amounts for which we are required to make a specified payment in connection with our commitments or settlements. Contingencies and Litigation Litigation Matters We are involved in various lawsuits and disputes, claims, government agency investigations and enforcement actions, and other proceedings (“Litigation Matters”) that arise in the ordinary course of business, which include claims of patent infringement (most of which are asserted by non-practicing entities primarily seeking monetary damages), class actions, and proceedings to enforce FCC rules and regulations. Those Litigation Matters are at various stages, and some of them may proceed to trial, arbitration, hearing, or other adjudication that could result in fines, penalties, or awards of monetary or injunctive relief in the coming 12 months if they are not otherwise resolved. We have established an accrual with respect to certain of these matters, where appropriate, which is reflected in the condensed consolidated financial statements but that is not considered to be, individually or in the aggregate, material. An accrual is established when we believe it is both probable that a loss has been incurred and an amount can be reasonably estimated. For other matters, where we have not determined that a loss is probable or because the amount of loss cannot be reasonably estimated, we have not recorded an accrual due to various factors typical in contested proceedings, including, but not limited to, uncertainty concerning legal theories and their resolution by courts or regulators, uncertain damage theories and demands, and a less than fully developed factual record. For Litigation Matters which may result in a contingent gain, we recognize such gains in the condensed consolidated financial statements when the gain is realized or realizable. We do not expect that the ultimate resolution of these Litigation Matters, individually or in the aggregate, will have a material adverse effect on our financial position, but we note that an unfavorable outcome of some or all of the specific matters identified below could have a material adverse impact on results of operations or cash flows for a particular period. This assessment is based on our current understanding of relevant facts and circumstances. As such, our view of these matters is subject to inherent uncertainties and may change in the future. On February 28, 2020, we received a Notice of Apparent Liability for Forfeiture and Admonishment from the FCC, which proposed a penalty against us for allegedly violating section 222 of the Communications Act and the FCC’s regulations governing the privacy of customer information. In the first quarter of 2020, we recorded an accrual for an estimated payment amount. We maintained the accrual as of March 31, 2021, which was included in Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets. On April 1, 2020, in connection with the closing of the Merger, we assumed the contingencies and litigation matters of Sprint. Those matters include a wide variety of disputes, claims, government agency investigations and enforcement actions, and other proceedings. These matters include, among other things, certain ongoing FCC and state government agency investigations into Sprint’s Lifeline program. In September 2019, Sprint notified the FCC that it had claimed monthly subsidies for serving subscribers even though these subscribers may not have met usage requirements under Sprint's usage policy for the Lifeline program, due to an inadvertent coding issue in the system used to identify qualifying subscriber usage that occurred in July 2017 while the system was being updated. Sprint has made a number of payments to reimburse the federal government and certain states for excess subsidy payments. Resolution of these matters could require making additional reimbursements and paying additional fines and penalties. We note that pursuant to Amendment No. 2 to the Business Combination Agreement, SoftBank agreed to indemnify us against certain specified matters and losses, including those relating to Lifeline matters. Resolution of these matters could require making additional reimbursements and paying additional fines and penalties, which we do not expect to have a significant impact on our financial results. We expect that any additional liabilities related to these indemnified matters would be indemnified and reimbursed by SoftBank. See Note 2 - Business Combination for further information. |
Restructuring Costs
Restructuring Costs | 3 Months Ended |
Mar. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Costs | Note 12 – Restructuring Costs Upon close of the Merger, we began implementing restructuring initiatives to realize cost efficiencies and reduce redundancies. The major activities associated with the restructuring initiatives to date include contract termination costs associated with the rationalization of retail stores, distribution channels, duplicative backhaul services and other agreements, severance costs associated with the integration of redundant processes and functions and the decommissioning of network infrastructure including cell sites and equipment to achieve synergies in network costs. The following table summarizes the expenses incurred in connection with our restructuring initiatives: (in millions) Three Months Ended March 31, 2021 Plan to Date Contract termination costs $ 6 $ 184 Severance costs 16 401 Network decommissioning 12 509 Total restructuring plan expenses $ 34 $ 1,094 The expenses associated with the restructuring initiatives are included in Costs of services and Selling, general and administrative in our Condensed Consolidated Statements of Comprehensive Income. No expenses were incurred related to our restructuring initiatives for the three months ended March 31, 2020. Our restructuring initiatives also include the acceleration or termination of certain of our operating and financing leases for cell sites, switch sites, retail stores, network equipment and office facilities. Incremental expenses associated with accelerating amortization of the right-of-use assets on lease contracts were $123 million for the three months ended March 31, 2021 and are included within Costs of services and Selling, general and administrative in our Condensed Consolidated Statements of Comprehensive Income. No restructuring expenses were incurred related to the acceleration or termination of leases for the three months ended March 31, 2020. The changes in the liabilities associated with our restructuring initiatives, including expenses incurred and cash payments, are as follows: (in millions) December 31, Expenses Incurred Cash Payments Adjustments for Non-Cash Items (1) March 31, Contract termination costs $ 81 $ 6 $ (44) $ — $ 43 Severance costs 52 16 (38) (5) 25 Network decommissioning 30 12 (28) (2) 12 Total $ 163 $ 34 $ (110) $ (7) $ 80 (1) Non-cash items consists of non-cash stock-based compensation included within Severance costs and the write-off of assets within Network decommissioning. The liabilities accrued in connection with our restructuring initiatives are presented in Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets. Our restructuring activities are expected to occur over the next three years with substantially all costs incurred by the end of fiscal year 2023. We are evaluating additional restructuring initiatives, which are dependent on consultations and negotiation with certain counterparties and the expected impact on our business operations, which could affect the amount or timing of the restructuring costs and related payments. |
Additional Financial Informatio
Additional Financial Information | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Financial Statement Elements [Abstract] | |
Additional Financial Information | Note 13 – Additional Financial Information Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities are summarized as follows: (in millions) March 31, December 31, Accounts payable $ 4,559 $ 5,564 Payroll and related benefits 785 1,163 Property and other taxes, including payroll 1,540 1,540 Interest 777 771 Commissions 327 399 Toll and interconnect 233 217 Advertising 109 135 Other 382 407 Accounts payable and accrued liabilities $ 8,712 $ 10,196 Book overdrafts included in accounts payable and accrued liabilities were $285 million and $628 million as of March 31, 2021 and December 31, 2020, respectively. Supplemental Consolidated Statements of Cash Flows Information The following table summarizes T-Mobile’s supplemental cash flow information: Three Months Ended March 31, (in millions) 2021 2020 Interest payments, net of amounts capitalized $ 945 $ 341 Operating lease payments 1,651 875 Income tax payments 22 24 Non-cash investing and financing activities Non-cash beneficial interest obtained in exchange for securitized receivables 1,381 1,613 Change in accounts payable and accrued liabilities for purchases of property and equipment (173) (301) Leased devices transferred from inventory to property and equipment 485 309 Returned leased devices transferred from property and equipment to inventory (445) (59) Operating lease right-of-use assets obtained in exchange for lease obligations 911 555 Financing lease right-of-use assets obtained in exchange for lease obligations 109 178 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Consolidation | The unaudited condensed consolidated financial statements of T-Mobile US, Inc. (“T-Mobile,” “we,” “our,” “us” or the “Company”) include all adjustments of a normal recurring nature necessary for the fair presentation of the results for the interim periods presented. The results for the interim periods are not necessarily indicative of those for the full year. The condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. The condensed consolidated financial statements include the balances and results of operations of T-Mobile and our consolidated subsidiaries. We consolidate majority-owned subsidiaries over which we exercise control, as well as variable interest entities (“VIEs”) where we are deemed to be the primary beneficiary and VIEs which cannot be deconsolidated, such as those related to our obligations to pay for the management and operation of certain of our wireless communications tower sites. Intercompany transactions and balances have been eliminated in consolidation. |
Basis of Accounting | The preparation of financial statements in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions that affect the financial statements and accompanying notes. |
Use of Estimates | Estimates are based on historical experience, where applicable, and other assumptions that management believes are reasonable under the circumstances, including but not limited to, the valuation of assets acquired and liabilities assumed through the merger (the “Merger”) with Sprint Corporation (“Sprint”). These estimates are inherently subject to judgment and actual results could differ from those estimates. |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted Reference Rate Reform In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The standard provides temporary optional expedients and allows for certain exceptions to applying existing GAAP for contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued as a result of reference rate reform. The standard is available for adoption through December 31, 2022. We are currently evaluating the impact this standard will have, including optional expedients, on our condensed consolidated financial statements. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, or are not expected to have, a significant impact on our present or future condensed consolidated financial statements. |
Receivable | We maintain an allowance for expected credit losses that assesses the lifetime credit losses that we expect to incur related to our receivable portfolio segments. Each period, management assesses the appropriateness of the level of allowance for credit losses by considering credit risk inherent within each portfolio segment as of period end. We consider a receivable past due when a customer has not paid us by the contractually specified payment due date. Account balances are written off against the allowance for credit losses if collection efforts are unsuccessful and the receivable balance is deemed uncollectible, based on factors such as customer credit ratings as well as the length of time the amounts are past due. |
Business Combination (Tables)
Business Combination (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of Components of Consideration Transferred | The acquisition-date fair value of consideration transferred in the Merger totaled $40.8 billion, comprised of the following: (in millions) April 1, 2020 Fair value of T-Mobile common stock issued to Sprint stockholders (1) $ 31,328 Fair value of T-Mobile replacement equity awards attributable to pre-combination service (2) 323 Repayment of Sprint’s debt (including accrued interest and prepayment penalties) (3) 7,396 Value of contingent consideration (4) 1,882 Payment received from selling stockholder (5) (102) Total consideration exchanged $ 40,827 (1) Represents the fair value of T-Mobile common stock issued to Sprint stockholders pursuant to the Business Combination Agreement, less shares surrendered by SoftBank pursuant to the Letter Agreement. The fair value is based on 373,396,310 shares of Sprint common stock issued and outstanding as of March 31, 2020, an exchange ratio of 0.10256 shares of T-Mobile common stock per share of Sprint common stock, less 48,751,557 T-Mobile shares surrendered by SoftBank which are treated as contingent consideration, and the closing price per share of T-Mobile common stock on NASDAQ on March 31, 2020, of $83.90, as shares were transferred to Sprint stockholders prior to the opening of markets on April 1, 2020. (2) Equity-based awards held by Sprint employees prior to the acquisition date have been replaced with T-Mobile equity-based awards. The portion of the equity-based awards that relates to services performed by the employee prior to the acquisition date is included within consideration transferred, and includes stock options, restricted stock units and performance-based restricted stock units. (3) Represents the cash consideration paid concurrent with the close of the Merger to retire certain Sprint debt, as required by change in control provisions of the debt, plus interest and prepayment penalties. (4) Represents the fair value of the SoftBank Specified Shares Amount contingent consideration that may be issued as set forth in the Letter Agreement. (5) Represents receipt of a cash payment from SoftBank for certain expenses associated with the Merger. |
Schedule of Amounts Recognized as of Acquisition Date | The following table summarizes the fair values for each major class of assets acquired and liabilities assumed at the acquisition date. We retained the services of certified valuation specialists to assist with assigning values to certain acquired assets and assumed liabilities. (in millions) April 1, 2020 Cash and cash equivalents $ 2,084 Accounts receivable 1,775 Equipment installment plan receivables 1,088 Inventory 658 Prepaid expenses 140 Assets held for sale 1,908 Other current assets 637 Property and equipment 18,435 Operating lease right-of-use assets 6,583 Financing lease right-of-use assets 291 Goodwill 9,423 Spectrum licenses 45,400 Other intangible assets 6,280 Equipment installment plan receivables due after one year, net 247 Other assets (1) 540 Total assets acquired 95,489 Accounts payable and accrued liabilities 5,015 Short-term debt 2,760 Deferred revenue 508 Short-term operating lease liabilities 1,818 Short-term financing lease liabilities 8 Liabilities held for sale 475 Other current liabilities 681 Long-term debt 29,037 Tower obligations 950 Deferred tax liabilities 3,478 Operating lease liabilities 5,615 Financing lease liabilities 12 Other long-term liabilities 4,305 Total liabilities assumed 54,662 Total consideration transferred $ 40,827 (1) Included in Other assets acquired is $80 million in restricted cash. |
Schedule of Pro Forma Information | The following unaudited pro forma financial information gives effect to the Transactions as if they had been completed on January 1, 2019. The unaudited pro forma information was prepared in accordance with the requirements of ASC 805: Business Combinations, which is a different basis than pro forma information prepared under Article 11 of Regulation S-X (“Article 11”). As such, they are not directly comparable with historical results for stand-alone T-Mobile prior to April 1, 2020, historical results for T-Mobile from April 1, 2020 that reflect the Transactions and are inclusive of the results and operations of Sprint, nor our previously provided pro forma financials prepared in accordance with Article 11. The pro forma results for the three months ended March 31, 2020 include the impact of several significant nonrecurring pro forma adjustments to previously reported operating results. The pro forma adjustments are based on historically reported transactions by the respective companies. The pro forma results do not include any anticipated synergies or other expected benefits of the acquisition. (in millions) Three Months Ended March 31, 2020 Total revenues $ 17,408 Income from continuing operations 1,111 Income from discontinued operations, net of tax 357 Net income 1,468 |
Receivables and Expected Cred_2
Receivables and Expected Credit Losses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Schedule of Equipment Installment Plan Receivables | The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses: (in millions) March 31, December 31, EIP receivables, gross $ 6,698 $ 6,213 Unamortized imputed discount (356) (325) EIP receivables, net of unamortized imputed discount 6,342 5,888 Allowance for credit losses (280) (280) EIP receivables, net of allowance for credit losses and imputed discount $ 6,062 $ 5,608 Classified on the balance sheet as: Equipment installment plan receivables, net of allowance for credit losses and imputed discount $ 3,841 $ 3,577 Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount 2,221 2,031 EIP receivables, net of allowance for credit losses and imputed discount $ 6,062 $ 5,608 |
Schedule of Equipment Installment Plan Receivables by Credit Category | The following table presents the amortized cost of our EIP receivables by delinquency status, customer credit class, and year of origination as of March 31, 2021: Originated in 2021 Originated in 2020 Originated prior to 2020 Total EIP Receivables, net of (in millions) Prime Subprime Prime Subprime Prime Subprime Prime Subprime Grand total Current - 30 days past due $ 1,180 $ 1,005 $ 1,999 $ 1,455 $ 383 $ 225 $ 3,562 $ 2,685 $ 6,247 31 - 60 days past due 5 5 13 20 3 5 21 30 51 61 - 90 days past due — 1 5 10 2 2 7 13 20 More than 90 days past due — — 5 11 2 6 7 17 24 EIP receivables, net of unamortized imputed discount $ 1,185 $ 1,011 $ 2,022 $ 1,496 $ 390 $ 238 $ 3,597 $ 2,745 $ 6,342 |
Schedule of Unamortized Imputed Discount and Allowance for Credit Losses for Equipment Installment Plan Receivables | Activity for the three months ended March 31, 2021 and 2020, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows: March 31, 2021 March 31, 2020 (in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total Allowance for credit losses and imputed discount, beginning of period $ 194 $ 605 $ 799 $ 61 $ 399 $ 460 Beginning balance adjustment due to implementation of the new credit loss standard — — — — 91 91 Bad debt expense 28 54 82 42 71 113 Write-offs, net of recoveries (79) (54) (133) (34) (61) (95) Change in imputed discount on short-term and long-term EIP receivables N/A 66 66 N/A 5 5 Impact on the imputed discount from sales of EIP receivables N/A (35) (35) N/A (36) (36) Allowance for credit losses and imputed discount, end of period $ 143 $ 636 $ 779 $ 69 $ 469 $ 538 |
Sales of Certain Receivables (T
Sales of Certain Receivables (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Transfers and Servicing [Abstract] | |
Schedule of variable interest entities - EIP | The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the EIP BRE: (in millions) March 31, December 31, Other current assets $ 390 $ 388 Other assets 113 120 Other long-term liabilities 4 4 |
Schedule of Variable Interest Entities | The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the Service BRE: (in millions) March 31, December 31, Other current assets $ 268 $ 378 Other current liabilities 248 357 |
Schedule of Factoring Arrangement | The following table summarizes the impact of the sale of certain service receivables and EIP receivables in our Condensed Consolidated Balance Sheets: (in millions) March 31, December 31, Derecognized net service receivables and EIP receivables $ 2,537 $ 2,528 Other current assets 658 766 of which, deferred purchase price 656 764 Other long-term assets 113 120 of which, deferred purchase price 113 120 Other current liabilities 248 357 Other long-term liabilities 4 4 Net cash proceeds since inception 1,737 1,715 Of which: Change in net cash proceeds during the year-to-date period 22 (229) Net cash proceeds funded by reinvested collections 1,715 1,944 |
Goodwill, Spectrum License Tr_2
Goodwill, Spectrum License Transactions and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill for the three months ended March 31, 2021 and year ended December 31, 2020, are as follows: (in millions) Goodwill Historical goodwill, net of accumulated impairment losses of $10,766 $ 1,930 Goodwill from acquisitions in 2020 9,405 Layer3 goodwill impairment (218) Balance as of December 31, 2020 11,117 Purchase price adjustment of goodwill from acquisitions in 2020 22 Goodwill from acquisitions in 2021 19 Balance as of March 31, 2021 $ 11,158 Accumulated impairment losses at March 31, 2021 $ (10,984) |
Schedule of Fair Value of Intangible Assets Acquired in Merger | The following table summarizes the fair value of the intangible assets acquired in the Merger: Weighted Average Useful Life (in years) Fair Value as of April 1, 2020 Spectrum licenses Indefinite-lived $ 45,400 Tradenames (1) 2 years 207 Customer relationships 8 years 4,900 Favorable spectrum leases 18 years 745 Other intangible assets 7 years 428 Total intangible assets acquired $ 51,680 (1) Tradenames include the Sprint brand. |
Schedule of Spectrum Licenses | The following table summarizes our spectrum license activity for the three months ended March 31, 2021: (in millions) 2021 Spectrum licenses, beginning of year $ 82,828 Spectrum license acquisitions 72 Costs to clear spectrum 1 Spectrum licenses, end of period $ 82,901 |
Schedule of Other Intangible Assets | The components of Other intangible assets were as follows: Useful Lives March 31, 2021 December 31, 2020 (in millions) Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Customer relationships Up to 8 years $ 4,903 $ (1,153) $ 3,750 $ 4,900 $ (865) $ 4,035 Tradenames and patents Up to 19 years 603 (461) 142 598 (412) 186 Favorable spectrum leases Up to 27 years 741 (44) 697 790 (35) 755 Other Up to 10 years 377 (74) 303 377 (55) 322 Other intangible assets $ 6,624 $ (1,732) $ 4,892 $ 6,665 $ (1,367) $ 5,298 |
Schedule of Estimated Aggregate Future Amortization Expense | The estimated aggregate future amortization expense for intangible assets subject to amortization are summarized below: (in millions) Estimated Future Amortization Twelve Months Ending March 31, 2022 $ 1,154 2023 941 2024 785 2025 627 2026 468 Thereafter 917 Total $ 4,892 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Values and Fair Values of Long-term Debt | The carrying amounts and fair values of our short-term and long-term debt included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy March 31, 2021 December 31, 2020 (in millions) Carrying Amount (1) Fair Value (1) Carrying Amount (1) Fair Value (1) Liabilities: Senior Unsecured Notes to third parties 1 $ 34,648 $ 36,563 $ 29,966 $ 32,450 Senior Notes to affiliates 2 4,721 4,941 4,716 4,991 Senior Secured Notes to third parties 1 35,983 37,821 36,204 40,519 (1) Excludes $186 million and $240 million as of March 31, 2021 and December 31, 2020, respectively, in vendor financing arrangements and other debt as the carrying values approximate fair value primarily due to the short-term maturities of these instruments. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table sets forth the debt balances and activity as of, and for the three months ended, March 31, 2021 : (in millions) December 31, Proceeds from Issuances and Borrowings (1) Note Redemptions (1) Repayments Reclassifications (1) Other (2) March 31, Short-term debt $ 4,579 $ — $ — $ (274) $ 144 $ (26) $ 4,423 Long-term debt 61,830 6,758 (1,964) — (144) (85) 66,395 Total debt to third parties 66,409 6,758 (1,964) (274) — (111) 70,818 Long-term debt to affiliates 4,716 — — — — 5 4,721 Total debt $ 71,125 $ 6,758 $ (1,964) $ (274) $ — $ (106) $ 75,539 (1) Issuances and borrowings, note redemptions, and reclassifications are recorded net of related issuance costs, discounts and premiums. (2) Other includes the amortization of premiums, discounts, debt issuance costs and consent fees. Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.3% and 5.2% for the three months ended March 31, 2021 and 2020, respectively, on weighted average debt outstanding of $73.7 billion and $25.0 billion for the three months ended March 31, 2021 and 2020, respectively. The weighted average debt outstanding was calculated by applying an average of the monthly ending balances of total short-term and long-term debt and short-term and long-term debt to affiliates, net of unamortized premiums, discounts, debt issuance costs and consent fees. Issuances and Borrowings During the three months ended March 31, 2021, we issued the following Senior Notes: (in millions) Principal Issuances Issuance Costs Net Proceeds from Issuance of Long-Term Debt Issue Date 2.250% Senior Notes due 2026 $ 1,000 $ (7) $ 993 January 14, 2021 2.625% Senior Notes due 2029 1,000 (7) 993 January 14, 2021 2.875% Senior Notes due 2031 1,000 (7) 993 January 14, 2021 2.625% Senior Notes due 2026 1,200 (7) 1,193 March 23, 2021 3.375% Senior Notes due 2029 1,250 (7) 1,243 March 23, 2021 3.500% Senior Notes due 2031 1,350 (7) 1,343 March 23, 2021 Total of Senior Notes issued $ 6,800 $ (42) $ 6,758 |
Tower Obligations (Tables)
Tower Obligations (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Summary of Impacts to Consolidated Balance Sheets | The following table summarizes the balances associated with both of the tower arrangements in the Condensed Consolidated Balance Sheets: (in millions) March 31, December 31, Property and equipment, net $ 2,715 $ 2,838 Tower obligations 2,974 3,028 Other long-term liabilities 1,712 1,712 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Postpaid service revenues, including postpaid phone revenues and postpaid other revenues, were as follows: Three Months Ended March 31, (in millions) 2021 2020 Postpaid service revenues Postpaid phone revenues $ 9,483 $ 5,577 Postpaid other revenues 820 310 Total postpaid service revenues $ 10,303 $ 5,887 Equipment revenues from the lease of mobile communication devices were as follows: Three Months Ended March 31, (in millions) 2021 2020 Equipment revenues from the lease of mobile communication devices $ 1,041 $ 165 |
Schedule of Contract Liability and Receivable Balances | The contract asset and contract liability balances from contracts with customers as of December 31, 2020 and March 31, 2021, were as follows: (in millions) Contract Assets Contract Liabilities Balance as of December 31, 2020 $ 278 $ 824 Balance as of March 31, 2021 275 775 Change $ (3) $ (49) Revenues for the three months ended March 31, 2021 and 2020, include the following: Three Months Ended March 31, (in millions) 2021 2020 Amounts included in the beginning of year contract liability balance $ 683 $ 528 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The computation of basic and diluted earnings per share was as follows: Three Months Ended March 31, (in millions, except shares and per share amounts) 2021 2020 Net income $ 933 $ 951 Weighted average shares outstanding - basic 1,243,520,026 858,148,284 Effect of dilutive securities: Outstanding stock options and unvested stock awards 9,263,538 7,850,248 Weighted average shares outstanding - diluted 1,252,783,564 865,998,532 Earnings per share - basic $ 0.75 $ 1.11 Earnings per share - diluted $ 0.74 $ 1.10 Potentially dilutive securities: Outstanding stock options and unvested stock awards 6 1,807,812 SoftBank contingent consideration (1) 48,751,557 — (1) Represents the weighted average SoftBank Specified Shares outstanding from January 1, 2021, through March 31, 2021. No SoftBank Specified Shares were outstanding during the three months ended March 31, 2020. |
Restructuring Costs (Tables)
Restructuring Costs (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Plan Expenses Incurred | The following table summarizes the expenses incurred in connection with our restructuring initiatives: (in millions) Three Months Ended March 31, 2021 Plan to Date Contract termination costs $ 6 $ 184 Severance costs 16 401 Network decommissioning 12 509 Total restructuring plan expenses $ 34 $ 1,094 |
Activity Related to Expenses Incurred and Cash Payments Made | The changes in the liabilities associated with our restructuring initiatives, including expenses incurred and cash payments, are as follows: (in millions) December 31, Expenses Incurred Cash Payments Adjustments for Non-Cash Items (1) March 31, Contract termination costs $ 81 $ 6 $ (44) $ — $ 43 Severance costs 52 16 (38) (5) 25 Network decommissioning 30 12 (28) (2) 12 Total $ 163 $ 34 $ (110) $ (7) $ 80 |
Additional Financial Informat_2
Additional Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Financial Statement Elements [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued liabilities are summarized as follows: (in millions) March 31, December 31, Accounts payable $ 4,559 $ 5,564 Payroll and related benefits 785 1,163 Property and other taxes, including payroll 1,540 1,540 Interest 777 771 Commissions 327 399 Toll and interconnect 233 217 Advertising 109 135 Other 382 407 Accounts payable and accrued liabilities $ 8,712 $ 10,196 |
Schedule of Cash Flow, Supplemental Disclosures | The following table summarizes T-Mobile’s supplemental cash flow information: Three Months Ended March 31, (in millions) 2021 2020 Interest payments, net of amounts capitalized $ 945 $ 341 Operating lease payments 1,651 875 Income tax payments 22 24 Non-cash investing and financing activities Non-cash beneficial interest obtained in exchange for securitized receivables 1,381 1,613 Change in accounts payable and accrued liabilities for purchases of property and equipment (173) (301) Leased devices transferred from inventory to property and equipment 485 309 Returned leased devices transferred from property and equipment to inventory (445) (59) Operating lease right-of-use assets obtained in exchange for lease obligations 911 555 Financing lease right-of-use assets obtained in exchange for lease obligations 109 178 |
Business Combination - Narrativ
Business Combination - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 01, 2020 | Feb. 20, 2020 | Sep. 30, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Jan. 01, 2019 |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 11,158 | $ 11,117 | |||||
Sprint | |||||||
Business Acquisition [Line Items] | |||||||
Exchange ratio (in shares) | 9.75 | ||||||
Exchange ratio (in shares) | 0.10256 | ||||||
Stock issued (in shares) | 373,396,310 | ||||||
Value of common stock provided in exchange for acquiree common stock | $ 31,328 | ||||||
Fully-diluted shares of combined company held by public stockholders (percent) | 31.70% | ||||||
Value of contingent consideration | 1,882 | ||||||
Contingent consideration, high end of range | 7,300 | ||||||
Goodwill | 9,423 | ||||||
Goodwill expected to be tax deductible | 0 | ||||||
Spectrum licenses | 45,400 | ||||||
Deferred tax assets | $ 851 | ||||||
Uncertain tax benefit reserves | 660 | ||||||
Transaction costs | $ 13 | $ 38 | |||||
Transaction costs assumed to have occurred | $ 57 | ||||||
Total consideration exchanged | 40,827 | ||||||
Sprint | SoftBank | |||||||
Business Acquisition [Line Items] | |||||||
Value of contingent consideration | 200 | ||||||
Indemnification assets | 200 | ||||||
Sprint | Accounts Receivable | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of receivables acquired | 1,800 | ||||||
Gross amounts due | 1,800 | ||||||
Sprint | Equipment installment plan receivables, net of allowance for credit losses and imputed discount | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of receivables acquired | 1,300 | ||||||
Gross amounts due | 1,600 | ||||||
Sprint | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived, fair value | $ 4,900 | ||||||
Weighted average useful life | 8 years | ||||||
Sprint | Tradenames | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived, fair value | $ 207 | ||||||
Weighted average useful life | 2 years | ||||||
Sprint | Favorable lease (asset) | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived, fair value | $ 745 | ||||||
Weighted average useful life | 18 years | ||||||
Sprint | Unfavorable spectrum leases | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived, fair value | $ 125 | ||||||
Weighted average useful life | 19 years | ||||||
Sprint | SoftBank | |||||||
Business Acquisition [Line Items] | |||||||
Fully-diluted shares expected to be held immediately following merger (percent) | 24.70% | ||||||
Sprint | DT | |||||||
Business Acquisition [Line Items] | |||||||
Fully-diluted shares expected to be held immediately following merger (percent) | 43.60% | ||||||
Sprint | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Exchange ratio (in shares) | 11 | ||||||
Sprint | Common Stock | SoftBank | |||||||
Business Acquisition [Line Items] | |||||||
Aggregate surrendered (in shares) | 48,751,557 | ||||||
Exchange ratio (in shares) | 11.31 | ||||||
Volume-weighted average price (in USD per share) | $ 150 | ||||||
Number of shares issued if threshold not met (in shares) | 0 | ||||||
Shentel | Subsequent Event | Scenario, Forecast | |||||||
Business Acquisition [Line Items] | |||||||
Asset value | $ 2,100 | ||||||
Purchase price, percent of assets | 90.00% | ||||||
Total consideration exchanged | $ 1,900 |
Business Combination - Schedule
Business Combination - Schedule of Components of Consideration Transferred (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 01, 2020 | Feb. 20, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Business Acquisition [Line Items] | ||||
Payment received from selling shareholder | $ (29) | $ 0 | ||
Share price at closing (in USD per share) | $ 83.90 | |||
Sprint | ||||
Business Acquisition [Line Items] | ||||
Fair value of T-Mobile common stock issued to Sprint stockholders | $ 31,328 | |||
Fair value of T-Mobile replacement equity awards attributable to pre-combination service | 323 | |||
Repayments of Sprint's debt (including accrued interest, prepayment penalties) | 7,396 | |||
Value of contingent consideration | 1,882 | |||
Payment received from selling shareholder | (102) | |||
Total consideration exchanged | $ 40,827 | |||
Stock issued (in shares) | 373,396,310 | |||
Exchange ratio (in shares) | 0.10256 | |||
Sprint | SoftBank | Common Stock Outstanding | ||||
Business Acquisition [Line Items] | ||||
Aggregate surrendered (in shares) | 48,751,557 |
Business Combination - Schedu_2
Business Combination - Schedule of Amounts Recognized as of Acquisition Date (Details) - USD ($) $ in Millions | Apr. 01, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 11,158 | $ 11,117 | |
Sprint | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 2,084 | ||
Accounts receivable | 1,775 | ||
Equipment installment plan receivables | 1,088 | ||
Inventory | 658 | ||
Prepaid expenses | 140 | ||
Assets held for sale | 1,908 | ||
Other current assets | 637 | ||
Property and equipment | 18,435 | ||
Operating lease right-of-use assets | 6,583 | ||
Financing lease right-of-use assets | 291 | ||
Goodwill | 9,423 | ||
Spectrum licenses | 45,400 | ||
Other intangible assets | 6,280 | ||
Equipment installment plan receivables due after one year, net | 247 | ||
Other assets | 540 | ||
Total assets acquired | 95,489 | ||
Accounts payable and accrued liabilities | 5,015 | ||
Short-term debt | 2,760 | ||
Deferred revenue | 508 | ||
Short-term operating lease liabilities | 1,818 | ||
Short-term financing lease liabilities | 8 | ||
Liabilities held for sale | 475 | ||
Other current liabilities | 681 | ||
Long-term debt | 29,037 | ||
Tower obligations | 950 | ||
Deferred tax liabilities | 3,478 | ||
Operating lease liabilities | 5,615 | ||
Financing lease liabilities | 12 | ||
Other long-term liabilities | 4,305 | ||
Total liabilities assumed | 54,662 | ||
Total consideration exchanged | 40,827 | ||
Restricted cash | $ 80 |
Business Combination - Schedu_3
Business Combination - Schedule of Pro Forma Information (Details) - Sprint $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Business Acquisition [Line Items] | |
Total revenues | $ 17,408 |
Income from continuing operations | 1,111 |
Income from discontinued operations, net of tax | 357 |
Net income | $ 1,468 |
Receivables and Expected Cred_3
Receivables and Expected Credit Losses - EIP Receivables (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2021USD ($)classsegment | Dec. 31, 2020USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Portfolio segments | segment | 2 | |
Customer classes | class | 2 | |
Total EIP Receivables, net of unamortized imputed discounts | $ 6,698 | $ 6,213 |
Unamortized imputed discount | (356) | (325) |
EIP receivables, net of unamortized imputed discount | 6,342 | 5,888 |
Allowance for credit losses | (280) | (280) |
Equipment installment plan receivables, net | 6,062 | 5,608 |
Equipment installment plan receivables, net of allowance for credit losses and imputed discount | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | 3,841 | 3,577 |
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | $ 2,221 | $ 2,031 |
Receivables and Expected Cred_4
Receivables and Expected Credit Losses - Gross EIP Receivables by Credit Category (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total EIP Receivables, net of unamortized imputed discounts | $ 6,342 | $ 5,888 |
Prime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 1,185 | |
Originated in 2020 | 2,022 | |
Originated prior to 2020 | 390 | |
Total EIP Receivables, net of unamortized imputed discounts | 3,597 | |
Subprime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 1,011 | |
Originated in 2020 | 1,496 | |
Originated prior to 2020 | 238 | |
Total EIP Receivables, net of unamortized imputed discounts | 2,745 | |
Current - 30 days past due | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total EIP Receivables, net of unamortized imputed discounts | 6,247 | |
Current - 30 days past due | Prime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 1,180 | |
Originated in 2020 | 1,999 | |
Originated prior to 2020 | 383 | |
Total EIP Receivables, net of unamortized imputed discounts | 3,562 | |
Current - 30 days past due | Subprime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 1,005 | |
Originated in 2020 | 1,455 | |
Originated prior to 2020 | 225 | |
Total EIP Receivables, net of unamortized imputed discounts | 2,685 | |
31 - 60 days past due | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total EIP Receivables, net of unamortized imputed discounts | 51 | |
31 - 60 days past due | Prime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 5 | |
Originated in 2020 | 13 | |
Originated prior to 2020 | 3 | |
Total EIP Receivables, net of unamortized imputed discounts | 21 | |
31 - 60 days past due | Subprime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 5 | |
Originated in 2020 | 20 | |
Originated prior to 2020 | 5 | |
Total EIP Receivables, net of unamortized imputed discounts | 30 | |
61 - 90 days past due | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total EIP Receivables, net of unamortized imputed discounts | 20 | |
61 - 90 days past due | Prime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 0 | |
Originated in 2020 | 5 | |
Originated prior to 2020 | 2 | |
Total EIP Receivables, net of unamortized imputed discounts | 7 | |
61 - 90 days past due | Subprime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 1 | |
Originated in 2020 | 10 | |
Originated prior to 2020 | 2 | |
Total EIP Receivables, net of unamortized imputed discounts | 13 | |
More than 90 days past due | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total EIP Receivables, net of unamortized imputed discounts | 24 | |
More than 90 days past due | Prime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 0 | |
Originated in 2020 | 5 | |
Originated prior to 2020 | 2 | |
Total EIP Receivables, net of unamortized imputed discounts | 7 | |
More than 90 days past due | Subprime | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Originated in 2021 | 0 | |
Originated in 2020 | 11 | |
Originated prior to 2020 | 6 | |
Total EIP Receivables, net of unamortized imputed discounts | $ 17 |
Receivables and Expected Cred_5
Receivables and Expected Credit Losses - Unamortized Imputed Discount and Allowance for Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 799 | $ 460 | $ 460 |
Bad debt expense | 82 | 113 | |
Write-offs, net of recoveries | (133) | (95) | |
Change in imputed discount on short-term and long-term EIP receivables | 66 | 5 | |
Impact on the imputed discount from sales of EIP receivables | (35) | (36) | |
Allowance for credit losses and imputed discount, end of period | 779 | 538 | 799 |
Cumulative Effect, Period of Adoption, Adjustment | |||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | 0 | 91 | 91 |
Allowance for credit losses and imputed discount, end of period | 0 | ||
Accounts Receivable Allowance | |||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | 194 | 61 | 61 |
Bad debt expense | 28 | 42 | |
Write-offs, net of recoveries | (79) | (34) | |
Allowance for credit losses and imputed discount, end of period | 143 | 69 | 194 |
Accounts Receivable Allowance | Cumulative Effect, Period of Adoption, Adjustment | |||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 0 | 0 | 0 |
Allowance for credit losses and imputed discount, end of period | $ 0 | ||
EIP Receivables Allowance | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Weighted average effective imputed interest rate (percentage) | 6.70% | 6.70% | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 605 | 399 | $ 399 |
Bad debt expense | 54 | 71 | |
Write-offs, net of recoveries | (54) | (61) | |
Change in imputed discount on short-term and long-term EIP receivables | 66 | 5 | |
Impact on the imputed discount from sales of EIP receivables | (35) | (36) | |
Allowance for credit losses and imputed discount, end of period | 636 | 469 | 605 |
EIP Receivables Allowance | Cumulative Effect, Period of Adoption, Adjustment | |||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 0 | $ 91 | 91 |
Allowance for credit losses and imputed discount, end of period | $ 0 |
Sales of Certain Receivables -
Sales of Certain Receivables - Sales of EIP Receivables (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2015 |
Variable Interest Entity [Line Items] | |||
Other current assets | $ 1,770,000,000 | $ 2,496,000,000 | |
Other assets | 12,140,000,000 | 2,779,000,000 | |
EIP Securitization Arrangement | |||
Variable Interest Entity [Line Items] | |||
Revolving receivables facility, maximum borrowing capacity | 1,300,000,000 | 1,300,000,000 | $ 1,300,000,000 |
Other current assets | 390,000,000 | 388,000,000 | |
Other assets | 113,000,000 | 120,000,000 | |
Other long-term liabilities | $ 4,000,000 | $ 4,000,000 |
Sales of Certain Receivables _2
Sales of Certain Receivables - Sales of Service Receivables (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2014 |
Variable Interest Entity [Line Items] | |||
Other current assets | $ 1,770,000,000 | $ 2,496,000,000 | |
Other current liabilities | 769,000,000 | 810,000,000 | |
Variable Interest Entity, Not Primary Beneficiary | Factoring Arrangement | |||
Variable Interest Entity [Line Items] | |||
Revolving receivables facility, maximum borrowing capacity | $ 950,000,000 | ||
Revolving receivables facility, outstanding borrowings | 775,000,000 | 772,000,000 | |
Other current assets | 268,000,000 | 378,000,000 | |
Other current liabilities | $ 248,000,000 | $ 357,000,000 |
Sales of Certain Receivables _3
Sales of Certain Receivables - Sales of Receivables and Continuing Involvement (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Other current assets | $ 1,770 | $ 2,496 | |
Other long-term assets | 12,140 | 2,779 | |
Other current liabilities | 769 | 810 | |
Other long-term liabilities | 5,298 | 5,412 | |
Of which: | |||
Gain (loss) on sale of receivables | 18 | $ (25) | |
Factoring and EIP Securitization Arrangement | Variable Interest Entity, Primary Beneficiary | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Derecognized net service receivables and EIP receivables | 2,537 | 2,528 | |
Other current assets | 658 | 766 | |
Carrying amounts of deferred purchase price assets | 769 | 884 | |
Other long-term assets | 113 | 120 | |
Other current liabilities | 248 | 357 | |
Other long-term liabilities | 4 | 4 | |
Net cash proceeds since inception | 1,737 | 1,715 | |
Of which: | |||
Change in net cash proceeds during the year-to-date period | 22 | (229) | |
Net cash proceeds funded by reinvested collections | 1,715 | 1,944 | |
Gain (loss) on sale of receivables | 18 | $ (25) | |
Factoring and EIP Securitization Arrangement | Other current assets - of which, deferred purchase price | Variable Interest Entity, Primary Beneficiary | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Carrying amounts of deferred purchase price assets | 656 | 764 | |
Factoring and EIP Securitization Arrangement | Other long-term assets - of which, deferred purchase price | Variable Interest Entity, Primary Beneficiary | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Carrying amounts of deferred purchase price assets | $ 113 | $ 120 |
Goodwill, Spectrum License Tr_3
Goodwill, Spectrum License Transactions and Other Intangible Assets - Schedule of Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Millions | Apr. 01, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill [Roll Forward] | ||||
Historical goodwill, net of accumulated impairment losses of $10,766 | $ 1,930 | |||
Beginning balance | $ 11,117 | |||
Goodwill from acquisition | $ 9,405 | |||
Accumulated impairment loss | 10,984 | $ 10,766 | ||
Ending balance | 11,158 | 11,117 | ||
Layer3 TV | ||||
Goodwill [Roll Forward] | ||||
Layer3 goodwill impairment | $ (218) | |||
Sprint | ||||
Goodwill [Roll Forward] | ||||
Goodwill from acquisition | $ 9,400 | |||
Purchase price adjustment of goodwill from acquisitions in 2020 | 22 | |||
Ending balance | $ 9,423 | |||
Swiftel | ||||
Goodwill [Roll Forward] | ||||
Goodwill from acquisition | $ 19 |
Goodwill, Spectrum License Tr_4
Goodwill, Spectrum License Transactions and Other Intangible Assets - Narrative (Details) $ in Millions | Apr. 01, 2020USD ($) | Mar. 31, 2021USD ($)license | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Oct. 31, 2020USD ($) |
Goodwill [Line Items] | ||||||
Goodwill from acquisition | $ 9,405 | |||||
Purchase of spectrum licenses | $ 8,922 | $ 99 | ||||
Amortization expense for intangible assets | 366 | $ 25 | ||||
Licensing Agreements | Auction 107 | ||||||
Goodwill [Line Items] | ||||||
Number of licenses | license | 142 | |||||
Aggregate purchase price | $ 9,300 | |||||
Asset purchase deposit | $ 438 | |||||
Purchase of spectrum licenses | $ 8,900 | |||||
Expected remaining cost | $ 1,200 | |||||
Sprint | ||||||
Goodwill [Line Items] | ||||||
Goodwill from acquisition | $ 9,400 | |||||
Sprint | Favorable lease (asset) | ||||||
Goodwill [Line Items] | ||||||
Finite-lived, fair value | $ 745 | |||||
Weighted average useful life | 18 years | |||||
Sprint | Unfavorable spectrum leases | ||||||
Goodwill [Line Items] | ||||||
Finite-lived, fair value | $ 125 | |||||
Weighted average useful life | 19 years | |||||
Sprint | Customer relationships | ||||||
Goodwill [Line Items] | ||||||
Finite-lived, fair value | $ 4,900 | |||||
Weighted average useful life | 8 years | |||||
Sprint | Spectrum Licenses | ||||||
Goodwill [Line Items] | ||||||
Fixed period | 15 years |
Goodwill, Spectrum License Tr_5
Goodwill, Spectrum License Transactions and Other Intangible Assets - Schedule of Fair Value of Intangible Assets Acquired in Merger (Details) - Sprint $ in Millions | Apr. 01, 2020USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Total intangible assets acquired | $ 51,680 |
Tradenames | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Average Useful Life (in years) | 2 years |
Finite-lived, fair value | $ 207 |
Customer relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Average Useful Life (in years) | 8 years |
Finite-lived, fair value | $ 4,900 |
Favorable spectrum leases | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Average Useful Life (in years) | 18 years |
Finite-lived, fair value | $ 745 |
Other intangible assets | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Average Useful Life (in years) | 7 years |
Finite-lived, fair value | $ 428 |
Spectrum Licenses | |
Finite-Lived Intangible Assets [Line Items] | |
Indefinite-lived, Fair Value (in millions) | $ 45,400 |
Goodwill, Spectrum License Tr_6
Goodwill, Spectrum License Transactions and Other Intangible Assets - Spectrum Licenses (Details) - Licensing Agreements $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Beginning balance | $ 82,828 |
Spectrum license acquisitions | 72 |
Costs to clear spectrum | 1 |
Ending balance | $ 82,901 |
Goodwill, Spectrum License Tr_7
Goodwill, Spectrum License Transactions and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 6,624 | $ 6,665 |
Accumulated Amortization | (1,732) | (1,367) |
Net Amount | 4,892 | 5,298 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
2022 | 1,154 | |
2023 | 941 | |
2024 | 785 | |
2025 | 627 | |
2026 | 468 | |
Thereafter | 917 | |
Net Amount | 4,892 | 5,298 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 4,903 | 4,900 |
Accumulated Amortization | (1,153) | (865) |
Net Amount | 3,750 | 4,035 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Net Amount | $ 3,750 | 4,035 |
Customer relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life (in years) | 8 years | |
Tradenames and patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 603 | 598 |
Accumulated Amortization | (461) | (412) |
Net Amount | 142 | 186 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Net Amount | $ 142 | 186 |
Tradenames and patents | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life (in years) | 19 years | |
Favorable spectrum leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 741 | 790 |
Accumulated Amortization | (44) | (35) |
Net Amount | 697 | 755 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Net Amount | $ 697 | 755 |
Favorable spectrum leases | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life (in years) | 27 years | |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 377 | 377 |
Accumulated Amortization | (74) | (55) |
Net Amount | 303 | 322 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Net Amount | $ 303 | $ 322 |
Other | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life (in years) | 10 years |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 3 Months Ended | |||||||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 23, 2021 | Jan. 14, 2021 | Dec. 31, 2020 | Apr. 06, 2020 | Oct. 31, 2018 | |
Derivative [Line Items] | ||||||||
Net cash related to derivative contracts under collateral exchange arrangements | $ 0 | $ 580,000,000 | ||||||
Accumulated other comprehensive loss | 1,545,000,000 | $ 1,581,000,000 | ||||||
Level 3 | Fair Value | ||||||||
Derivative [Line Items] | ||||||||
Carrying amounts of deferred purchase price assets | 769,000,000 | 884,000,000 | ||||||
Interest Expense | ||||||||
Derivative [Line Items] | ||||||||
Amount amortized from AOCI into Interest expense | 46,000,000 | $ 0 | $ 0 | |||||
Amount expected to be amortized from AOCI into interest expense over next 12 months | 192,000,000 | |||||||
Senior Secured Notes due 2025, 3.500% | ||||||||
Derivative [Line Items] | ||||||||
Interest rate, stated percentage | 3.50% | |||||||
Senior Secured Notes due 2050, 4.500% | ||||||||
Derivative [Line Items] | ||||||||
Interest rate, stated percentage | 4.50% | |||||||
Senior Notes | ||||||||
Derivative [Line Items] | ||||||||
Principal Issuances | $ 3,800,000,000 | $ 3,000,000,000 | $ 19,000,000,000 | |||||
Interest Rate Contract | ||||||||
Derivative [Line Items] | ||||||||
Accumulated other comprehensive loss | $ 1,600,000,000 | $ 1,600,000,000 | ||||||
Interest Rate Contract | Cash Flow Hedging | ||||||||
Derivative [Line Items] | ||||||||
Aggregate notional amount | $ 9,600,000,000 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Short-term Investments and Long-term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Vendor Financing Arrangement | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term loans | $ 186 | $ 240 |
Level 1 | Carrying Amount | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 34,648 | 29,966 |
Level 1 | Carrying Amount | Senior Notes | Third Party | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 35,983 | 36,204 |
Level 1 | Fair Value | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 36,563 | 32,450 |
Level 1 | Fair Value | Senior Notes | Third Party | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 37,821 | 40,519 |
Level 2 | Carrying Amount | Senior Notes | Affiliates | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 4,721 | 4,716 |
Level 2 | Fair Value | Senior Notes | Affiliates | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 4,941 | $ 4,991 |
Debt - Debt Balances and Activi
Debt - Debt Balances and Activity (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Debt Balances and Activity [Roll Forward] | ||
Long-term debt, beginning balance | $ 61,830 | |
Repayments | (2,219) | $ 0 |
Long-term debt, ending balance | 66,395 | |
Total Debt | ||
Debt Balances and Activity [Roll Forward] | ||
Total debt, beginning balance | 71,125 | |
Indebtedness to affiliates | 6,758 | |
Note Redemptions | (1,964) | |
Repayments | (274) | |
Reclassifications | 0 | |
Other | (106) | |
Total debt, ending balance | 75,539 | |
Third Party | Total Debt | ||
Debt Balances and Activity [Roll Forward] | ||
Total debt to third parties, beginning balance | 66,409 | |
Proceeds from Issuances and Borrowings | 6,758 | |
Note Redemptions | (1,964) | |
Repayments | (274) | |
Reclassifications | 0 | |
Other | (111) | |
Total debt to third parties, ending balance | 70,818 | |
Short-term Debt | Third Party | ||
Debt Balances and Activity [Roll Forward] | ||
Short-term debt, beginning balance | 4,579 | |
Proceeds from Issuances and Borrowings | 0 | |
Note Redemptions | 0 | |
Repayments | (274) | |
Reclassifications | 144 | |
Other | (26) | |
Short-term debt, ending balance | 4,423 | |
Long-term debt | Affiliates | ||
Debt Balances and Activity [Roll Forward] | ||
Long-term debt to affiliates, beginning balance | 4,716 | |
Payments for requisite consents to DT | 0 | |
Note Redemptions | 0 | |
Repayments | 0 | |
Reclassifications | 0 | |
Other | 5 | |
Long-term debt to affiliates, ending balance | 4,721 | |
Long-term debt | Third Party | ||
Debt Balances and Activity [Roll Forward] | ||
Long-term debt, beginning balance | 61,830 | |
Proceeds from Issuances and Borrowings | 6,758 | |
Note Redemptions | (1,964) | |
Repayments | 0 | |
Reclassifications | (144) | |
Other | (85) | |
Long-term debt, ending balance | $ 66,395 |
Debt - Issuances and Borrowings
Debt - Issuances and Borrowings (Details) - USD ($) | Mar. 23, 2021 | Jan. 14, 2021 | Mar. 31, 2021 |
2.250% Senior Notes due 2026 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 2.25% | ||
Principal Issuances | $ 1,000,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 993,000,000 | ||
2.625% Senior Notes due 2029 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 2.625% | ||
Principal Issuances | $ 1,000,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 993,000,000 | ||
2.875% Senior Notes due 2031 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 2.875% | ||
Principal Issuances | $ 1,000,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 993,000,000 | ||
2.625% Senior Notes Due 2026 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 2.625% | ||
Principal Issuances | $ 1,200,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 1,193,000,000 | ||
3.375% Senior Notes due 2029 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 3.375% | ||
Principal Issuances | $ 1,250,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 1,243,000,000 | ||
3.500% Senior Notes due 2031 | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 3.50% | ||
Principal Issuances | $ 1,350,000,000 | ||
Issuance Costs | (7,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 1,343,000,000 | ||
Senior Secured Notes Issued, Total | |||
Debt Instrument [Line Items] | |||
Principal Issuances | $ 6,800,000,000 | ||
Issuance Costs | (42,000,000) | ||
Net Proceeds from Issuance of Long-Term Debt | $ 6,758,000,000 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Mar. 27, 2021 | Mar. 31, 2021 | Mar. 23, 2021 | Jan. 14, 2021 | Oct. 30, 2020 | Apr. 06, 2020 | Mar. 31, 2020 |
Debt Instrument [Line Items] | |||||||
Effective interest rate | 4.30% | 5.20% | |||||
Average debt outstanding during period | $ 73,700,000,000 | $ 25,000,000,000 | |||||
Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 3,800,000,000 | $ 3,000,000,000 | $ 19,000,000,000 | ||||
Senior Secured Term Loan Commitment | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 5,000,000,000 | ||||||
Total outstanding obligation | 2,000,000,000 | ||||||
2.250% Senior Notes due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,000,000,000 | ||||||
Interest rate, stated percentage | 2.25% | ||||||
2.625% Senior Notes due 2029 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,000,000,000 | ||||||
Interest rate, stated percentage | 2.625% | ||||||
2.875% Senior Notes due 2031 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,000,000,000 | ||||||
Interest rate, stated percentage | 2.875% | ||||||
2.625% Senior Notes Due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,200,000,000 | ||||||
Interest rate, stated percentage | 2.625% | ||||||
3.375% Senior Notes due 2029 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,250,000,000 | ||||||
Interest rate, stated percentage | 3.375% | ||||||
3.500% Senior Notes due 2031 | |||||||
Debt Instrument [Line Items] | |||||||
Principal Issuances | $ 1,350,000,000 | ||||||
Interest rate, stated percentage | 3.50% | ||||||
6.500% Senior Notes due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 6.50% | ||||||
Principal Amount | $ 2,000,000,000 | ||||||
Redemption Price (as a percent) | 103.25% | ||||||
Redemption premium | $ 65,000,000 | ||||||
Write-off of issuance costs | $ 36,000,000 |
Tower Obligations - Narrative (
Tower Obligations - Narrative (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021USD ($)tower_site | Mar. 31, 2020USD ($)tower_site | Dec. 31, 2012USD ($)tower_site | Apr. 01, 2020USD ($) | |
Sprint | ||||
Sale Leaseback Transaction [Line Items] | ||||
Property and equipment | $ 18,435 | |||
Adjustment, other long-term liabilities | $ 1,700 | |||
Crown Castle International Corp. | ||||
Sale Leaseback Transaction [Line Items] | ||||
Managed sites | tower_site | 900 | |||
Lease liabilities | $ 282 | |||
Tower Transaction | ||||
Sale Leaseback Transaction [Line Items] | ||||
Lessee leasing arrangements, operating leases, term of contract (years) | 10 years | |||
Sale leaseback transaction, fixed-price purchase options | $ 2,000 | |||
Interest rate on tower obligations | 6.00% | 8.00% | ||
Tower Transaction | Tower | ||||
Sale Leaseback Transaction [Line Items] | ||||
Useful life (in years) | 20 years | |||
Tower Transaction | Crown Castle International Corp. | ||||
Sale Leaseback Transaction [Line Items] | ||||
Property subject to failed sale leaseback transaction, number of units | tower_site | 6,400 | 6,200 | ||
Remaining term of lease | 17 years | |||
Fixed-price purchase option on leased or subleased sites | $ 2,300 | |||
Fixed-price purchase option on lease or subleased sites, exercisable period | 1 year | |||
Days prior to expiration of agreement | 120 days | |||
Initial term | 10 years | |||
Property and equipment | 2,800 | |||
Tower obligations | $ 1,100 | |||
Tower Transaction | Minimum | ||||
Sale Leaseback Transaction [Line Items] | ||||
Lessee leasing arrangements, operating leases, term of contract (years) | 23 years | |||
Tower Transaction | Maximum | ||||
Sale Leaseback Transaction [Line Items] | ||||
Lessee leasing arrangements, operating leases, term of contract (years) | 37 years |
Tower Obligations - Sale Leaseb
Tower Obligations - Sale Leaseback Transaction (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Property and equipment, net | ||
Sale Leaseback Transaction [Line Items] | ||
Sale-leasebacks | $ 2,715 | $ 2,838 |
Failed Sale Leaseback Transaction, Tower Obligations | ||
Sale Leaseback Transaction [Line Items] | ||
Sale-leasebacks | 2,974 | 3,028 |
Other Noncurrent Liabilities | ||
Sale Leaseback Transaction [Line Items] | ||
Sale-leasebacks | $ 1,712 | $ 1,712 |
Tower Obligations - Future Mini
Tower Obligations - Future Minimum Payments (Details) $ in Millions | Mar. 31, 2021USD ($) |
Leases [Abstract] | |
Tower obligation payments, due next year | $ 399 |
Tower obligation payments, due within two and three years | 690 |
Tower obligation payment, due within four and five years | 601 |
Tower obligation payments due thereafter | $ 549 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 19,759 | $ 11,113 |
Postpaid phone revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 9,483 | 5,577 |
Postpaid other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 820 | 310 |
Postpaid service revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 10,303 | 5,887 |
Wireless service revenues | Sprint | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 197 | |
Equipment revenues from the lease of mobile communication devices | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 1,041 | $ 165 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Contract Assets | $ 275 | $ 278 | |
Contract Liabilities | 775 | 824 | |
Change in contract assets included in other current assets | (3) | ||
Change in contracts liabilities included in deferred revenue | (49) | ||
Current portion of contract assets | 205 | $ 204 | |
Amounts included in the beginning of year contract liability balance | $ 683 | $ 528 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Remaining Performance Obligations, Branded Postpaid Contracts (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Postpaid service revenues | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 1,300 |
Remaining contract duration (in years) | 24 months |
Service performance obligations | Sprint | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 1,300 |
Lease performance obligation | Sprint | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 766 |
Remaining contract duration (in years) | 18 months |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining contract duration (in years) | 1 year |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining contract duration (in years) | 9 years |
Revenue from Contracts with C_6
Revenue from Contracts with Customers - Remaining Performance Obligations (Details) $ in Millions | Mar. 31, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 1,000 |
Remaining performance obligation, expected timing of satisfaction, period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 1,200 |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 945 |
Remaining performance obligation, expected timing of satisfaction, period |
Revenue from Contracts with C_7
Revenue from Contracts with Customers - Contract Costs (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Capitalized Contract Cost [Abstract] | |||
Deferred incremental costs to obtain contracts | $ 1,200,000,000 | $ 1,100,000,000 | |
Average amortization period, deferred contract costs (in months) | 24 months | ||
Amortization of deferred costs | $ 248,000,000 | $ 205,000,000 | |
Impairment losses recognized on deferred contract cost assets | $ 0 | $ 0 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Net income | $ 933 | $ 951 |
Weighted average shares outstanding - basic (in shares) | 1,243,520,026 | 858,148,284 |
Effect of dilutive securities: | ||
Outstanding stock options and unvested stock awards (in shares) | 9,263,538 | 7,850,248 |
Weighted average shares outstanding - diluted (in shares) | 1,252,783,564 | 865,998,532 |
Earnings per share - basic (in USD per share) | $ 0.75 | $ 1.11 |
Earnings per share - diluted (in USD per share) | $ 0.74 | $ 1.10 |
Outstanding stock options and unvested stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities (in shares) | 6 | 1,807,812 |
SoftBank contingent consideration | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities (in shares) | 48,751,557 | 0 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
SoftBank contingent consideration | ||
Class of Stock [Line Items] | ||
Potentially dilutive securities (in shares) | 48,751,557 | 0 |
Mandatory Convertible Preferred Stock Series A | ||
Class of Stock [Line Items] | ||
Preferred shares authorized (in shares) | 100,000,000 | |
Preferred stock, par value (in USD per share) | $ 0.00001 | |
Preferred shares outstanding (in shares) | 0 | 0 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Loss Contingencies [Line Items] | |
Purchase commitment, due next year | $ 3,900 |
Purchase commitment, due within two and three years | 4,300 |
Purchase commitment, due within four and five years | 2,200 |
Purchase commitment, due thereafter | 1,600 |
Lease and service credit commitment, due next year | 340 |
Lease and service credit commitment, due within two and three years | 662 |
Lease and service credit commitment, due within four and five years | 579 |
Lease and service credit commitment, due thereafter | 5,000 |
Maximum remaining commitment | 91 |
Merger commitment, due next year | 24 |
Merger commitment, due within two and three years | 37 |
Merger commitment, due within four and five years | $ 11 |
Minimum | |
Loss Contingencies [Line Items] | |
Commitment term | 15 years |
Maximum | |
Loss Contingencies [Line Items] | |
Commitment term | 30 years |
Restructuring Costs - Restructu
Restructuring Costs - Restructuring Plan Expenses Incurred (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring Charges | $ 34 |
Plan to Date | 1,094 |
Contract termination costs | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring Charges | 6 |
Plan to Date | 184 |
Severance costs | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring Charges | 16 |
Plan to Date | 401 |
Network decommissioning | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring Charges | 12 |
Plan to Date | $ 509 |
Restructuring Costs - Narrative
Restructuring Costs - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Restructuring and Related Activities [Abstract] | |
Amortization of the right-of-use assets on lease contracts | $ 123 |
Restructuring Term | 3 years |
Restructuring Costs - Activity
Restructuring Costs - Activity Related to Expenses Incurred and Cash Payments Made (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning Balance | $ 163 |
Expenses Incurred | 34 |
Cash Payments | (110) |
Adjustments | (7) |
Restructuring Reserve, Ending Balance | 80 |
Contract termination costs | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning Balance | 81 |
Expenses Incurred | 6 |
Cash Payments | (44) |
Adjustments | 0 |
Restructuring Reserve, Ending Balance | 43 |
Severance costs | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning Balance | 52 |
Expenses Incurred | 16 |
Cash Payments | (38) |
Adjustments | (5) |
Restructuring Reserve, Ending Balance | 25 |
Network decommissioning | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning Balance | 30 |
Expenses Incurred | 12 |
Cash Payments | (28) |
Adjustments | (2) |
Restructuring Reserve, Ending Balance | $ 12 |
Additional Financial Informat_3
Additional Financial Information - Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Supplemental Financial Statement Elements [Abstract] | ||
Accounts payable | $ 4,559 | $ 5,564 |
Payroll and related benefits | 785 | 1,163 |
Property and other taxes, including payroll | 1,540 | 1,540 |
Interest | 777 | 771 |
Commissions | 327 | 399 |
Toll and interconnect | 233 | 217 |
Advertising | 109 | 135 |
Other | 382 | 407 |
Accounts payable and accrued liabilities | 8,712 | 10,196 |
Accounts Payable and Accrued Liabilities | ||
Accounts Payable and Accrued Liabilities [Line Items] | ||
Outstanding checks | $ 285 | $ 628 |
Additional Financial Informat_4
Additional Financial Information - Supplemental Consolidated Statements of Cash Flows Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Related Party Transactions [Abstract] | ||
Interest payments, net of amounts capitalized | $ 945 | $ 341 |
Operating lease payments | 1,651 | 875 |
Income tax payments | 22 | 24 |
Non-cash investing and financing activities | ||
Non-cash beneficial interest obtained in exchange for securitized receivables | 1,381 | 1,613 |
Change in accounts payable and accrued liabilities for purchases of property and equipment | (173) | (301) |
Leased devices transferred from inventory to property and equipment | 485 | 309 |
Returned leased devices transferred from property and equipment to inventory | (445) | (59) |
Operating lease right-of-use assets obtained in exchange for lease obligations | 911 | 555 |
Financing lease right-of-use assets obtained in exchange for lease obligations | $ 109 | $ 178 |