Good afternoon. Welcome to the T-Mobile Second Quarter 2020 Earnings Call. I would now like to turn the conference over to Mr. Jud Henry, Senior Vice President and Head of Investor Relations for T-Mobile US. Please go ahead.

Good afternoon and welcome to T-Mobile's Second Quarter 2020 Earnings Call. With me today are Mike Sievert, our President and CEO; Peter Osvaldik, our CFO; Neville Ray, our President, Technology; Matt Staneff, our Chief Marketing Officer; and Janice Kapner, our Chief Communications Officer; as well as other members of the senior leadership team joining us remotely. During this call, we will make forward-looking statements that include projections and statements about our future financial and operating results, our plans, the benefits we expect to receive from our merger with Sprint, our business and operations in light of COVID-19 and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of our management and are subject to significant risks and uncertainties outside of our control that could cause actual results to differ materially, including the risk factors set forth in our filings with the SEC. Reconciliations between GAAP and the non-GAAP metrics we discuss on this call can be found in the Quarterly Results section of the Investor Relations page on our website. Also, I want to point out that our comments related to Q2 2020 reflect the combined results of new T-Mobile unless otherwise noted. The prior period results and earnings materials that accompany our Q2 results represent the standalone T-Mobile prior to the merger with Sprint. While we do provide some unaudited pro forma historical financials on a supplemental basis, they are not directly comparable with the actual results for new T-Mobile in the second quarter and going forward, nor are they directly comparable with the previously provided pro forma financials that were prepared prior to the completion of final purchase price accounting and policy alignment issues. We are not providing pro forma historical customer base metrics due to the inability to repose its historical activity under all new T-Mobile subscriber policy. As such, we will focus our comments on future results and the comparable forward-looking guidance as the best way of looking at the business moving forward. With that, let me now turn it over to Mike.

Okay. Thanks Jud, and hi to everybody listening in or watching online. We are coming to you live and socially distanced from here in our Bellevue headquarters. So I am pleased that it is nice to be back in the office for once given we are behind these huge glass panels and sitting 10 feet apart. First of all, let me just say, thanks in advance for your patience, because my upfront remarks will be just a few minutes longer than usual today given that this is our first quarterly report for the new company and there is a lot to cover. I promise I am not filibustering. Q2 was our first quarter together and what a quarter it was. I am incredibly fired up about everything this new combined team has accomplished since we last spoke in May and I am more excited than ever about the future of T-Mobile. We have already hit major milestones in record time and made significant progress on integration, and we did it while achieving incredible business results for the quarter. We know that very quarter our competitors were telling you we’d be too distracted by the merger to execute. Yes, that’s what. So let me start by saying this: we kicked off the quarter by achieving something nobody really thought possible just a short time ago. Our total branded customer accounts surpassed AT&T, making us the number two player in wireless at the beginning of the quarter. This monumental milestone in U.S. wireless history was a historic achievement for all of us at T-Mobile. And even better we haven’t looked back since. We have no intention of slowing down. Our lead versus AT&T is even wider as we talk to you today. In Q2, T-Mobile once again led the industry in total branded customer growth for the 22nd consecutive quarter, firmly establishing new T-Mobile as the leading growth company in the industry. Now with over 98 million customers at quarter end, we are steering down Verizon, but our sights are set on the number one spot. Despite the significant challenges we all faced this quarter, in T-Mobile’s case including combining with a much slower growth company in Sprint and continuing to deal with the global pandemic that led to a lower switching environment, this team adapted and delivered. We didn’t skip a beat. In fact, we moved faster. We again led the industry at adding 1.2 million total branded customers across postpaid and prepaid in Q2, four and three times what AT&T and Verizon combined added. Total postpaid net additions were 1.1 million, also leading the industry and over three times more than Verizon, who was the closest competitor. We actually got something of a formula when trying to divide by a negative number for our AT&T comparison. And believe we grow that. Needless to say, we are still competing aggressively and our team is having fun with it. And while we are on this topic, I do want to take this opportunity to recognize our T-Mobile core business team for really stepping up in a big way to help schools and businesses adapt to new remote learning and work challenges that are needed. Most of our overperformance this quarter versus guidance on postpaid was in this area. We also delivered 253,000 postpaid phone net adds, beating the national carriers again for the 26th quarter in a row. And this is after taking a 90,000 unit postpaid customer disconnect due to the FCC keeping Americans connected. And not to be forgotten, we also delivered Q2 postpaid phone churn of 0.8%, prepaid churn of just 2.81%. I am particularly proud of the churn progress as we integrate the traditionally higher churning Sprint business. Now let's talk about how all of our teams’ hard work and real-time adjustments to the rapidly changing market resulted in incredibly strong Q2 financial results. This includes adjusted EBITDA of $7.0 billion, which exceeded our guidance. Our new CFO, Peter Osvaldik will share more on our financial results in a moment, but I’ll just remind you that our formula is pretty simple: investing in customers leads to customer growth which leads to revenue growth, which if we run the company well leads to EBITDA and cash flow growth, a lot of which we invest right back into our customers and their network experience. It’s a virtuous cycle that delivered all of our early success as the un-carrier and it will continue to propel us to our goal of being number one in customer choice and number one in customer starts. While delivering these accomplishments, we kicked off a huge list of milestones that positioned new T-Mobile to win. Peter will share more details about our work in the market, but I just wanted to mention three big milestones. First, our team executed the largest dual tranche second offering in U.S. history, the sale of SoftBank’s shares in T-Mobile, and actually created a positive trading dynamic in our stock with the transaction. We also fulfilled a significant merger commitment when we closed our transaction with DISH to divest the Sprint Prepaid business. Additionally, we issued $4 billion of senior secured notes at a weighted average interest rate of just 2.16%. All three had super successful outcomes. On the customer side, we launched Connecting Heroes, providing free smartphone service and 5G access to state and local non-profit first responder agencies nationwide. This was the second initiative in our 5G for Good un-carrier announced last year following T-Mobile Connect, the low-price plan we launched ahead of schedule in Q1. The final part of that move, Project 10 Million, will be coming very soon, so stay tuned. We also unveiled our latest un-carrier move, Scam Shield. Scams and robocalls are a huge customer pain and are the leading FCC complaint. So we put together the industry’s most comprehensive solution for customers to help stop those disturbances. With Scam Shield, we are helping protect T-Mobile and Sprint customers – they can report scammers for free, while AT&T and Verizon require customers to pay a premium for it. This move clearly mattered to consumers, because this announcement drove massive social media engagement and the most press coverage we’ve received since our first un-carrier move back in March of 2013. Unlike all un-carrier moves, Scam Shield is designed to change wireless for good. So I hope that AT&T and Verizon will step up to our challenge and join us in taking this problem more seriously. And I can’t forget to mention that T-Mobile’s care team continues to break records. We just recently received the highest ever score recorded in our industry on the J.D. Power 2020 Customer Care Survey, taking home our sixth win in a row and the 20th time we’ve ranked highest among full-service providers. Our team loves our customers, and it shows. Okay. I really just scratched the surface on what this team accomplished this past quarter, but I know you are all really interested in our talk books and that’s of course integration. And the work we are doing to build big and build fast on synergy attainment. Let’s start with the network. This is a huge piece of our synergy realization. Neville and his team are full steam ahead. We’ve talked about the fact that the biggest block of our synergies comes from the network and that it’s a three-step process as we first light up the available Sprint spectrum on the new T-Mobile anchor network, second, creates the capacity to migrate the Sprint traffic over, and then third, allows us to finally decommission the sites that aren’t in the go forward. That of course takes time and amazingly decommissioning, the third step, our initial sites are already under way. The network teams are working in overdrive to migrate Sprint postpaid traffic to the T-Mobile network and it shows. In fact, as of today, we have already moved more than 10% of this traffic before we’ve even started the customer migration. This is possible, because we now have more than 85% of Sprint’s postpaid phone base with devices that work on the T-Mobile network, something we made fully available right out of the gate. So now, over 10 million Sprint postpaid customers are on average using the T-Mobile network every single day. Plus, the Sprint base historically had limited access to VoLTE, voice-over-LTE. But we already have roughly 75% of the Sprint postpaid base now enabled on VoLTE. So they are enjoying a better voice experience with simultaneous data. I hope those stats surprise you as much as they did for us. We also officially unveiled our retail operations and unified our retail operations and rebranded thousands of Sprint stores to T-Mobile stores last Sunday. This is an important milestone for our business, and while we did it, we also rolled out the needed tools and systems across our distribution footprint to allow us to serve both legacy bases of postpaid customers in all T-Mobile stores. Let me be clear, this was a massive lift. I just can’t say enough how our team flawlessly nailed this effort and executed incredibly fast. This would have been a major accomplishment even outside of a pandemic, and it was really amazing to see all of that come to life during these complicated times. And since bringing two big brands like T-Mobile and Sprint together only comes around once, we wanted to market in true un-carrier fashion by doing something really big for our customers. So we launched four lines for the industry’s best unlimited for $25 each per month. This is possibly our most ambitious consumer promotion ever, and it includes 5G access. Remember, the other guys may be charging extra for 5G; ours includes it. Now to be clear, this is a limited-time promotion to celebrate and build awareness for the newly integrated brand, but even after it’s done, we’ll find ways to compete. We said we would bring the competition with this merger, and I hope we’ve addressed any lingering questions on that front. I’ve said it before and I’ll say it again. We are here to show customers that they no longer have to choose between the best value and the best network with T-Mobile; they’ll get both. Our teams have also been working hard to rapidly deliver T-Mobile benefits to legacy Sprint customers, and they are loving all the un-carrier goodness, like having access to the same great unlimited plans without future step-ups, and perks like T-Mobile Tuesdays. While the synergies we are starting to see are not just for our investors, our customers are winning big too. At the same time, we are focused on evolving our organization structure and design to become one team that will be more efficient and more effective with clear roles and responsibilities for our employees that will help us all move faster and deliver results for the business. This was a process that we originally expected to take 12 to 18 months, but we nearly completed it in just one quarter, and we felt it was important to do so. And we are hiring. We’ve doubled down in areas that are focused on better serving our customers today and in the future by kicking off our un-carrier jobs initiative, adding 5,000 new positions in just the first 12 months alone. We also accelerated the rationalization of hundreds of retail stores, work that we originally planned to do over several quarters, and we consolidated and began to adjust our marketing spend well ahead of schedule. These actions in Q2 alone are beginning to unlock significant synergies now, setting us up financially to be able to make investments throughout 2020 and next year and ultimately unlocking future synergies on a net basis. Last time, I told you I was even more confident in our synergy plans than I was before the merger. I just hope now you understand why. We are executing lightning fast. We said we would, but now we’ve laid down a ton of track; thus, based on the quick action we’ve taken, I am confident in our ability to not only deliver $43 billion in synergies like we previously discussed, but potentially unlock even more than originally planned and to do it all faster than planned. Now let me just say a few words about one of my favorite topics, our rapidly expanding network. In the 5G race, T-Mobile is pulling way ahead. In the past few years, we’ve heard a lot of competitive marketing speak when it comes to 5G, all talk, and most of it is just higher. AT&T and Verizon don’t want you to see what’s becoming so painfully obvious. T-Mobile is miles ahead of both of them and we are quickly pulling away from the past. But instead of taking my word for it or Verizon’s or AT&T’s for that matter, let’s just take a look at a few actionable facts. Nobody disputes that we have America’s largest 5G network, and the competition isn’t even close. Just this week, we had a major breakthrough when we launched standalone 5G. Now, our 5G network reaches over 250 million people and covers 1.3 million square miles. We now offer coverage across all 50 states and Puerto Rico on 5G. This geographic coverage is roughly double AT&T’s and exponentially higher than Verizon’s. But it’s not just our reach that matters. It’s the experience our customers have on our network too that differentiates T-Mobile’s 5G from the other wireless players. Verizon, as you know, likes to spend a lot of time telling you that they have a real 5G, but its 5G is all about ultra-wide band or millimeter wave. But again, let’s put the facts on the table. T-Mobile customers with 5G handsets already have faster average speeds in more places than Verizon customers with 5G handsets. And we are just getting started lighting up our mid-band. We are already lighting it up in 2.5 GHz in major metros including New York, Houston, Los Angeles, Dallas, Washington DC, and Atlanta. And by the end of the year, customers will find mid-band 5G in thousands of cities and towns across the country. At the end of this year, we are currently seeing average speeds north of 300 megabits per second, better than most home internet speeds and eight times faster than 4G LTE, with peak speeds of a gigabit. It will be even faster as we exit the year, plus a massive footprint. But even today, we have the advantage. Take a look at OpenSignal plays. T-Mobile customers have the best 5G availability, meaning that un-carrier customers get a 5G signal more often than customers on any other network; that’s two times more than AT&T’s 5G and six times more than Verizon’s. Not to mention, we found that T-Mobile customers get a 5G signal in nearly four times more cities than Verizon and AT&T combined. By the way, Verizon would also like to excitedly tell you that in that same Ookla test, they have the fastest 5G speed scores, but they often forget to also mention that you can only find their 5G 0.4% of the time. And maybe they’ll deliver nationwide 5G coverage someday, but they’ll beg, borrow, and steal from their LTE networks to claim the tools like dynamic spectrum sharing will overcome their spectrum shortage. When you get to what’s real about 5G, T-Mobile’s network is demonstrably ahead of the competition, even as we just start pouring on the gas. And it’s now clear to most observers that it takes all circumstances to build a real 5G network, and our strategy to use 600 MHz low band as the foundation for 5G, something we had planned for years in advance, was the right move to make. But it also shows just how well positioned we are to take share in the 5G era that everyone is now talking about. T-Mobile controls 319 MHz of combined low and mid-band spectrum on average nationwide. That’s more than AT&T and Verizon combined. We also have more millimeter wave spectrum than AT&T, and get this, we already have as many 5G devices on our network as AT&T and Verizon combined. This is a huge advantage for us as 5G becomes more prevalent for businesses and consumers. All of our brands will benefit from a robust 5G network, and according to the facts on the ground, T-Mobile customers are already taking advantage of how quickly we lit up that 600 MHz footprint. And the work we’ve already begun to do to rapidly increase capacity and boost speeds with the second layer of our 5G layer gig, our deep 2.5 GHz spectrum. Honestly, I don’t think I could be more excited about the progress we’ve made on this network and what we are building every single day. The fastest President Neville will tell us more about all of this when he gets his first question, almost regardless of the question he actually gets asked. As the growth leader in wireless, we are poised to bring an even more capable un-carrier to even more customers in more places. We are building the best network and offering the best value, and that’s what supercharging the un-carrier is all about. We’ve set the stage for a strong second half by delivering powerful Q2 results. But as you know, we are not stopping there. I really believe that as the 5G era finally gets underway at scale later this year, this is our moment. We are way ahead. We have the strongest assets, and we have what will very quickly become the demonstrably superior network in the U.S. combined with the un-carrier’s brand DNA. That’s a powerful combination that our competitors will struggle to match, and that will translate into results. Okay. Now I am going to ask our new CFO, Peter Osvaldik, to take us through the financials and our guidance. Most of you know Peter. Prior to taking this role, Peter was already a huge contributor to our outstanding results. He served for years as our Chief Accounting Officer and number two Financial Officer, participating in every major financial decision that we make. And like me, he knows what it’s like to have big shoes to fill and his transition to the CFO role has been seamless. It comes at an important time for our business. So I am thrilled to have him in the role and Peter, take it away.

Alright. Thanks, Mike. I couldn’t be more excited to lead as CFO during this critical time for the business. We have an incredible all-star leadership team, and I feel privileged to be working alongside each of you. We’ll continue to execute on our proven playbook and unlock the incredible synergy potential of this merger for the years to come. Before we get into the financial details, I wanted to cover a few points which lay the groundwork for our reporting. First, we aligned the legacy Sprint and T-Mobile subscribers to our go-forward new T-Mobile policies. The net impact of these changes, as outlined in more detail in our investor fact book and 10-Q, resulted in a net reduction in total branded customers to 14.1 million as of April 1, compared to the standalone balances previously reported for Sprint and T-Mobile as of March 31. The biggest adjustment was the removal of 9.2 million customers associated with the DISH divestiture, including 963,000, which had been classified as postpaid phone customers in the previously reported Sprint figures. The adjustments also included approximately 40 million subscribers associated with reseller arrangements, which were reclassified from postpaid to wholesale. And recall that we no longer report wholesale subscribers, rather focusing on wholesale revenue. It is important to remember that these adjustments have more of a net impact on profitability. In addition, we are providing disclosures around the various impacts from purchase accounting and policy alignment in our 10-Q, but in the interest of time, I won’t get into too much detail right now. Okay. Now let’s get into some of the financial details of the second quarter. Note that during this quarter, our pretax financial results were impacted by merger-related costs of $798 million, COVID-19-related costs of $341 million, as well as non-cash impairment charges of $418 million related to changes in our postpaid billing systems strategy and a strategic shift in the product transport division enabled through the merger. These costs combined, totaling $1.56 billion before taxes, are excluded from adjusted EBITDA. Q2 net income of $110 million and diluted earnings per share of $0.09 were negatively impacted by these combined factors by $1.25 billion and $1.01 per share. Adjusted EBITDA amounted to $7 billion, exceeding our guidance range. Total service revenue of $13.2 billion was primarily driven by the merger as well as continued customer growth, partially offset by a 1% to 2% headwind from COVID-19-related events. And note that for the reported service revenues, this was excluded and reflected in discontinued operations. Next quarter, the revenue from these customers will be reported in our wholesale service revenues. Net cash provided by operating activities was $777 million, which includes $370 million for merger-related costs and $243 million for COVID-19-related costs. This includes the one-time impact of $2.3 billion in gross payments for the settlement of interest rate swaps on merger financing. Cash purchases of property and equipment, including capitalized interest of $119 million amounted to $2.3 billion. Free cash flow, excluding the settlement of interest rate swaps that I just mentioned, was $1.4 billion, and recall that for the swap, the net cash outflow was only $1.1 billion, as there was an inflow of $1.2 billion in cash flows from investing activities for the return of collateral previously provided. Postpaid ARPA, or Average Revenue Per Account, amounted to 130.57, and postpaid phone ARPU was 47.99. In terms of customer quality, our results in the second quarter were impacted by the macroeconomic requirements of COVID-19. Total bad debt expense and losses from sales of receivables was $263 million or 1.49% of total revenues. This includes approximately $46 million of incremental expense related to the FCC pledge that was excluded from adjusted EBITDA. If we normalize for this amount attributable to the FCC pledge, bad debt would have been 1.23% of revenues, in line with last quarter. As we monitor the impacts of COVID-19 and the FCC pledge in our business, we are encouraged by some of the early trends. Ninety-five percent of all accounts that took advantage of the pledge have made some form of payments since going on the field. Notwithstanding high customer engagement and solid payment performance thus far, there is a small subset of FCC pledge customers that likely will not recover. As a result, our postpaid results for Q2 reflect an accrual of approximately 110,000 deactivations, including 90,000 postpaid phones, as Mike mentioned, for customers that were still with us at the end of the quarter under the FCC pledge, but whom we expect will likely not pay off their remaining balances. Shifting gears to our capital markets activity, in just one quarter as a combined company, we raised $27 billion including $4 billion of senior secured notes issued in June at an average yield of 2.16%, a debt neutral refinancing transaction in which the proceeds will be used to retire high-yield debt in Q3, with an MPD benefit of approximately $400 million and record low average yield for our company. This deal was extremely well received and is a testament to the strength of our business and balance sheet. And also, we delivered a $20 billion secondary sale of SoftBank shares to the public, and T-Mobile received a $300 million fee for facilitating the transaction in addition to being reimbursed for all expenses; just remarkable execution by the team in transactions that I am extremely proud of. Okay. Let me now turn to our guidance, which we wanted to provide as we continue to prioritize transparency during uncertain times and when others across the industry have opted to provide little or no guidance compared to normal practice. We are not immune to uncertainty either, but we recognize our unique situation as we provide you with the first set of combined results this quarter, including the impacts of purchase price accounting and policy alignments and, therefore, we felt it was very important to combine with best-efforts guidance for the back half of 2020. As always, we will continue to closely monitor consumer behavior as well as the economic environment related to the pandemic and how it may impact our second half results. New T-Mobile aspires to continue to lead the industry in postpaid growth and expect postpaid net customer additions between 1.7 million and 1.9 million. Just to double-click here, this guidance assumes higher postpaid phone net adds in the third and fourth quarters from what we saw in Q2. Also, while there was a tremendous opportunity to move quickly and win share of postpaid other devices as businesses and schools adapted during environments of remote working and learning, we expect to see a more balanced mix of postpaid phone versus other additions in the back half of the year. We expect higher gross adds as industry churn levels increase, both from typical higher seasonality and the muted churn effect in Q2 as a result of COVID-19. And we see this as an exciting opportunity as net share taker. Adjusted EBITDA is expected to be in the range of $12.4 billion to $12.7 billion for the back half of 2020 and includes leasing revenue of $2.4 billion to $2.6 billion. We expect higher SG&A expenses in the second half, driven by higher selling expenses due to increased gross adds and the impact of close to $319 million of COVID-19-related costs which are excluded from adjusted EBITDA in Q2, moving back into normalized selling expenses. Cash purchases of property and equipment, including capitalized interest are expected to be between $6.5 billion and $6.9 billion as we continue to build out America’s largest 5G network. We expect CapEx to be relatively flat from Q2 to Q3 before ramping significantly in Q4. For the second half of 2020, merger and integration-related costs not included in adjusted EBITDA are expected to be $800 million to $1 billion before taxes and subject to our ability to go faster on integration. While expenses in Q2 were primarily driven by severance and merger deal fees, we expect merger and integration-related cost in the second half to be primarily operational in focus. Net cash provided by operating activities, including payments for merger and integration-related costs, is expected to be in the range of $5.3 billion to $5.7 billion. Free cash flow, including payments for merger and integration-related costs, is expected to be in the range of $300 million to $500 million, impacted by the aforementioned merger costs and increased capital spending on the network. And lastly, in the back half of 2020, our expected effective tax rate will be in the range of 31% to 33%, due primarily to certain non-deductible merger-related costs incurred in the first half of the year that continue to impact the tax rate throughout 2020. However, we anticipate our future rate to be more in line with historical levels.

Now let’s move on to questions. You can ask questions via phone or via Twitter. We will start with a question on the phone. Operator, first question please. And operator, I would like to just point out that in honor of Rich Greenfield and everybody at Light Shed, we will only be taking questions this quarter from people that begin their question with a phrase, 'Great quarter, guys.' Just kidding. Operator.

Hey guys. Thank you. A lot of things to ask about, but I think the number one, as I am talking to people here, is on the second half guidance. The $12.4 billion to $12.7 billion, can you help us bring that back to what I would have considered a like a historical T-Mobile cash EBITDA without EIP benefit and stripping out a lease benefit?

Peter, could you please start? We need to focus on excluding the lease revenues. If you want to assess what we refer to as core EBITDA, it’s not primarily about yield.

I am sorry.

Yes, absolutely. And let me begin with, obviously, the second half guidance is also reflective of increased gross adds from SG&A, right. And that’s both from a seasonal uptick that we expect as an industry in churn which is typical from Q3 to the second half, but also as a result of the COVID-19 cost, $300 million that were excluded in Q2 that again will become part of the normal run rate. And then, you have the leasing revenues, as you said, if you wanted to get to the core adjusted EBITDA.

Okay. So that $10 billion to $10.1 billion or so is what you would consider to be a cash EBITDA number in the way T-Mobile used to operate?

Yes, the way we used to operate, right. Nothing has really changed in terms of how we think about this stuff, right. So, we have adjusted EBITDA, and then you have leasing and lease revenues that get backed out, to get to this more operational view. Adjusted EBITDA is what we focus on and guide on those. So it’s important that you understand that and obviously, bringing in Sprint, there is a much bigger leasing component. And so, the differences between the two are greater now that we’ve merged.

Yes, that's the second thing I wanted to ask. Historically, Sprint engaged in extensive leasing, and T-Mobile attempted it but seemed to prefer not to. Based on the guidance, it appears you will continue leasing phones significantly at least through this year. What are your thoughts on that?

Yes, I mean, I’ll start and I’ll ask Matt Staneff to jump in. Phil, it’s not that we didn’t like it. It’s that our view is that, it hasn’t always been demonstrated to add to enterprise value, and customer satisfaction isn’t there and then you cost later on as a result. So, but it’s a tool in the toolkit. We’ve always done some of it. I think it depends on how it’s done, and we are open to it. The guide doesn’t necessarily imply any big change, obviously. So, leasing revenues come from the run rate that is informed by the customers already in the base. But, Matt, other thoughts about financing in general and how we think about it?

Yes. That’s great. So, as Mike said, we are going to continue with past day one. Right now, we’ve got our new proposition in the market largely it’s T-Mobile the way it was before. The one thing we do is that we have a Sprint customer base, and we are very aggressively taking care of those customers, now watching and managing their churn helping us. A lot of them are on lease upgrade offers. And so, what you can expect over time, obviously, is we are not going to take away seeing some customers that could potentially increase churn. We are going to continue to serve them. And so, that’s part of what you see in the leasing mix as we got options available, the T-Mobile options that we are still going to take care of for customers. And so it will be kind of more of a gradual change in the total mix versus what we are doing for new customers with that.

I appreciate. Thanks.

What we’ll do over – but right now, as you know, we ask a one, and therefore our main go-to market for us to center ground. But we have all these tens of millions of Sprint customers, and a lot of them make like leasing in one another lease device, and we are happy to provide that. So, see that level. Thanks, Phil.

Okay. Great quarter, guys. Actually, I got two questions. First of all, the 80 bps I am sure that that was particularly sort of a bit of a surprise, especially as Sprint a year ago had, I think, 1.8% churn. So, what are you doing to bring that down so quickly, especially given all the integration efforts of the store closings and that kind of things? That’s number one. And then, number two, given the availability to 600 MHz spectrum and the pent-up demand for new phones, are you guys looking at the launch of the iPhone in the fourth quarter as an opportunity to take share? And is that baked into the guidance in back half because I’d point out that you had $7 billion in EBITDA for the quarter but just expecting sort of $12 billion, $12.5 billion for the rest of the year. So, obviously, it looks like you are expecting that’s not necessarily to be the run rate, especially as we look out to the fourth quarter? That would be great. Thanks.

Understood. Matt, do you want to start on churn?

Yes. I’ll start on churn. 80 bps, that’s a great number. It’s a great number to have in the first quarter. Now that we are together and the comparison is accurate. T-Mobile was among the leaders in the category, and as you said, Sprint was in the high ones. I think the last close to 106 and down 180 basis points. One thing to consider is, this was done in Q2 when covered with the Q. And we said the switch in flows were down. We were taking care of customers and then a collection - we’ve accounted for all of that. But Q2 is a bit of an anomaly, and you’ve seen that across the industry in terms of what churn has done. We have been very hard at work. We’ve been talking about what we’ve done, getting the Sprint customer base access to the network. We’ve got 10 million customers kind of on a daily basis using the network. We could provide VoLTE with a much better experience, and we’ve been hard at work giving value to the Sprint customer base. And taking un-carrier principles and deploying them pretty broadly across the base. So we are not predicting where churn will go. And like just Peter said, seasonally, it’s going to be up a little bit and in the third quarter, and we’ve put that into our guidance. And I can’t predict where churn will go, but what I can say is that the things we need to get to where it was at 0.80 last quarter, we will keep doing and more of as we move forward.

And not to mention, in addition, but the legacy T-Mobile side of things, which will be increasingly difficult for us to compare you because we are past day one now and where business is going forward. But, the legacy T-Mobile side had a blockbuster low churn number. And so, blended in that also helps. So this is really gratifying. We have tailwinds on churn over the medium and long haul, because we know what drives it. We have seen this journey on the T-Mobile side from some of the highest churn in the industry to some of the best churn in the industry in its network. And where, I just got done talking at length about how no one is going to be able to catch us on the network. So we are really excited, and to Matt’s point, seasonally this year there are going to be two dynamics. One, COVID-19, we think the impacts of it will start to abate, which brings some normalcy back into the suppression this quarter, as well as what’s normal for T-Mobile, which is a seasonal uptick in the second half, all against the backdrop of real exciting tailwinds. So, that’s the first piece. And the second piece you asked about was, kind of how to think about the second half, and I will say, we have burdened our plan with the activations we think are necessary to deliver the growth that we guided. And that means, we know that gross activations will up in the second half, why I just told you that seasonally and due to COVID, churn will be up, and we’ll outrun that churn and the other guy’s churn will be up, and that’s an opportunity for us. When the other guy’s churn goes up a little bit, that’s when we compete. You asked about phones. I don’t know. I can’t comment about phones. I really hope there is a well-rounded 5G phone portfolio as we exit the year. And so, I’ll just leave it there. If there is, that would be a great competitive moment for us. So, hopefully, that helps, John.

And next we’ll go to Mike Rollins with Goldman Sachs. I am sorry, Brett Feldman with Goldman Sachs. I apologize. Your line is open.

Hey. Thank you for squeezing in. Hopefully Mike come next. I think you need to call this a good quarter, so congratulations on that. I want to talk about the integration. You expressed your confidence in the synergy targets that you had outlined in the release. All the commentary sounds like you are just moving faster than I think we would have expected when you first now at the field two years ago. And one of the questions will be, do we think we can start seeing the synergies come into your numbers more quickly, that would seem like you would be accretive to the NPV and also the integration spending that you outlined for the second half of this year actually looks pretty modest considering that you had previously talked about spending $15 billion through the integration. So, that’s when you are going to win much more significantly as we move past this year. What would drive that, or are you actually at the point where maybe you are realizing there are greater efficiencies associated with the integration as you get closer to execution on it? Thank you.

Yes. Let me start and then ask Neville to comment. First of all, I love the fact that some of the tower companies that are out there sort of spreading some disinformation about our pace. I just got them tell you we are in all the biggest cities in the country with 2.5 GHz 5G already. And we will be in thousands of cities and towns across this country as we exit this year with that layer gig. So, that’s what we’ll be running really fast. The reason it feels tough over there at the tower companies is because both standalone T-Mobile and Sprint were planning on lots of new sites. Sprint for coverage and T-Mobile for capacity. New T-Mobile has synergies, that’s called site avoidance, and I know that’s tough. If you are a tower company, because millions and billions of dollars of site avoidance are just the kinds of comments you are now hearing. That doesn’t affect our rate and pace we are going like crazy. And you are right, there is not only speed potential which is NPV accretive, but look, the faster we get out in front of the pack on the demonstrable customer provable network leadership, the more of the operating results start to give us the potential to start talking to you about the magnitude of synergies as well. And the enterprise value created from outgrowing our competitors. So, Neville, why don’t you tell us a little bit about the rate and pace, because I know that’s on everybody’s mind?

Yes. I mean, thanks, Mike. I mean, we are moving at an incredible pace. I could not be more pleased with the progress that we’ve made in what’s a few short weeks since we combined with the Sprint team. And it’s on two fronts, I mean, we’ve been rapidly accelerating the breadth of this network, and if I talk to the 250 million people now covered with T-Mobile’s low-band 5G, 327 million of people covered with LTE too, right? And we are closing in on that opportunity for in our 5G footprint. So that gives us the breadth. The depth comes from the 2.5 GHz spectrum, the mid-band slice that’s so important. All I can say is, we are baking that cake super, super fast. So, to give you some idea and dimension for you, I mean, as we get to the second quarter, every week, we were starting up great activity on about 600 sites per week. In the last month, that number has gone to 700 sites per week. So you can all do that math, that thousands of sites in a month and in the quarter, and we are running very, very hard of having that mid-band layer of the network. To this great opportunity, Mike outlined the experience and the speeds. To the earlier question about 5G phones in the fourth quarter, we have a great line-up today, lots of great phones, great news from Samsung just the other day announced, and we want to make sure that there is really only one 5G network that you would love to put a 5G phone on. And it’s from T-Mobile. The coverage is spotty at best from AT&T, and nascent from Verizon. When you can combine great coverage with great performance and speed with mid-band inside the fourth quarter, that’s going to be a complete game changer. So, great quarter. Great numbers. But we are only just getting started with this network rollout, and the pace is phenomenal. Mike outlined, obviously, we are not building in all the places, but standalone T-Mobile and Sprint would have planned to, and that’s good for this business, right. We are starting to generate those cost avoidance, site avoidance synergies at pace, real pace in the second half of this year, and we’ll talk to those numbers more as we close out 2020. But tremendous progress is underway, and I couldn’t be happier. Tower guys are not so happy. We could be doing some more with the tower guys, but there’s a competitive process in play right now, and we have choices that we can make. So, I would fully anticipate that we will start more tower build as we move into the second half, but to be seen. That doesn’t slow us down. We have lots of options to build, and we are building furiously.

And Peter, just very briefly on Brett’s last part, he was asking about the operational spend, and it was maybe, it sounded like it may have been a little less than he was expecting given the Q2 spend. Do you want to unpack that a little bit? Because I think that’s some point people will understand.

Yes. Absolutely, Brett. And as we said, what you saw in Q2, while there was an elevated amount of merger-related cost, there was a lot of transaction and then restructuring and severance, right from acceleration of some of those synergy opportunities. When we fled them to the second half, it is primarily what I would call operational synergy capture now. So, that’s when you think about the pace; that’s an element to consider in there. And of course it’s subject to us identifying ways to prudently go faster, which we are going to continue to do, just like you saw in Q2.

Operationally, it’s experiencing rapid growth in the second half. The operational part of our costs in Q2 was relatively minor, mostly comprised of deal-related transaction expenses. From this point on, all costs will be operational. Therefore, we expect a significant increase in actual costs as we progress through the system in the second half. Is the $15 billion still the budget? Sorry, is this $15 billion still the budget in the outlook for integration? Nothing has fundamentally changed in our goals, and we will eventually provide you with an update on our progress. We have been stating, and I hope we have supported it with evidence and reasons, that we are feeling more confident now. We believe our two-year plan may be somewhat conservative. We still need to provide more details on that, but for now, we have one data point for the company, which is today’s report. We will establish more metrics for you and later provide a revised perspective on the future. We recognize that we still owe you that.

Great. Fair enough. Thank you.

Okay. Thanks. Operator? Meanwhile. Sorry, operator, who is next?

Next we have Michael Rollins from Citi. Your line is open.

Hi. Good afternoon, and thank you for taking my questions. First, when the deal was initially announced, the management mentioned in the projections that there were expectations of revenue challenges related to Sprint plans transitioning into T-Mobile plans. Now that you are completing the process of integrating Sprint metrics into T-Mobile, how do you evaluate any potential challenges from adjusting to T-Mobile plans over the next few years? Secondly, could you provide an update on distribution and presence, considering the integration and ongoing management through the pandemic? I’m also interested in any insights on how customer behavior might be shifting as stores reopen, such as whether there is a trend towards online engagement versus returning to in-store experiences where representatives assist customers. Thank you.

Yes. You bet. And by the way, I got so enamored with the second part. Tell me the first part again, what was the management?

Revenue.

Yes. So, listen, on pricing, revenues and ARPU and all that, one of the things you got, I think from our report was that we see a relatively stable outlook in the near term. For competitors, I guess, didn’t guide or give you much to go on, we felt with the new company it was important to us to just do a best efforts view and we don’t see catalysts in the near term for big changes one way or the other in ARPU. Separately, you heard Peter start to talk about ARPA and that we’re looking at this at a household level, because we think there is, in the 5G era, all kinds of opportunities to develop deeper relationships with households that would be accretive to ARPA without necessarily affecting ARPU. Thirdly, I’ll say, our plan all along has been to bring a intense level of competition to this market like we have always done as the un-carrier, but now in a sustainable way backed by the long-term network plans that we have. And that’s obviously going to be to the benefit of consumers and we funded that fully in our model. How that relates to ARPU specifically and how that will unfold over the years. Again, I know we have a two-year-old set of spots, and at some point need to update that.

Yes. So this $10.1 billion, which linked to the earlier point around how you think about that and how that can gain positivity impacts. So yes, in ARPU we’re coming off a period of a high end as industry average, and so just the long-standing course and method to how we continue to execute will be performing.

Well said, Matt. So this disconnect during that time that we’re going to drive alongside the spending capabilities. So that changes and restarts, we’re working through that. Over time those pieces will come together. So, yes, there are challenges in the near term for Sprint to migrate migrants to T-Mobile plans when numbers are taken up and all of that, but for T-Mobile we keep competing fiercely.

The last thing I’d say is, as Mike mentioned as well, it feels like it’s always an enterprise value expression of value by retaining and creating a significant brand out of that.

See some of the T-Mobile consumers crossing over to Sprint and rather than what one may have expected, this is actually a big opportunity as well for T-Mobile, moving forward.

Thanks guys.

And we’ll go to our next question, John Hodulik from UBS. Your line is open.

Okay. Great quarter, guys. Actually, I got two questions. First of all, the 80 bps I am sure that that was particularly sort of a bit of a surprise, especially as Sprint a year ago had, I think, 1.8% churn. So, what are you doing to bring that down so quickly, especially given all the integration efforts of the store closings and that kind of things? That’s number one. And then, number two, given the availability to 600 MHz spectrum and the pent-up demand for new phones, are you guys looking at the launch of the iPhone in the fourth quarter as an opportunity to take share? And is that baked into the guidance in back half because I’d point out that you had $7 billion in EBITDA for the quarter but just expecting sort of $12 billion, $12.5 billion for the rest of the year? That would be great. Thanks.

Understood. Matt, do you want to start on churn?

Yes. I’ll start on churn. 80 bps, that’s a great number. It’s a great number to have in the first quarter. Now that we are together and the comparison is accurate. T-Mobile was among the leaders in the category, and as you said, Sprint was in the high ones. I think the last close to 106 and down 180 basis points. One thing to consider is, this was done in Q2 when covered with the Q. And we said the switch in flows were down. We were taking care of customers and then a collection - we’ve accounted for all of that. But Q2 is a bit of an anomaly, and you’ve seen that across the industry in terms of what churn has done. We have been very hard at work. We’ve been talking about what we’ve done, getting the Sprint customer base access to the network. We’ve got 10 million customers kind of on a daily basis using the network.

And so as we watch that closely, as Mike mentioned before, this is a great starting point for customer satisfaction and their coverage levels.

Well thank you gentlemen very much.

Thank you. Ladies and gentlemen, this concludes the T-Mobile U.S. Second Quarter 2020 Earnings Call. If you have any further questions, you may contact Investor Relations or media departments. Thank you for your participation. You may now disconnect. And have a pleasant day.