Annual Report 2015 A REVOLUTION DRIVING RESULTS AMERICA’S FASTEST GROWING WIRELESS COMPANY AGAIN 2015 was another record-shattering year for the Un-carrier. We drove the revolution forward, delivered strong results and were America’s fastest growing wireless company. Again. • In 2015, T-Mobile grew to 63 million customers strong • 8.3 million total customers added in 2015 alone • 4.5 million branded postpaid customers added • 3.5 million branded postpaid PHONE customers — capturing ALL industry postpaid phone growth in 2015 LISTENING TO CUSTOMERS DELIVERING INNOVATION FROM THE START, THE SECRET TO OUR SUCCESS HAS BEEN NO SECRET AT ALL WE LISTEN. Then we do the hard work to respond to the pain points of US wireless customers with radically simple, industry-rocking innovations. UN-CARRIER 9.0: Business Un-leashed™ After revolutionizing wireless for consumers, T-Mobile unleashed Un-carrier for Business. With Un-carrier 9.0, T-Mobile TRANSLATING CUSTOMER GROWTH TO upended how US business buys wireless — with 100% transparent, fl at-rate pricing, business family discounts and other Un-carrier benefi ts to businesses of all sizes. FINANCIAL GROWTH UN-CARRIER AMPED: Mobile Without Borders™ This year, we began amping up some of our biggest Un-carrier moves. Making them even better. Bigger. Stronger. Starting with Mobile Without Borders,™ T-Mobile introduced a massive expansion of Simple Choice — adding calling, A WINNING FORMULA FOR TMUS STOCKHOLDERS texting and 4G LTE data throughout Mexico and Canada — just like in the US — at no extra charge. Unprecedented customer growth is translating to growth across the board in revenue, UN-CARRIER AMPED: JUMP! On Demand™ profi ts and cash fl ow. And, with JUMP! On Demand, we introduced a whole new way for customers to upgrade to the latest phones with no waiting period or upgrade fees. Get the phone you want, when you want, with nothing upfront and no wait. TOTAL REVENUE UP SERVICE REVENUE UP ADJUSTED EBITDA UP UN-CARRIER AMPED: Personalized 4G LTE Coverage 8.4% 10.9 % 31% The all-new T-Mobile 4G LTE CellSpot™ introduced personal, full-bars LTE coverage virtually anywhere — at no extra charge. YEAR OVER YEAR TO YEAR OVER YEAR TO YEAR OVER YEAR TO UN-CARRIER X: Binge On™ $ $ $ 32.1 BILLION 24.8 BILLION 7.4 BILLION With Un-carrier X, T-Mobile responded to Americans’ surging demand for mobile entertainment by unleashing mobile video. With Binge On, customers can stream all the movies, sports and TV shows they want without ever using their data on partner • Nearly $700 million in free cash fl ow in 2015 • Stock price up 45% in 2015 services like HBO, Netfl ix, ESPN, YouTube — over 60 participating video providers. IN 2015 ALONE WE MORE THAN DOUBLED OUR 4G LTE NETWORK’S HIGHEST GEOGRAPHIC FOOTPRINT INDUSTRY SCORE IN J.D. POWER HISTORY HIGHEST RANKED BY J.D. POWER IN 3 OF THE LAST 4 305 MILLION AMERICANS WIRELESS CUSTOMER CARE STUDIES COVERED IN 2015 Study after study (after study) shows Un-carrier customers are simply more satisfi ed than carrier customers. Here are just a few … • And our 4G LTE network is still the • T-Mobile continues to be a leader in • For the third time in the last four J.D. Power • T-Mobile customers report the highest fastest in the nation — now for 2 years Wi-Fi calling — allowing customers Wireless Customer Care studies, T-Mobile levels of customer service satisfaction and counting (based on customer to get coverage well beyond any came out on top—scoring the highest rating among all national wireless providers. speed tests). cellular network. of any wireless carrier EVER. • T-Mobile Wideband LTE is • We’ve stepped up our network • And our customers are more likely to nationwide — with data speeds up where it really counts — if you • T-Mobile’s Net Promoter Score is now recommend T-Mobile to others than to 150 Mbps. haven’t tried it in the last 6 months, highest among national providers. customers of any of the major carriers. you haven’t tried it at all. • We’ve been aggressively rolling out • Our analysis of Nielsen Mobile Insights Extended Range LTE — which • We’ll continue to focus on our research shows we lead all the big carriers carries signals 2x farther and network in 2016 — increasing in overall customer satisfaction. 4x deeper indoors than before. the depth and breadth where it matters most. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2015 or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 1-33409 T-MOBILE US, INC. DELAWARE 20-0836269 (State of incorporation) (I.R.S. Employer Identification No.) 12920 SE 38th Street, Bellevue, Washington 98006-1350 (Address of principal executive offices) (Zip Code) (425) 378-4000 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Each Exchange on Which Registered Common Stock, $0.00001 par value per share The NASDAQ Stock Market LLC 5.50% Mandatory Convertible Preferred Stock, Series A, $0.00001 The NASDAQ Stock Market LLC par value per share Securities registered pursuant to Section 12(g) of the Act: None. Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No As of June 30, 2015, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $10.9 billion based on the closing sale price as reported on the New York Stock Exchange. As of February 11, 2016, there were 818,420,728 shares of common stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Part III of this Annual Report on Form 10-K incorporates by reference certain portions of the definitive Proxy Statement for the registrant’s Annual Meeting of Stockholders, which definitive Proxy Statement shall be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Report relates. T-Mobile US, Inc. Form 10-K For the Year Ended December 31, 2015 Table of Contents PART I Item 1. Business 3 Item 1A. Risk Factors 9 Item 1B. Unresolved Staff Comments 18 Item 2. Properties 18 Item 3. Legal Proceedings 19 Item 4. Mine Safety Disclosures 19 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 19 Item 6. Selected Financial Data 21 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 21 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 41 Item 8. Financial Statements and Supplementary Data 43 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 85 Item 9A. Controls and Procedures 85 Item 9B. Other Information 86 PART III Item 10. Directors, Executive Officers and Corporate Governance 86 Item 11. Executive Compensation 87 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 87 Item 13. Certain Relationships and Related Transactions, and Director Independence 87 Item 14. Principal Accounting Fees and Services 87 PART IV Item 15. Exhibits and Financial Statement Schedules 87 SIGNATURES 88 INDEX TO EXHIBITS 90 2 Cautionary Statement Regarding Forward-Looking Statements This Annual Report on Form 10-K (“Form 10-K”) includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including information concerning our future results of operations, are forward-looking statements. These forward-looking statements are generally identified by the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “could” or similar expressions.