It is earnings day. Another big earnings day in addition to being a Fed day. One of the companies reporting earnings today was T-Mobile. They put out some really good numbers. Stock up 8.5% on the news. Mike Sievert joins us. He's the CEO of T-Mobile. He joins us here in our Bloomberg Interactive Broker studio. Mike, thanks so much for coming here.
Thanks for having me, guys.
What does the market like about the results you put up today?
Well, look, we're just consistently outperforming expectations, and that's what the market looks for in a business like ours. We're taking share, we're growing, and across the board we beat expectations. We just finished the strongest growth year ever in our history, and that's saying something because we have a storied growth history in this company. A lot of people wonder, is the big growth run behind us? And we just demonstrated yet again, no, it's not.
It's hard for me to get really excited about my mobile service provider, but your customers, they're like they're in a cult. What's the secret sauce? That's my softball question.
Our corporate values start with this basic idea: love our customers. Give them more, ask less of them, and they notice that. That's a huge part of our brand. We have this thing we do called T-Mobile Tuesdays, where every week customers come to our T-Life app, which has 50 million users, and they engage to find out how we are rewarding them this week. Do you know what this week's was? We gave away a Shake Shack burger, like the world's best burger, for free to every single T-Mobile customer.
Netflix too, if you saw it. Absolutely. So Mike, you're in a competitive business. I think about the wireless business, the barriers to change are pretty minimal. Churn is always an issue. Your competitors are good competitors. Is it just you guys switching customers all the time for deals? Talk about the churn for your company, your business.
Churn is at historic lows across the industry, not just T-Mobile. We just had our best churn year ever. So people aren't switching a lot. When they are switching, the net share takers are T-Mobile. So this is a great trend. I don't need for others to fail in order for us to succeed. This is a great neighborhood. We just happen to be the best house in the neighborhood, and so we're outgrowing everyone. But this is a healthy, vibrant sector. Everyone is growing and making money. I think that's great. Part of it is people can't get enough of the service that we all offer. At T-Mobile, we just guided again to a big year of revenue gains per customer, and that's not because of pricing. It's because customers are self-selecting up our rate card to our higher-priced offers because they see the superior value and they want what we have to sell. That's a great dynamic not just for T-Mobile but for the industry.
The growth strategy is organic or M&A?
It's organic principally. We do have a number of M&A deals in the pipeline that we're intending to close this year, centered around fiber, centered around other add-ons. We're also acquiring a cellular company, US Cellular. But by far, the growth is an organic growth story focused on taking share, adding revenues, deepening relationships with the existing customers that now number well past 100 million.
Some of those I don't understand, like outdoor advertising. What does that have to do with your business?
We just announced the acquisition of a company called Vistar. We are a billion-dollar advertising support company already, so this is a significant business for us. We call it marketing services for marketers by marketers. T-Mobile is a very famous marketer, and marketers want services from us. We provide that already. Our T-Life app, part of what it does is it asks customers by the millions whether they would like to opt in to make their digital life better and their advertising more relevant. Then we can use data to provide marketers with an ability to put advertising in front of customers that they will actually appreciate. Our dream with place-based marketing, outdoor marketing, the Vistar acquisition, is to do that for the first time ever in outdoor advertising, so that outdoor advertising, place-based advertising, can become an addressable market.
Yeah, it's interesting. I love the outdoor business. You can't switch channels on that. I took all those companies public back in the day. Apple, Mark Gurman from Bloomberg News: Apple has been working with SpaceX and T-Mobile on Starlink. What is Starlink?
This is the ability to connect your mobile phone directly to satellite service. This is a huge breakthrough. We announced our intention to partner with SpaceX over two years ago, and now finally it's coming to market with the opening of our beta a couple weeks ago. We're bringing on thousands of users, and soon way more than that. We're going to throw the doors open on this thing. If you can see the sky, you're connected. That's our vision.
Point the iPhone at this?
Yeah, that's correct. These are low Earth orbit satellites, so they're easier for your phone to find and vice versa. This country has 500,000 square miles uncovered by any cellular network, and it's a massive part of our landmass. We're about to close that coverage gap.
So if my bucket list is a trip to the South Pole, I don't need cellular service down there. I could just use a T-Mobile iPhone?
Well, I'm going to check on how good the LEO coverage is. But one of the things you point out, and very quickly, to follow: our terrestrial coverage across the continental US and big parts of Alaska is the world's oceans. That's a big piece of this because you'll be able, not right away but as soon as we are able to turn it on, to get your service across the US and as you travel around the oceans outside the reach of any cellular signal. It's in beta testing right now. It's confined to messaging. Hundreds of satellites are in the air. We have a free beta service going on. We're starting to let people into it right now. It's text messaging only, but fast to follow will be light data services and eventually voice.
So I can get rid of my satellite phone? We don't need that anymore.
I think the time will come when that's the case.
