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What’s Driving T-Mobile’s Capex Road Map?

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T-Mobile’s capex

T-Mobile (TMUS), the third-largest and fastest-growing wireless carrier in the United States, has been continuously spending on capex to improve its network. The telecommunications company spent $1.5 billion on cash capex (excluding capitalized interest) in the second quarter compared to $1.3 billion in the previous year’s period.

This YoY (year-over-year) growth was primarily driven by the continued buildout of T-Mobile’s network, which included the deployment of 600 MHz (megahertz) of low-band spectrum.

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Expected capex investments in 2018

T-Mobile’s aggressive deployment of 600 MHz spectrum was the main reason behind its cash capex (excluding capitalized interest) guidance coming in at the high end of its previously guided range of $4.9 billion–$5.3 billion for 2018. This target includes spending on 5G (fifth-generation) deployments.

In comparison, Verizon (VZ) expects its capex for 2018 to be in the range of $17.0 billion–$17.8 billion, while AT&T (T) expects to spend $25 billion on capex. Sprint (S) expects its cash capex to be in the range of $5.0 billion–$6.0 billion excluding leased devices in its fiscal 2018 (which ends in March 2019).

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