10-Q 1 tmus-20240331.htm TMUS FORM 10-Q tmus-20240331
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
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 Logo_03_2023.jpg
T-MOBILE US, INC.
(Exact name of registrant as specified in its charter)
Delaware20-0836269
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

12920 SE 38th Street
Bellevue, Washington
(Address of principal executive offices)
98006-1350
(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 classTrading SymbolName of each exchange on which registered
Common Stock, par value $0.00001 per shareTMUSThe NASDAQ Stock Market LLC

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 every Interactive Data File required to be submitted 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 such files). Yes  No 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      Yes  No ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
ClassShares Outstanding as of April 19, 2024
Common Stock, par value $0.00001 per share1,171,854,259 



1


T-Mobile US, Inc.
Form 10-Q
For the Quarter Ended March 31, 2024















2

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

T-Mobile US, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)

(in millions, except share and per share amounts)March 31,
2024
December 31,
2023
Assets
Current assets
Cash and cash equivalents$6,708 $5,135 
Accounts receivable, net of allowance for credit losses of $161 and $161
4,253 4,692 
Equipment installment plan receivables, net of allowance for credit losses and imputed discount of $614 and $623
4,059 4,456 
Inventory1,521 1,678 
Prepaid expenses715 702 
Other current assets2,039 2,352 
Total current assets19,295 19,015 
Property and equipment, net39,286 40,432 
Operating lease right-of-use assets26,766 27,135 
Financing lease right-of-use assets3,180 3,270 
Goodwill12,234 12,234 
Spectrum licenses97,154 96,707 
Other intangible assets, net2,445 2,618 
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount of $143 and $150
1,908 2,042 
Other assets4,000 4,229 
Total assets$206,268 $207,682 
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued liabilities$7,720 $10,373 
Short-term debt5,356 3,619 
Deferred revenue846 825 
Short-term operating lease liabilities3,443 3,555 
Short-term financing lease liabilities1,265 1,260 
Other current liabilities1,933 1,296 
Total current liabilities20,563 20,928 
Long-term debt71,361 69,903 
Long-term debt to affiliates1,496 1,496 
Tower obligations3,751 3,777 
Deferred tax liabilities14,187 13,458 
Operating lease liabilities27,827 28,240 
Financing lease liabilities1,163 1,236 
Other long-term liabilities3,846 3,929 
Total long-term liabilities123,631 122,039 
Commitments and contingencies (Note 12)
Stockholders' equity
Common stock, par value $0.00001 per share, 2,000,000,000 shares authorized; 1,266,294,032 and 1,262,904,154 shares issued, 1,177,240,110 and 1,195,807,331 shares outstanding
  
Additional paid-in capital67,786 67,705 
Treasury stock, at cost, 89,053,922 and 67,096,823 shares
(12,982)(9,373)
Accumulated other comprehensive loss(926)(964)
Retained earnings8,196 7,347 
Total stockholders' equity62,074 64,715 
Total liabilities and stockholders' equity$206,268 $207,682 
The accompanying notes are an integral part of these condensed consolidated financial statements.
3

T-Mobile US, Inc.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)

Three Months Ended March 31,
(in millions, except share and per share amounts)20242023
Revenues
Postpaid revenues$12,631 $11,862 
Prepaid revenues2,403 2,417 
Wholesale and other service revenues1,062 1,267 
Total service revenues16,096 15,546 
Equipment revenues3,251 3,719 
Other revenues247 367 
Total revenues19,594 19,632 
Operating expenses
Cost of services, exclusive of depreciation and amortization shown separately below2,688 3,061 
Cost of equipment sales, exclusive of depreciation and amortization shown separately below4,399 4,588 
Selling, general and administrative5,138 5,425 
Gain on disposal group held for sale (42)
Depreciation and amortization3,371 3,203 
Total operating expenses15,596 16,235 
Operating income3,998 3,397 
Other expense, net
Interest expense, net(880)(835)
Other income, net20 9 
Total other expense, net(860)(826)
Income before income taxes3,138 2,571 
Income tax expense(764)(631)
Net income$2,374 $1,940 
Net income$2,374 $1,940 
Other comprehensive income, net of tax
Reclassification of loss from cash flow hedges, net of tax effect of $15 and $14
43 40 
Unrealized gain on foreign currency translation adjustment, net of tax effect of $0, and $0
 2 
Amortization of actuarial gain, net of tax effect of $(2) and $0
(5) 
Other comprehensive income38 42 
Total comprehensive income$2,412 $1,982 
Earnings per share
Basic$2.00 $1.59 
Diluted$2.00 $1.58 
Weighted-average shares outstanding
Basic1,185,298,497 1,219,608,362 
Diluted1,189,092,019 1,224,604,698 
The accompanying notes are an integral part of these condensed consolidated financial statements.

4

T-Mobile US, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)

Three Months Ended March 31,
(in millions)20242023
Operating activities
Net income$2,374 $1,940 
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization3,371 3,203 
Stock-based compensation expense140 177 
Deferred income tax expense715 611 
Bad debt expense282 222 
Losses from sales of receivables21 38 
Gain on remeasurement of disposal group held for sale (13)
Changes in operating assets and liabilities
Accounts receivable(416)(1,268)
Equipment installment plan receivables277 152 
Inventory170 129 
Operating lease right-of-use assets856 1,008 
Other current and long-term assets160 (142)
Accounts payable and accrued liabilities(1,734)(882)
Short- and long-term operating lease liabilities(1,017)(1,009)
Other current and long-term liabilities(172)(183)
Other, net57 68 
Net cash provided by operating activities5,084 4,051 
Investing activities
Purchases of property and equipment, including capitalized interest of $(9) and $(14)
(2,627)(3,001)
Purchases of spectrum licenses and other intangible assets, including deposits(61)(73)
Proceeds from sales of tower sites 6 
Proceeds related to beneficial interests in securitization transactions890 1,345 
Other, net11 (5)
Net cash used in investing activities(1,787)(1,728)
Financing activities
Proceeds from issuance of long-term debt3,473 3,013 
Repayments of financing lease obligations(327)(306)
Repayments of long-term debt(223)(131)
Repurchases of common stock(3,594)(4,619)
Dividends on common stock(769) 
Tax withholdings on share-based awards(192)(187)
Other, net(34)(43)
Net cash used in financing activities(1,666)(2,273)
Change in cash and cash equivalents, including restricted cash and cash held for sale1,631 50 
Cash and cash equivalents, including restricted cash and cash held for sale
Beginning of period5,307 4,674 
End of period$6,938 $4,724 
The accompanying notes are an integral part of these condensed consolidated financial statements.
5

T-Mobile US, Inc.
Condensed Consolidated Statement of Stockholders’ Equity
(Unaudited)

(in millions, except share and per share amounts)Common Stock OutstandingTreasury Stock OutstandingTreasury Shares at CostPar Value and Additional Paid-in CapitalAccumulated Other Comprehensive LossRetained Earnings (Accumulated Deficit)Total Stockholders' Equity
Balance as of December 31, 20231,195,807,331 67,096,823 $(9,373)$67,705 $(964)$7,347 $64,715 
Net income— — — — — 2,374 2,374 
Dividends declared ($1.30 per share)
— — — — — (1,525)(1,525)
Other comprehensive income— — — — 38 — 38 
Stock-based compensation— — — 152 — — 152 
Stock issued for employee stock purchase plan950,082 — — 112 — — 112 
Issuance of vested restricted stock units3,525,790 — — — — — — 
Shares withheld related to net share settlement of stock awards and stock options(1,171,055)— — (192)— — (192)
Repurchases of common stock(21,933,790)21,933,790 (3,604)— — — (3,604)
Other, net61,752 23,309 (5)9 — — 4 
Balance as of March 31, 20241,177,240,110 89,053,922 $(12,982)$67,786 $(926)$8,196 $62,074 
Balance as of December 31, 20221,233,960,078 22,916,449 $(3,016)$73,941 $(1,046)$(223)$69,656 
Net income— — — — — 1,940 1,940 
Other comprehensive income— — — — 42 — 42 
Stock-based compensation— — — 155 — — 155 
Stock issued for employee stock purchase plan1,063,426 — — 126 — — 126 
Issuance of vested restricted stock units3,844,801 — — — — — — 
Shares withheld related to net share settlement of stock awards and stock options(1,263,356)— — (187)— — (187)
Repurchases of common stock(32,963,940)32,963,940 (4,810)— — — (4,810)
Other, net55,316 30,275 (5)8 — — 3 
Balance as of March 31, 20231,204,696,325 55,910,664 $(7,831)$74,043 $(1,004)$1,717 $66,925 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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T-Mobile US, Inc.
Index for Notes to the Condensed Consolidated Financial Statements


7

T-Mobile US, Inc.
Notes to the Condensed Consolidated Financial Statements

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, 2023.

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”) for which 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. Estimates are inherently subject to judgment and actual results could differ from those estimates.

Accounting Pronouncements Not Yet Adopted

Segment Reporting Disclosures

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” The standard expands reportable segment disclosure requirements for public business entities primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit (referred to as the “significant expense principle”). The standard will become effective for us for our fiscal year 2024 annual financial statements and interim financial statements thereafter and will be applied retrospectively for all prior periods presented in the financial statements, with early adoption permitted. We plan to adopt the standard when it becomes effective for us beginning in our fiscal year 2024 annual financial statements. We are currently evaluating the impact this guidance will have on the disclosures included in the Notes to the Consolidated Financial Statements.

Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The standard enhances income tax disclosure requirements for all entities by requiring specified categories and greater disaggregation within the rate reconciliation table, disclosure of income taxes paid by jurisdiction, and providing clarification on uncertain tax positions and related financial statement impacts. The standard will be effective for us for our fiscal year 2025 annual financial statements with early adoption permitted. We plan to adopt the standard when it becomes effective for us beginning in our fiscal year 2025 annual financial statements, and we expect the adoption of the standard will impact certain of our income tax disclosures.

Note 2 – Business Combination

Acquisition of Ka’ena Corporation

On March 9, 2023, we entered into a Merger and Unit Purchase Agreement (the “Merger and Unit Purchase Agreement”) for the acquisition of 100% of the outstanding equity of Ka’ena Corporation and its subsidiaries, including, among others, Mint Mobile LLC (collectively, “Ka’ena”), for a maximum purchase price of $1.35 billion to be paid out 39% in cash and 61% in shares of T-Mobile common stock (the “Ka’ena Acquisition”). On March 13, 2024, we entered into Amendment No. 1 to the Merger and Unit Purchase Agreement, which amended, among other things, certain mechanics of the payment of the purchase
8

consideration for the Ka’ena Acquisition, which will result in a nominal increase in the percentage of cash compared to shares of T-Mobile common stock to be paid out as part of the total purchase price.

The purchase price is variable, dependent upon specified performance indicators of Ka’ena during certain periods before and after closing, and consists of an upfront payment at closing of the transaction, subject to certain agreed-upon working capital and other adjustments, and a variable earnout payable 24 months after closing of the transaction. Our estimate of the upfront payment is subject to Ka’ena’s underlying business performance and the timing of transaction close, and is currently estimated to be $1.2 billion, before working capital and other adjustments, which we currently estimate will result in a net upfront payment of approximately $950 million, with approximately 45% to be paid in cash. Subsequent to March 31, 2024, on April 25, 2024, we received all necessary regulatory approvals and the Ka’ena Acquisition is expected to close on May 1, 2024.

Note 3 – Receivables and Related Allowance for Credit Losses

We maintain an allowance for credit losses by applying an expected credit loss model. 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 the end of the period.

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 (customer default), 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 equipment installment plan (“EIP”) receivables.

Accounts Receivable Portfolio Segment

Accounts receivable balances are predominately comprised of amounts currently due from customers (e.g., for wireless communications services), device insurance administrators, wholesale partners, other carriers and third-party retail channels.

We estimate credit losses associated with our accounts receivable portfolio segment using an expected credit loss model, which utilizes an aging schedule methodology based on historical information and is adjusted for asset-specific considerations, current economic conditions and reasonable and supportable forecasts.

Our approach considers a number of factors, including our overall historical credit losses and payment experience, as well as current collection trends such as write-off frequency and severity. We also consider other qualitative factors such as current and forecasted macroeconomic conditions.

We consider the need to adjust our estimate of credit losses for reasonable and supportable forecasts of future macroeconomic conditions. To do so, we monitor external forecasts of changes in real U.S. gross domestic product and forecasts of consumer credit behavior for comparable credit exposures.

EIP Receivables Portfolio Segment

Based upon customer credit profiles at the time of customer origination, as well as subsequent credit performance, 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 if their assessed credit risk exceeds established underwriting thresholds. In addition, certain customers within the Subprime category may be required to pay a deposit.

To determine a customer’s credit profile and assist in determining their credit class, we use a proprietary credit scoring model that measures the credit quality of a customer leveraging several factors, such as credit bureau information and consumer credit risk scores, as well as service and device plan characteristics.

EIP receivables had a combined weighted-average effective interest rate of 11.1% and 10.6% as of March 31, 2024, and December 31, 2023, respectively.

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The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses:
(in millions)March 31,
2024
December 31,
2023
EIP receivables, gross$6,724 $7,271 
Unamortized imputed discount(489)(505)
EIP receivables, net of unamortized imputed discount6,235 6,766 
Allowance for credit losses(268)(268)
EIP receivables, net of allowance for credit losses and imputed discount$5,967 $6,498 
Classified on our condensed consolidated balance sheets as:
Equipment installment plan receivables, net of allowance for credit losses and imputed discount$4,059 $4,456 
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount1,908 2,042 
EIP receivables, net of allowance for credit losses and imputed discount$5,967 $6,498 

Many of our loss estimation techniques rely on delinquency-based models; therefore, delinquency is an important indicator of credit quality in the establishment of our allowance for credit losses for EIP receivables. We manage our EIP receivables portfolio segment 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, 2024:
Originated in 2024Originated in 2023Originated prior to 2023Total EIP Receivables, Net of
Unamortized Imputed Discount
(in millions)PrimeSubprimePrimeSubprimePrimeSubprimePrimeSubprimeTotal
Current - 30 days past due$1,188 $360 $2,923 $730 $721 $203 $4,832 $1,293 $6,125 
31 - 60 days past due3 4 12 16 4 4 19 24 43 
61 - 90 days past due 1 10 15 4 3 14 19 33 
More than 90 days past due  9 15 6 4 15 19 34 
EIP receivables, net of unamortized imputed discount$1,191 $365 $2,954 $776 $735 $214 $4,880 $1,355 $6,235 

We estimate credit losses on our EIP receivables segment by applying an expected credit loss model, which relies on historical loss data adjusted for current conditions to calculate default probabilities or an estimate for the frequency of customer default. Our assessment of default probabilities or frequency includes receivables delinquency status, historical loss experience, how long the receivables have been outstanding and customer credit ratings, as well as customer tenure. We multiply these estimated default probabilities by our estimated loss given default, which is the estimated amount of default or the severity of loss.

As we do for our accounts receivable portfolio segment, we consider the need to adjust our estimate of credit losses on EIP receivables for reasonable and supportable forecasts of economic conditions through monitoring external forecasts and periodic internal statistical analyses.

The following table presents write-offs of our EIP receivables by year of origination for the three months ended March 31, 2024:
(in millions)Originated in 2024Originated in 2023Originated prior to 2023Total Write-offs
Write-offs$2 $114 $34 $150 

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Activity for the three months ended March 31, 2024 and 2023, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows:
March 31, 2024March 31, 2023
(in millions)Accounts Receivable AllowanceEIP Receivables AllowanceTotalAccounts Receivable AllowanceEIP Receivables AllowanceTotal
Allowance for credit losses and imputed discount, beginning of period$161 $773 $934 $167 $811 $978 
Bad debt expense132 150 282 107 115 222 
Write-offs(132)(150)(282)(122)(140)(262)
Change in imputed discount on short-term and long-term EIP receivablesN/A31 31 N/A54 54 
Impact on the imputed discount from sales of EIP receivablesN/A(47)(47)N/A(54)(54)
Allowance for credit losses and imputed discount, end of period$161 $757 $918 $152 $786 $938 

Off-Balance-Sheet Credit Exposures

We do not have material off-balance-sheet credit exposures as of March 31, 2024. In connection with the sales of certain service accounts receivable and EIP receivables pursuant to the sale arrangements, we have deferred purchase price assets included on our Condensed Consolidated Balance Sheets measured at fair value that are based on a discounted cash flow model using Level 3 inputs, including estimated customer default rates and credit worthiness, dilutions and recoveries. See Note 4 – Sales of Certain Receivables for further information.

Note 4 – Sales of Certain Receivables

We regularly enter 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”), which has been revised and extended from time to time. As of both March 31, 2024, and December 31, 2023, the EIP Sale Arrangement provided funding of $1.3 billion.

In connection with this EIP Sale Arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity (the “EIP BRE”). We consolidate the EIP BRE under the VIE model.

The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, included on our Condensed Consolidated Balance Sheets with respect to the EIP BRE:
(in millions)March 31,
2024
December 31,
2023
Other current assets$330 $348 
Other assets95 103 

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”). On February 27, 2024, we extended the scheduled expiration date of the Service Receivable Sale Arrangement to February 25, 2025. As of both March 31, 2024, and December 31, 2023, the Service Receivable Sale Arrangement provided funding of $775 million.

11

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”). We consolidate the Service BRE under the VIE model.

The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included on our Condensed Consolidated Balance Sheets with respect to the Service BRE:
(in millions)March 31,
2024
December 31,
2023
Other current assets$164 $209 
Other current liabilities423 373 

Sales of Receivables

The following table summarizes the impact of the sale of certain service accounts receivable and EIP receivables on our Condensed Consolidated Balance Sheets:
(in millions)March 31,
2024
December 31,
2023
Derecognized net service accounts receivable and EIP receivables$2,249 $2,388 
Other current assets494 557 
of which, deferred purchase price491 555 
Other long-term assets95 103 
of which, deferred purchase price95 103 
Other current liabilities423 373 
Net cash proceeds since inception1,554 1,583 
Of which:
Change in net cash proceeds during the year-to-date period(29)(114)
Net cash proceeds funded by reinvested collections1,583 1,697 

At inception, we elected to measure the deferred purchase price at fair value with changes in fair value included in Selling, general and administrative expenses on 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 estimated customer default rates and credit worthiness, dilutions and recoveries. As of March 31, 2024, and December 31, 2023, our deferred purchase price related to the sales of service accounts receivable and EIP receivables was $586 million and $658 million, respectively.

We recognized losses from sales of receivables, including changes in fair value of the deferred purchase price, of $21 million and $38 million for the three months ended March 31, 2024 and 2023, respectively, in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income.

Continuing Involvement

Pursuant to the sale arrangements described above, we have continuing involvement with the service accounts receivable and EIP receivables we sell as we service the receivables, are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where a 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.

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Note 5 – Spectrum License Transactions

The following table summarizes our spectrum license activity for the three months ended March 31, 2024:
(in millions)2024
Spectrum licenses, beginning of year$96,707 
Spectrum license acquisitions411 
Spectrum licenses transferred to held for sale(17)
Costs to clear spectrum53 
Spectrum licenses, end of period$97,154 

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, on our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024.

Spectrum Transactions

In September 2022, the Federal Communications Commission (“FCC”) announced that we were the winning bidder of 7,156 licenses in Auction 108 (2.5 GHz spectrum) for an aggregate price of $304 million. At inception of Auction 108 in June 2022, we deposited $65 million. We paid the FCC the remaining $239 million for the licenses won in the auction in September 2022. On February 29, 2024, the FCC issued to us the licenses won in Auction 108, and substantially all of these licenses were deployed in March 2024. The licenses are included in Spectrum licenses on our Condensed Consolidated Balance Sheets as of March 31, 2024.

License Purchase Agreements

DISH Network Corporation

On July 1, 2020, we and DISH Network Corporation (“DISH”) entered into a license purchase agreement (the “DISH License Purchase Agreement”) pursuant to which DISH agreed to purchase certain 800 MHz spectrum licenses for a total of approximately $3.6 billion. The closing of the sale of spectrum under the DISH License Purchase Agreement remains subject to FCC approval. On October 15, 2023, we and DISH entered into an amendment (the “LPA Amendment”) to the DISH License Purchase Agreement pursuant to which, among other things, the parties agreed that (1) DISH will pay us a $100 million non-refundable extension fee (in lieu of the approximately $72 million termination fee that had previously been agreed to), (2) the closing for the purchase of the spectrum licenses by DISH will occur no later than April 1, 2024, (3) if DISH has not purchased the spectrum licenses by such date for any reason (including failure to receive the required FCC approval prior to such date), then the DISH License Purchase Agreement will automatically terminate, and we will retain the $100 million extension fee, (4) if DISH does purchase the spectrum by April 1, 2024, the $100 million extension fee will be credited against the $3.6 billion purchase price, and (5) we are permitted to commence auction of the spectrum prior to April 1, 2024 at our discretion (and subject to DISH’s purchase right). The LPA Amendment was approved by the Court and became effective on October 23, 2023. On October 25, 2023, we received a payment of $100 million from DISH for the extension fee and recorded a corresponding liability within Other current liabilities on our Condensed Consolidated Balance Sheets.

Subsequent to March 31, 2024, DISH did not purchase the 800 MHz spectrum by April 1, 2024. As such, we will recognize a gain for the $100 million extension fee previously paid by DISH in the second quarter of 2024 within Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income and relieve the liability that was initially recorded upon receipt of the payment. Additionally, we have commenced an auction process for the disposition of the spectrum as required under the final judgment agreed to by us, Deutsche Telekom AG (“DT”), Sprint LLC, SoftBank Group Corp. (“SoftBank”) and DISH with the U.S. District Court for the District of Columbia, which was approved by the Court on April 1, 2020. If the specified minimum price of $3.6 billion is not met in the auction, we would be relieved of the obligation to sell the licenses.

Channel 51 License Co LLC and LB License Co, LLC

On August 8, 2022, we, Channel 51 License Co LLC and LB License Co, LLC (together with Channel 51 License Co LLC, the “Sellers”) entered into License Purchase Agreements pursuant to which we will acquire spectrum in the 600 MHz band from the Sellers in exchange for total cash consideration of $3.5 billion. The licenses will be acquired without any associated networks and are currently being utilized by us through exclusive leasing arrangements with the Sellers.

13

On March 30, 2023, we and the Sellers entered into Amended and Restated License Purchase Agreements pursuant to which we and the Sellers agreed to separate the transaction into two tranches of licenses, with the closings on the acquisitions of certain licenses in Chicago, Dallas and New Orleans being deferred in order to potentially expedite the regulatory approval process for the remainder of the licenses. Subsequently, on August 25, 2023, we and the Sellers entered into Amendments No. 1 to the Amended and Restated License Purchase Agreements, which deferred the closings of certain additional licenses in Chicago and Dallas into the second closing tranche. Together, the licenses with closings deferred into the second closing tranche represent $1.1 billion of the aggregate $3.5 billion cash consideration. The licenses being acquired by us, and the total consideration being paid for the licenses, remain the same under the original License Purchase Agreements and subsequent amendments.

The FCC approved the purchase of the first tranche on December 29, 2023, and we expect the closing of the first tranche to occur in the second quarter of 2024, with the associated cash payment expected to occur in the third quarter of 2024. We anticipate that the second closing (on the deferred licenses) will occur in late 2024 or early 2025.

The parties have agreed that each of the closings will occur within 180 days after the receipt of the applicable required regulatory approvals, and payment of each portion of the aggregate $3.5 billion purchase price will occur no later than 40 days after the date of each respective closing.

Note 6 – Fair Value Measurements

The carrying values of Cash and cash equivalents, Accounts receivable and Accounts payable and accrued liabilities approximate fair value due to the short-term maturities of these instruments. The carrying values of EIP receivables approximate fair value as the receivables are recorded at their present value using an imputed interest rate.

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 to help minimize significant, unplanned fluctuations in cash flows or fair values caused by designated market risks, such as interest rate volatility. We do not use derivatives for trading or speculative purposes.

Cash flows associated with qualifying hedge derivative instruments are presented in the same category on our Condensed Consolidated Statements of Cash Flows as the item being hedged. For fair value hedges, the change in the fair value of the derivative instruments is recognized in earnings through the same income statement line item as the change in the fair value of the hedged item. For cash flow hedges, the change in the fair value of the derivative instruments is reported in Other comprehensive income and recognized in earnings when the hedged item is recognized in earnings, again, through the same income statement line item.

We did not have any significant derivative instruments outstanding as of March 31, 2024, and December 31, 2023.

Interest Rate Lock Derivatives

In April 2020, we terminated our interest rate lock derivatives entered into in October 2018.

Aggregate changes in the fair value of the interest rate lock derivatives, net of tax and amortization, of $1.1 billion are presented in Accumulated other comprehensive loss on our Condensed Consolidated Balance Sheets as of both March 31, 2024, and December 31, 2023.

For the three months ended March 31, 2024 and 2023, $57 million and $53 million, respectively, were amortized from Accumulated other comprehensive loss into Interest expense, net, on our Condensed Consolidated Statements of Comprehensive Income. We expect to amortize $241 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense, net, over the 12 months ending March 31, 2025.

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 estimated customer default rates and credit worthiness, dilutions and recoveries. See Note 4 – Sales of Certain Receivables for further information.

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The carrying amounts of our deferred purchase price assets, which are measured at fair value on a recurring basis and are included on our Condensed Consolidated Balance Sheets, were $586 million and $658 million as of March 31, 2024, and December 31, 2023, respectively.

Debt

The fair value of our Senior Notes and spectrum-backed 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. The fair value of our asset-backed notes (“ABS Notes”) was primarily based on quoted prices in inactive markets for identical instruments and observable changes in market interest rates, both of which are Level 2 inputs. Accordingly, our ABS Notes 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, judgment was required in interpreting market data to develop fair value estimates for the Senior Notes to affiliates and ABS Notes. The fair value estimates were based on information available as of March 31, 2024, and December 31, 2023. 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 on our Condensed Consolidated Balance Sheets were as follows:
(in millions)Level within the Fair Value HierarchyMarch 31, 2024December 31, 2023
Carrying AmountFair ValueCarrying AmountFair Value
Liabilities:
Senior Notes to third parties1$73,421 $67,914 $70,493 $65,962 
Senior Notes to affiliates21,496 1,464 1,496 1,499 
Senior Secured Notes to third parties12,050 1,994 2,281 2,207 
ABS Notes to third parties21,246 1,244 748 748 

Note 7 – Debt

The following table sets forth the debt balances and activity as of, and for the three months ended, March 31, 2024:
(in millions)December 31,
2023
Proceeds from Issuances and Borrowings (1)
Repayments
Reclassifications (1)
Other (2)
March 31,
2024
Short-term debt$3,619 $ $(223)$1,983 $(23)$5,356 
Long-term debt69,903 3,473  (1,983)(32)71,361 
Total debt to third parties73,522 3,473 (223) (55)76,717 
Long-term debt to affiliates1,496     1,496 
Total debt$75,018 $3,473 $(223)$ $(55)$78,213 
(1)Issuances and borrowings and reclassifications are recorded net of accrued or paid issuance costs and discounts.
(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 4.1% and 4.0% on weighted-average debt outstanding of $77.4 billion and $73.4 billion for the three months ended March 31, 2024 and 2023, 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 to third parties and short-term and long-term debt to affiliates, net of unamortized premiums, discounts, debt issuance costs and consent fees.

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Issuances and Borrowings

During the three months ended March 31, 2024, we issued the following Senior Notes:
(in millions)Principal IssuancesDiscounts and Issuance Costs, NetNet Proceeds from Issuance of Long-Term DebtIssue Date
4.850% Senior Notes due 2029
$1,000 $(6)$994 January 12, 2024
5.150% Senior Notes due 2034
1,250 (11)1,239 January 12, 2024
5.500% Senior Notes due 2055
750 (7)743 January 12, 2024
Total of Senior Notes issued$3,000 $(24)$2,976 
5.050% Class A Senior ABS Notes due 2029
$500 $(3)$497 February 14, 2024
Total of ABS Notes issued$500 $(3)$497 

Note Repayments

During the three months ended March 31, 2024, we made the following repayments:
(in millions)Principal AmountRepayment Date
4.738% Secured Series 2018-1 A-1 Notes due 2025
$131 Various
5.152% Series 2018-1 A-2 Notes due 2028
92 Various
Total Repayments$223 

Asset-backed Notes

On February 14, 2024, we issued $500 million of 5.050% Class A Senior ABS Notes to third parties in a private placement transaction. These ABS Notes are secured by $667 million of gross EIP receivables and future collections on such receivables. Net proceeds of $497 million from these ABS Notes are presented in Proceeds from issuance of long-term debt on our Condensed Consolidated Statements of Cash Flows in the three months ended March 31, 2024.

As of March 31, 2024, $1.3 billion of our ABS Notes were secured in total by $1.7 billion of gross EIP receivables and future collections on such receivables. Our ABS Notes and the assets securing this debt are included on our Condensed Consolidated Balance Sheets.

The expected maturities of our ABS Notes as of March 31, 2024, were as follows:
(in millions)Expected Maturities
2024$198 
2025552 
2026459 
202741 
Total$1,250 

Variable Interest Entities

In connection with our ABS Notes issuances, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity (the “ABS BRE”), and a trust (the “ABS Trust” and together with the ABS BRE, the “ABS Entities”), in which the ABS BRE holds a residual interest. Each of the ABS Entities meet the definition of a VIE for which we have determined that we are the primary beneficiary, as we have the power to direct the activities of the ABS Entities that most significantly impact their performance. Accordingly, we include the balances and results of operations of the ABS Entities in our condensed consolidated financial statements.

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The following table summarizes the carrying amounts and classification of assets and liabilities included in our Condensed Consolidated Balance Sheets with respect to the ABS Entities:
(in millions)March 31,
2024
December 31,
2023
Assets
Equipment installment plan receivables, net$1,123 $739 
Equipment installment plan receivables due after one year, net376 168 
Other current assets154 101 
Liabilities
Accounts payable and accrued liabilities$2 $1 
Short-term debt413 198 
Long-term debt833 550 

See Note 3 – Receivables and Related Allowance for Credit Losses for additional information on the EIP receivables used to secure the ABS Notes.

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. See Note 13 - Additional Financial Information for our reconciliation of Cash and cash equivalents, including restricted cash.

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. CCI has fixed-price purchase options for the CCI Lease Sites totaling approximately $2.0 billion, exercisable annually on a per-tranche basis at the end of the lease term during the period from December 31, 2035, through December 31, 2049. If CCI exercises its purchase option for any tranche, it must purchase all the towers in the tranche. We lease back a portion of the space at certain tower sites.

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 SPEs but are not the primary beneficiary as we lack the power to direct the activities that most significantly impact the Lease Site SPEs’ 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 on 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 derecognize 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 Condensed Consolidated Balance Sheets. We recorded long-term financial obligations in the amount of the net proceeds received and recognize interest on the tower obligations. 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 the operation of the tower sites.

Acquired CCI Tower Lease Arrangements

Prior to our merger with Sprint (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
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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.

We considered if this arrangement resulted in the sale of the Master Lease Sites for which we would derecognize 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 Condensed Consolidated Balance Sheets.

We recognize interest expense on the tower obligations. The tower obligations are increased by the interest expense and amortized through contractual leaseback payments made by us to CCI. The tower assets are reported in Property and equipment, net on our Condensed Consolidated Balance Sheets and are depreciated to their estimated residual values over the expected useful life of the towers, which is 20 years.

Leaseback Arrangement

On January 3, 2022, we entered into an agreement (the “Crown Agreement”) with CCI. The Crown Agreement extends the current term of the leasebacks by up to 12 years and modifies the leaseback payments for both the Existing CCI Tower Lease Arrangements and the Acquired CCI Tower Lease Arrangements. As a result of the Crown Agreement, there was an increase in our financing obligation as of the effective date of the Crown Agreement of approximately $1.2 billion, with a corresponding decrease to Other long-term liabilities associated with unfavorable contract terms. The modification resulted in a revised interest rate under the effective interest method for the tower obligations: 11.6% for the Existing CCI Tower Lease Arrangements and 5.3% for the Acquired CCI Tower Lease Arrangements. There were no changes made to either of our master prepaid leases with CCI.

The following table summarizes the balances associated with both of the tower arrangements on our Condensed Consolidated Balance Sheets:
(in millions)March 31,
2024
December 31,
2023
Property and equipment, net$2,182 $2,220 
Tower obligations3,751 3,777 
Other long-term liabilities554 554 

Future minimum payments related to the tower obligations are approximately $421 million for the 12-month period ending March 31, 2025, $774 million in total for both of the 12-month periods ending March 31, 2026 and 2027, $816 million in total for both of the 12-month periods ending March 31, 2028 and 2029, and $4.0 billion in total 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 approximately 900 sites and have included lease liabilities of $241 million in our Operating lease liabilities as of March 31, 2024.

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, High Speed Internet, mobile internet devices (including tablets and hotspots), wearables, DIGITS and other connected devices (including SyncUP and IoT);
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.
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Postpaid service revenues, including postpaid phone revenues and postpaid other revenues, were as follows:
Three Months Ended March 31,
(in millions)20242023
Postpaid service revenues
Postpaid phone revenues$11,145 $10,652 
Postpaid other revenues1,486 1,210 
Total postpaid service revenues$12,631 $11,862 

We operate as a single operating segment. The balances presented in each revenue line item on our Condensed Consolidated Statements of Comprehensive Income represent categories of revenue from contracts with customers disaggregated by type of product and service. Postpaid and prepaid service revenues also include revenues earned for providing premium services to customers, such as device insurance services. Revenue generated from the lease of mobile communication devices is included in Equipment revenues on our Condensed Consolidated Statements of Comprehensive Income.

Contract Balances

The contract asset and contract liability balances from contracts with customers as of March 31, 2024, and December 31, 2023, were as follows:
(in millions)Contract
Assets
Contract
Liabilities
Balance as of December 31, 2023$607 $812 
Balance as of March 31, 2024548 836 
Change$(59)$24 

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 $449 million and $495 million as of March 31, 2024, and December 31, 2023, respectively, was included in Other current assets on 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 on our Condensed Consolidated Balance Sheets.

Revenues for the three months ended March 31, 2024 and 2023 include the following:
Three Months Ended March 31,
(in millions)20242023
Amounts included in the beginning of year contract liability balance$698 $667 

Remaining Performance Obligations

As of March 31, 2024, 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 the service is provided on these postpaid contracts over an extended contract term of 24 months from the time of origination.

Information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less has been excluded from the above, which primarily consists of monthly service contracts.

Certain of our wholesale, roaming and service contracts include variable consideration based on usage and performance. This variable consideration has been excluded from the disclosure of remaining performance obligations. As of March 31, 2024, the aggregate amount of the contractual minimum consideration for wholesale, roaming and service contracts is $1.3 billion, $1.6 billion and $2.8 billion for the remainder of 2024, 2025, and 2026 and beyond, respectively. These contracts have a remaining duration ranging from less than one year to eight years.
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Contract Costs

The balance of deferred incremental costs to obtain contracts with customers was $2.1 billion as of both March 31, 2024, and December 31, 2023, and is included in Other assets on 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 included in Selling, general and administrative expenses on our Condensed Consolidated Statements of Comprehensive Income were $489 million and $422 million for the three months ended March 31, 2024 and 2023, 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, 2024 and 2023.

Note 10 – Stockholder Return Program

2023-2024 Stockholder Return Program

On September 6, 2023, our Board of Directors authorized our 2023-2024 Stockholder Return Program of up to $19.0 billion that will run from October 1, 2023, through December 31, 2024 (the “2023-2024 Stockholder Return Program”). The 2023-2024 Stockholder Return Program consists of repurchases of shares of our common stock and the payment of cash dividends.

On January 24, 2024, our Board of Directors declared a cash dividend of $0.65 per share on our issued and outstanding common stock, which was paid on March 14, 2024, to stockholders of record as of the close of business on March 1, 2024.

On March 15, 2024, our Board of Directors declared a cash dividend of $0.65 per share on our issued and outstanding common stock, which is payable on June 13, 2024, to stockholders of record as of the close of business on May 31, 2024.

During the three months ended March 31, 2024, we paid an aggregate of $769 million in cash dividends to our stockholders, which was presented within Net cash used in financing activities on our Condensed Consolidated Statements of Cash Flows, of which $388 million was paid to DT. As of March 31, 2024, $756 million for dividends payable is presented within Other current liabilities on our Condensed Consolidated Balance Sheets, of which $386 million is payable to DT.

During the three months ended March 31, 2024, we repurchased 21,933,790 shares of our common stock at an average price per share of $162.69 for a total purchase price of $3.6 billion under the 2023-2024 Stockholder Return Program. All shares repurchased during the three months ended March 31, 2024, were purchased at market price. As of March 31, 2024, we had up to $11.7 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024. The next quarterly cash dividend will be paid on June 13, 2024.

Subsequent to March 31, 2024, from April 1, 2024, through April 19, 2024, we repurchased 5,427,946 shares of our common stock at an average price per share of $160.97 for a total purchase price of $874 million. As of April 19, 2024, we had up to $10.8 billion remaining under the 2023-2024 Stockholder Return Program for repurchases of shares and quarterly dividends through December 31, 2024.

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Note 11 – 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)20242023
Net income$2,374 $1,940 
Weighted-average shares outstanding – basic1,185,298,497 1,219,608,362 
Effect of dilutive securities:
Outstanding stock options, unvested stock awards3,793,522 4,996,336 
Weighted-average shares outstanding – diluted1,189,092,019 1,224,604,698 
Earnings per share – basic$2.00 $1.59 
Earnings per share – diluted$2.00 $1.58