T-Mobile (TMUS) is facing record-high consumer demand despite recently hiking its prices. This move has frustrated customers to the point where some have even threatened to cut ties with the company.
In T-Mobile’s first-quarter earnings report for 2025, the company revealed that it added 1.3 million postpaid customers, which is the best result it has ever achieved during any first quarter of a year.
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T-Mobile specifically added 495,000 new postpaid phone customers and 424,000 new high-speed internet customers, which contributed to the company generating a net income of $3 billion, 24% higher than what it earned during the same quarter in 2024.
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“A record number of customers chose the Uncarrier in Q1 — we grew postpaid gross additions year-over-year across the board and our High Speed Internet business led the industry in net customer additions for the 13th straight quarter,” said T-Mobile CEO Mike Sievert in the report.
This increased consumer momentum comes after the phone carrier implemented a $5 price hike for some of its older phone plans earlier this month.
A few weeks later, T-Mobile also increased its Regulatory Programs & Telco Recovery Fee from $3.49 to $3.99 for voice lines and from $1.40 to $1.60 for data-only lines, further frustrating customers.
“Taking on something big on the tariff front is just not something our business model is interested in trying to do,” said T-Mobile’s CEO.
Image source: Anna Moneymaker/Getty Images
T-Mobile has harsh news for customers
Despite generating increased profits during the first few months of the year, T-Mobile is contemplating a significant pricing change in response to a growing threat.
On April 2, Trump announced a 10% “baseline” tariff on all countries importing goods to the U.S., with roughly 60 countries seeing higher tariff rates. Tariffs are taxes companies pay to import goods from overseas, and the extra cost is often passed down to consumers through price hikes.
However, on April 9, he switched gears and enforced a 90-day pause on reciprocal tariffs on all countries (except China), dropping them to a universal rate of 10%. He also unexpectedly hiked tariffs on China to 145%.
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During an earnings call on April 25, Sievert said that Trump’s tariffs are “hard to predict right now,” and if they affect phone manufacturing, T-Mobile customers will “wind up bearing the cost.”
“We certainly understand the goals of the administration,” said Sievert. “It’s not clear how much this (tariff policy) is going to affect the handset market. I think to the extent that it does land, and if it’s a material thing, ultimately, I think we’re going to see that the customer is going to wind up having to bear that cost. Taking on something big on the tariff front is just not something our business model is interested in trying to do or able to try to do.”
He acknowledged that raising phone prices could cause the company to see “a slowdown in upgrade rates.”
T-Mobile notices change in customer behavior
As Trump doubles down on his tariff plan, Americans across the country have been rushing to purchase new electronic devices to avoid paying inflated prices that could result from tariffs.
According to a survey from CNET in March, 33% of U.S. adults have felt pressured to make tech purchases due to fear of potential price hikes from tariffs, while one in five adults have already made a purchase.
Amid this trend, T-Mobile is already noticing a slight boost in the number of customers upgrading phones and switching phone providers.
“I think there’s a certain element out there where people are in a time of uncertainty about the future, grabbing what they can afford now,” said Sievert.
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While Sievert made it clear during the call that T-Mobile isn’t afraid to pass down tariff costs to its customers, he also addressed the company’s most recent price increase.
He said that the change affected “some customers,” impacting millions of legacy rate plans, and customers “understand” and have accepted these price hikes.
“What we are out there doing right now is really just completing a project that we started last year to get after some long outdated plans,” said Sievert. “First price increase of this kind in more than a decade. And I think because of that, our customers have a lot of acceptance of it. I think they understand, especially since we take our time in a ‘test and learn’ method…and explain to them what’s behind it.”
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