“What a crazy quarter this was,” Mike Sievert, the new CEO at T-Mobile US, said to kick off the operator’s first quarter of 2020 earnings call. Indeed, the operator closed its acquisition of Sprint after a two-year battle, shuffled its executive ranks, and just as it was preparing to reintroduce the combined company with a massive marketing campaign, a global pandemic hit. 

“While the process took way longer than anyone could have imagined, we took advantage of every moment during the approval process for this deal to plan for a rapid integration of these companies and we've hit the ground running,” Sievert said of the Sprint acquisition, adding that the highly-coveted 2.5 GHz spectrum recently acquired as part of that deal has been deployed in Philadelphia and New York.

T-Mobile US also expanded its 5G network running on its low-band 600 MHz spectrum, which was first deployed late last year, by activating 1,600 sites during the quarter and an additional 1,000 sites in April. The operator’s 5G network now covers approximately 215 million people, it said. 

The entirety of its 5G deployments will take about three years to complete, Sievert said, but he added that the operator already made significant progress on most of the site leasing and permitting work during the drawn-out approval process. 

“We think New T-Mobile will have been worth the wait. We believe the merger integration will be smoothly managed. We think their spectrum position gives them a credible story to tell, particularly with enterprise wireless customers, [and] that their 5G network will be the nation’s best,” analysts at MoffettNathanson concluded after the earnings release. 

T-Mobile US continues to spend on 5G and most of their capex on low-band spectrum deployments is already done, the firm said. “Next up is the deployment and integration of Sprint’s 2.5 GHz spectrum, which was, in truth, the cornerstone of the transaction.”

Neville Ray, president of technology at T-Mobile US, said the 2.5 GHz spectrum is a critical piece of its network strategy, particularly on its plan to deploy a fixed broadband service that directly competes with cable companies — an industry that is “the least competitive market in the history of man,” Sievert said. 

“It's going to take us months and into years to get that program fully complete across the nation,” Ray said. “Probably not too much this year, but I'm hopeful that we'll be making some inroads next year and beyond.” Meanwhile, T-Mobile US plans to deploy 2.5 GHz for mobile 5G across “thousands of sites in 2020,” he said.

The operator earlier this week said it plans to activate its standalone (SA) 5G network later this year, and highlighted a series of technological “world firsts” during the last few weeks in anticipation of that goal. 

Analysts at MoffettNathanson noted that the COVID-19 crisis likely impacted T-Mobile US’ ability to spend capex as quickly as previously planned. The operator said it is reevaluating spending, “given the significant uncertainty around the magnitude and duration of any necessary impacts arising from the COVID-19 pandemic,” but didn’t hint at any cutbacks on network spending. 

T-Mobile US warned investors that it expects a negative impact in the range of $450 million to $550 million from COVID-19 during the current quarter. COVID-19 related costs also took a $117 million hit during Q1. It, however, remains confident in its ability to capture more customers as the environment stabilizes.

“While this pandemic is definitely not over, we'll continue to take the necessary steps to support our customers and do what's right for our employees and communities as things start to reopen. This will result in some continued near-term impacts to our business,” Sievert said, according to a Seeking Alpha transcript.

“We know from the past that T-Mobile does disproportionately well in an environment with a larger pool of switchers. We're a proven share taker, and I intend to keep it that way,” he added.

T-Mobile US also said that the purchase of Sprint could deliver up to $43 billion in value for shareholders, and that amid massive shutdowns it’s already making plans to accelerate “retail rationalization,” or the permanent closure of some company-owned stores. 

The company banked $951 million in net income on $8.7 billion in revenue during the quarter, representing a 5% year-over-year increase on both metrics.

The operator has a “huge spectrum advantage,” MoffettNathanson concluded. “We believe T-Mobile will be able to deliver a best-in-class 5G experience that, in turn, will allow them not only to take share in the residential market, but, perhaps more importantly, to also compete for the first time for large enterprise accounts that have historically been the sole property of Verizon and AT&T.”