T-Mobile Launches $140/Month Better Value Plan with Five-Year Price Guarantee
T-Mobile will roll out its Better Value family plan on January 14, offering three lines at $140 per month ($46 per line) with a five-year price guarantee on talk, text and data. The plan bundles unlimited 5G data, 250 GB hotspot, 30 GB international data, satellite connectivity and streaming benefits, promising over $1,000 in savings versus AT&T and Verizon.
1. T-Mobile Shifts Into Cash-Generation Mode
In 2026 T-Mobile US completed the capex-heavy build-out of its nationwide 5G network and is now capitalizing on that investment with robust free cash flow generation. During the fourth quarter, the company reported consolidated operating cash flow of $5.1 billion, up 18 percent year-over-year, while capital expenditures declined to $2.6 billion as network deployments wind down. Management projects full-year 2026 free cash flow of $12 billion, up from $9 billion last year, providing ample liquidity for debt reduction, share repurchases and strategic broadband investments. Investors will be watching margin expansion in the wireless segment—gross margins rose to 60.2 percent in Q4—and the ramp of home internet subscribers, which increased 35 percent to 2.8 million users.
2. $2.0 Billion Senior Notes Offering Strengthens Balance Sheet
T-Mobile USA announced a registered public offering of $1.15 billion in 5.000 percent senior notes due 2036 and $0.85 billion in 5.850 percent senior notes due 2056. Proceeds will be used to repay commercial paper and refinance maturing debt, extending the company’s weighted-average debt maturity to 10.2 years. Following the deal, total debt to adjusted EBITDA is expected to decline to 2.4x from 2.6x at year-end 2025. The offering attracted over $4 billion in orders, reflecting strong investor demand for T-Mobile’s investment-grade credit profile and cash-flow visibility.
3. Better Value Plan Aims to Boost ARPU and Reduce Churn
On January 14 T-Mobile rolled out its new ‘Better Value’ family plan, pricing three lines at $140 per month (approximately $46 per line, pre-taxes and fees) with AutoPay. The plan includes unlimited premium 5G data, 250 GB of high-speed mobile hotspot, 30 GB of high-speed roaming in North America plus 30 GB abroad, satellite-optimized connectivity, and a five-year price guarantee on talk, text and data. T-Mobile estimates the enhanced plan will generate a 3 percent increase in blended ARPU over the next 12 months while reducing postpaid churn by 10 basis points, as existing customers on three-line families upgrade from Essentials and new switchers lock in long-term pricing stability.