Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Statement of Comprehensive Income
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Net Profit Margin since 2013
- Return on Assets (ROA) since 2013
- Debt to Equity since 2013
- Price to Earnings (P/E) since 2013
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Profitability Ratios (Summary)
T-Mobile US Inc., profitability ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The profitability metrics demonstrate a consistent and significant improvement over the five-year period. Increases are observed across all reported ratios, indicating enhanced operational efficiency and financial performance.
- Gross Profit Margin
- The gross profit margin exhibited an initial modest increase from 54.31% in 2021 to 54.50% in 2022. Subsequently, a substantial rise is noted, reaching 61.57% in 2023, followed by 63.57% in 2024. The metric experienced a slight decrease in the most recent year, settling at 62.89% in 2025, though remaining considerably higher than the earlier values.
- Operating Profit Margin
- The operating profit margin initially decreased slightly from 8.60% to 8.22% between 2021 and 2022. However, a strong upward trend commenced in 2023, with the margin increasing to 18.16%. This positive momentum continued into 2024, reaching 22.13%, before moderating to 20.70% in 2025. Despite the recent moderation, the operating profit margin remains significantly elevated compared to the 2021 and 2022 figures.
- Net Profit Margin
- Similar to the operating profit margin, the net profit margin experienced a slight decline from 3.77% in 2021 to 3.25% in 2022. A marked improvement followed, with the margin climbing to 10.59% in 2023 and further increasing to 13.93% in 2024. The most recent year shows a slight decrease to 12.45%, but the net profit margin still represents a substantial improvement over the earlier periods.
- Return on Equity (ROE)
- The return on equity demonstrated a consistent upward trajectory. Starting at 4.38% in 2021, ROE increased to 3.72% in 2022. A significant jump occurred in 2023, reaching 12.85%, and continued into 2024 with a value of 18.37%. The metric stabilized in 2025 at 18.57%, indicating sustained profitability relative to shareholder equity.
- Return on Assets (ROA)
- The return on assets followed a similar pattern of improvement. From 1.46% in 2021 and 1.23% in 2022, ROA rose to 4.00% in 2023 and 5.45% in 2024. The most recent year shows a slight decrease to 5.01%, but the ROA remains considerably higher than the initial values, suggesting improved efficiency in utilizing assets to generate profits.
Overall, the observed trends indicate a strengthening of profitability across all measured ratios. The period between 2022 and 2024 was particularly notable for substantial gains, with a slight moderation in performance occurring in 2025. The company appears to be effectively managing its costs and generating higher returns on both equity and assets.
Return on Sales
Return on Investment
Gross Profit Margin
T-Mobile US Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross profit | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Gross profit margin1 | ||||||
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| AT&T Inc. | ||||||
| Verizon Communications Inc. | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The gross profit margin exhibited a generally positive trend over the five-year period. While gross profit demonstrated fluctuations, the gross profit margin consistently increased before stabilizing. A detailed examination of the trends is presented below.
- Gross Profit
- Gross profit remained relatively stable between 2021 and 2022, experiencing a slight decrease from US$43,513 million to US$43,365 million. A notable increase occurred between 2022 and 2023, rising to US$48,370 million. This upward trajectory continued through 2024, reaching US$51,747 million, and further increased to US$55,535 million in 2025. This indicates a strengthening ability to generate profit from core operations.
- Revenues
- Revenues experienced a minor decline from US$80,118 million in 2021 to US$79,571 million in 2022. A further decrease was observed in 2023, with revenues falling to US$78,558 million. Revenues then rebounded in 2024, increasing to US$81,400 million, and continued to grow significantly in 2025, reaching US$88,309 million. The revenue growth in the later years appears to be driving the increase in gross profit.
- Gross Profit Margin
- The gross profit margin began at 54.31% in 2021 and increased slightly to 54.50% in 2022. A substantial increase was observed in 2023, with the margin rising to 61.57%. This positive trend continued into 2024, reaching 63.57%. In 2025, the gross profit margin experienced a slight decrease to 62.89%, though it remained significantly higher than the levels observed in 2021 and 2022. The increase in the gross profit margin suggests improved efficiency in managing the cost of goods sold relative to revenue, or a shift towards higher-margin products or services.
Overall, the observed trends indicate a strengthening financial performance, particularly in terms of profitability. The increase in gross profit margin, despite fluctuations in revenue, suggests effective cost management and/or a favorable shift in the revenue mix.
Operating Profit Margin
T-Mobile US Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| AT&T Inc. | ||||||
| Verizon Communications Inc. | ||||||
| Operating Profit Margin, Sector | ||||||
| Telecommunication Services | ||||||
| Operating Profit Margin, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The operating profit margin exhibited a notable upward trend over the observed period. Initial values were relatively stable before a significant increase, followed by a slight moderation in the most recent year.
- Operating Profit Margin - Trend Analysis
- In 2021, the operating profit margin stood at 8.60%. A modest decrease was recorded in 2022, with the margin declining to 8.22%. However, 2023 witnessed a substantial improvement, with the operating profit margin increasing to 18.16%. This positive momentum continued into 2024, reaching a peak of 22.13%. The most recent year, 2025, saw a slight decrease to 20.70%, though the margin remained significantly higher than the levels observed in 2021 and 2022.
The increase in operating profit margin suggests improved operational efficiency or pricing power. The substantial gains in 2023 and 2024 likely reflect successful cost management strategies or increased revenue relative to operating expenses. The slight decline in 2025, while still representing a strong margin, warrants further investigation to determine the underlying causes. This could be due to increased competition, rising input costs, or strategic investments impacting short-term profitability.
- Relationship to Revenue
- Revenues experienced a slight decrease in 2022, followed by increases in 2024 and 2025. However, the growth in operating income significantly outpaced revenue growth, particularly between 2022 and 2024, contributing to the observed expansion of the operating profit margin. The continued revenue growth in 2025, coupled with a relatively stable operating income, resulted in a minor decrease in the operating profit margin.
Overall, the operating profit margin demonstrates a positive trajectory, indicating strengthening financial performance. Continued monitoring of this metric, alongside a detailed analysis of revenue and operating expense components, is recommended to sustain profitability and identify potential areas for improvement.
Net Profit Margin
T-Mobile US Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| AT&T Inc. | ||||||
| Verizon Communications Inc. | ||||||
| Net Profit Margin, Sector | ||||||
| Telecommunication Services | ||||||
| Net Profit Margin, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The net profit margin exhibited significant fluctuations over the five-year period. Initially, a decline was observed, followed by substantial improvement and a subsequent slight decrease.
- Net Profit Margin Trend
- In 2021, the net profit margin stood at 3.77%. This decreased to 3.25% in 2022, indicating a reduction in profitability relative to revenue. A dramatic increase occurred in 2023, with the net profit margin rising to 10.59%. This positive trend continued into 2024, reaching a peak of 13.93%. However, in 2025, the net profit margin experienced a modest decline to 12.45%, though remaining significantly higher than the 2021 and 2022 levels.
The substantial increase in net profit margin from 2022 to 2024 suggests improved operational efficiency, effective cost management, or a favorable shift in revenue mix. The slight decrease in 2025, while not negating the overall positive trend, warrants further investigation to determine the underlying causes. These could include increased operating expenses, changes in pricing strategies, or shifts in the competitive landscape.
- Relationship to Net Income and Revenues
- The net profit margin’s trajectory closely mirrors the changes in net income. While revenues experienced a slight decrease between 2021 and 2023, net income increased substantially, driving the margin higher. The revenue increase in 2024 and 2025 was accompanied by continued strong net income, though the rate of net income growth slowed in 2025, contributing to the marginal decline in the net profit margin.
Overall, the company demonstrated a strong ability to improve profitability, as evidenced by the significant increase in net profit margin from 2022 to 2024. The slight decrease in 2025 does not necessarily indicate a negative trend, but rather suggests a need for continued monitoring of factors influencing profitability.
Return on Equity (ROE)
T-Mobile US Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income | ||||||
| Stockholders’ equity | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| AT&T Inc. | ||||||
| Verizon Communications Inc. | ||||||
| ROE, Sector | ||||||
| Telecommunication Services | ||||||
| ROE, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
The analysis reveals a significant fluctuation in Return on Equity (ROE) over the five-year period. Initially, ROE experienced a decline, followed by substantial growth and subsequent stabilization.
- Net Income Trend
- Net income demonstrated a decrease from US$3,024 million in 2021 to US$2,590 million in 2022. However, a marked increase occurred in 2023, reaching US$8,317 million, and continued to rise to US$11,339 million in 2024. A slight decrease to US$10,992 million was observed in 2025.
- Stockholders’ Equity Trend
- Stockholders’ equity exhibited a modest increase from US$69,102 million in 2021 to US$69,656 million in 2022. Subsequently, a downward trend was observed, decreasing to US$64,715 million in 2023, US$61,741 million in 2024, and further to US$59,203 million in 2025.
- Return on Equity (ROE) Analysis
- ROE began at 4.38% in 2021 and decreased to 3.72% in 2022, mirroring the decline in net income. A substantial increase in ROE was then recorded in 2023, reaching 12.85%, driven by the significant growth in net income coupled with the decrease in stockholders’ equity. This upward trajectory continued into 2024, with ROE reaching 18.37%. ROE stabilized in 2025 at 18.57%, indicating a consistent level of profitability relative to equity.
- The increase in ROE from 2022 to 2025 suggests improved efficiency in utilizing shareholders’ investments to generate profits. The stabilization in 2025 implies that the company has maintained this improved efficiency.
The combined trends indicate that while net income initially decreased, its subsequent and substantial growth, alongside a concurrent decrease in stockholders’ equity, resulted in a significant improvement in ROE. The stabilization of ROE in the most recent year suggests a sustained level of profitability.
Return on Assets (ROA)
T-Mobile US Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| AT&T Inc. | ||||||
| Verizon Communications Inc. | ||||||
| ROA, Sector | ||||||
| Telecommunication Services | ||||||
| ROA, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The Return on Assets (ROA) exhibited a notable upward trend over the observed period. Initially, the ROA demonstrated a decline, followed by substantial improvement and subsequent stabilization.
- Net Income Trend
- Net income fluctuated considerably. It decreased from US$3,024 million in 2021 to US$2,590 million in 2022, before experiencing a significant increase to US$8,317 million in 2023. This positive momentum continued into 2024, reaching US$11,339 million, and then experienced a slight decrease to US$10,992 million in 2025.
- Total Assets Trend
- Total assets remained relatively stable throughout the period. A modest increase was observed from US$206,563 million in 2021 to US$211,338 million in 2022. A slight decrease followed in 2023 to US$207,682 million, with minimal change in 2024 (US$208,035 million). A more substantial increase was noted in 2025, reaching US$219,237 million.
- ROA Analysis
- The ROA began at 1.46% in 2021 and decreased to 1.23% in 2022, mirroring the decline in net income. However, the ROA experienced a dramatic increase in 2023, reaching 4.00%, driven by the substantial growth in net income. This upward trajectory continued into 2024, with the ROA reaching 5.45%. In 2025, the ROA experienced a slight decrease to 5.01%, despite continued high net income, likely due to the increase in total assets. The ROA demonstrates a strong correlation with net income, indicating that profitability is a key driver of asset utilization efficiency.
Overall, the company demonstrated improving efficiency in generating profits from its assets, particularly from 2023 onwards. While the ROA experienced a slight moderation in 2025, it remained at a significantly elevated level compared to the earlier years of the period.