T-Mobile ended 2025 on a bittersweet note, seeing both growth and challenges. While the carrier added hundreds of thousands of new wireless customers over the holidays, it also saw a drop in customer loyalty. As T-Mobile battles headwinds, it has launched a free offer to secure and maintain phone customers.
In the last three months of 2025, T-Mobile saw 962,000 new postpaid phone customers join its network, according to its fourth-quarter earnings report for the year.
Despite this gain, the carrier saw its postpaid phone churn, the percentage of those customers who ended their service, reach 1.02%, which is higher than the 0.89% churn it reported for this segment in the third quarter.
The decline in customer loyalty follows T-Mobile’s price hikes earlier in the year, which sparked backlash. During the summer, it also began excluding taxes and fees from its phone plan pricing and pushed select customers off of older phone plans.
It is no surprise that T-Mobile saw elevated churn during the quarter. A survey from WhistleOut last year found that 58% of T-Mobile, AT&T and Verizon customers are considering switching to a different phone carrier as prices rise. Due to this trend, all three companies risk losing a combined 230 million customers.
Mobile virtual network operators (MVNOs), which typically offer cheaper phone plans than traditional carriers, have grown to become a major threat, with 34% of T-Mobile, AT&T and Verizon customers planning to switch to them within the next year.
Wireless consumers have also been flocking to cable companies for their bundled phone, TV and internet offers. For example, during the fourth quarter of 2025, Spectrum gained 428,000 new mobile customers, while Comcast added 364,000.
T-Mobile launches free phone offer to win back customers
To help discourage more customers from leaving, T-Mobile has dropped a new trade-in offer. The carrier is offering customers who trade in an eligible old phone a free iPhone 17, which is usually priced at $830 for the 256GB model and $1,030 for the 512 GB model.
The catch is that customers need to open a new line on an Experience Beyond or Experience More plan to get the free phone. Customers who join T-Mobile’s new Better Value plan can also receive the offer, but they need to add three new lines.
Those on a qualifying plan can also land the deal by adding a new line, provided they trade in an eligible device.
Related: T-Mobile drops 2 new phone plans to stop customers from fleeing
It is important to note that customers who accept the offer must still pay a $35 activation fee. They will also receive bill credits for 24 months equal to the cost of the iPhone 17.
For customers who want deals on iPhone 17 Pro models, T-Mobile is also offering the iPhone 17 Pro, which retails for $1,099, for free. Customers are required only to be on an Experience Beyond plan and to trade in an eligible device.
With those same conditions, the carrier is also selling the iPhone 17 Pro Max for a little over $4 per month.
Consumers remain cautious about “free” phone offers
T-Mobile’s latest iPhone 17 deals rival those of AT&T and Verizon, which are also offering free iPhone 17 trade-in promotions. However, these offers come during a time when most Americans are not keen on upgrading their phones through trade-in deals.
On average, Americans upgrade their phones every 29 months, according to a recent survey from Reviews.org. When Americans upgrade these devices, 47% pay the full cost up front, while 36% finance their smartphones through their phone carrier.
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Only about 6% of Americans are willing to upgrade their phones through a trade-in deal or a better contract.
While T-Mobile and other phone carriers aim to attract customers with “free” phone offers, consumers across the country are often misled by these deals and the unlimited data plans that often accompany them, according to a recent survey from Consumer Cellular.
How many U.S. consumers are misled by “free” phone offers:
- About 27% of U.S. adults, roughly 73 million Americans, took a “free” or “on us” phone deal without fully understanding the terms or required commitments.
- Additionally, 90% of wireless consumers believe most people don’t grasp the true cost or contract details behind these “free” phone promotions.
- Among consumers aged 50 and older, 79% have unlimited plans or use less data than allowed, indicating many may be overpaying for unused data.
Source: Consumer Cellular
Consumer Cellular CEO Ed Evans said in an interview with ABC 11 that these “free” phones aren’t actually free for customers, as they are paying for them through their monthly plans.
“Most of the carriers require you to actually sign up for their most expensive, unlimited plan and in fact, consumers aren’t using that much data,” said Evans.
As free phone offers in the telecom industry face criticism, T-Mobile CEO Srini Gopalan said during an earnings call earlier this month that the company will re-evaluate how it offers phone discounts (or subsidies) to customers in the near future.
“On subsidies, we will always be competitive with phones,” said Gopalan. “It’s really changing the center of gravity of the conversation to stuff that creates sustained value.”
Related: Verizon plans to walk back controversial policy after backlash
