Mike Sievert of T-Mobile is the CNN Business CEO of the Year

New York

Investors saw a lot of red in 2022. But a company known for its magenta logo was a stock market darling this year.

Shares of T-Mobile ( TMUS ) rose about 20% in 2022, even as rivals AT&T ( T ) and Verizon ( VZ ) fell. Ma Bell fell about 2% while Verizon ( VZ ) plunged more than 25%.

T-Mobile is now worth about $175 billion, too, more than Verizon and AT&T, both of which are Dow components. T-Mobile’s solid performance on Wall Street was a big reason CEO Mike Sievert is CNN Business’ CEO of the Year pick.

Sievert beat out several other challengers, including Michele Buck of Hershey ( HSY ), Occidental Petroleum’s ( OXY ) Vicki Hollub and Arvind Krishna of IBM ( IBM ). He joins 2021 CEO of the Year selection Albert Bourla of Pfizer ( PFE ) and previous winners Marc Benioff of Salesforce ( CRM ), Target ( TGT ) CEO Brian Cornell and Chipotle’s ( CMG ) Brian Niccol.

T-Mobile had an impressive year despite many financial challenges, including inflation. The company continued to gain market share at the expense of its rivals.

It also spent more money covering the country with increased 5G coverage, and it has made some notable partnerships, including one with Elon Musk’s SpaceX, to try to get more customers.

CNN Business spoke with Sievert about how T-Mobile has continued to perform well in a super-competitive business.

Sievert said the company is aware that “consumers fear inflation.” That’s why T-Mobile is trying to keep prices down, even as competitors have raised the cost of many of their plans because inflation is hurting their profitability.

T-Mobile CEO Mike Sievert speaks to employees at a company event in 2022.

T-Mobile is even continuing to cover the cost of Netflix ( NFLX ) subscriptions for its subscribers following price hikes by the streaming giant.

“It’s just another example of us making a big investment in customers, changing the industry for their benefit, putting them first and investing in them,” Sievert said.

The strategy works. T-Mobile, thanks to its 2020 merger with Sprint, is now the second largest wireless carrier in the US, ahead of AT&T and behind only Verizon.

The company has about 112 million customers and has been adding subscribers at a faster clip than both of its main rivals. A data breach in 2021, for which T-Mobile paid $350 million this year to settle a class-action lawsuit, has also not slowed growth.

But there are some concerns. Sievert said inflation is among them, mainly for the employees. He explained that the company has increased workers’ wages to take account of rising prices. That has led to higher expenses, but Sievert said T-Mobile is less concerned about inflation than other consumer firms.

“We’re somewhat insulated from inflation,” he said, adding that T-Mobile’s average revenue per customer has increased this year not because of price increases, but because of the fact that one of the company’s more popular plans is a higher price . service that offers several functions.

Growing recession concerns are also a problem, although Sievert said “we don’t take it for granted that a recession is coming. But we are prepared if it is.”

Sievert noted that wireless customers are likely to be very reluctant to cut back on using their phones, even if the economy goes south. That could make any downturn next year less of a problem than the Great Recession of 2008-2009 was for cellphone companies.

“We are in a category that people want to keep. This is very different from 2008 before the smartphone revolution. People want to stay on wireless, he said.

It helps that wireless technology is also much more advanced now than it was 14 years ago. Sievert said T-Mobile has also been able to leverage the fact that it has spent heavily on wireless spectrum auctions to fill out the 5G coverage map across the country.

“It’s about multiple devices connecting customers with devices that serve every purpose in their lives, including the rapid growth of 5G home broadband,” Sievert said.

“We feel so fortunate to have this massive multi-year lead on the 5G race in this category,” he noted, adding that T-Mobile was “dead last” in the 4G market not too long ago.

But AT&T and Verizon are both ramping up their 5G coverage plans as well. And let’s be honest. It’s not that much anymore to distinguish one wireless carrier from another. They offer mostly the same new and popular phones from Samsung (SSNLF) and the latest iPhone 14 from Apple (AAPL).

Enter SpaceX. T-Mobile announced a joint venture with Musk’s rocket launch company this year to use SpaceX’s Starlink satellites to provide wireless service in areas with little or no coverage.

“The idea of ​​being able to connect to where you can see the sky, that’s potentially groundbreaking,” Sievert said. “Now we’re trying to create a service that connects your cell phone directly to a satellite,” he said.

Sievert said he and Musk worked together “on multiple occasions” to get the deal right, adding that he was impressed by “how mission-driven” Musk and the entire SpaceX leadership team are.

“You can just feel the passion when you talk to Elon or any senior person at SpaceX, that they believe deeply in the importance of what they’re doing for humanity,” he said.

Sievert, who has been with T-Mobile since 2012, took over as CEO in 2020 from longtime CEO John Legere. Sievert is perhaps a little less bombastic and flamboyant than Legere, who was known for taunting the competition, not to mention his rock star-length hair and penchant for leather jackets.

Sievert is nevertheless confident that the company will continue to grow. To that end, he’s not worried about the fact that cable companies are trying to cash in on the wireless boom, too. Both Comcast ( CMCSA ) and Charter ( CHTR ) have agreements with Verizon to provide cell phone service over Verizon’s network.

Sievert said he respects the competition from cable.

“These are very successful companies that seem very serious about the space,” he said. “But I’d much rather be a mobile company that uses advanced 5G technology to challenge the cable space than the other way around.”

But Sievert is not too worried that they will hinder T-Mobile’s growth.

“Cable has been doing it wireless now for years, and they’ve had some success,” he said. But he added that there has been more at the lower end of the market.

T-Mobile instead wants to continue trying to attract more subscribers who are willing to pay for premium packages. And Sievert said T-Mobile can do that by continuing to market itself as the so-called “un-carrier” that’s different from all of its rivals. That includes the heavy use of the prominent magenta logo.

Sievert even joked about the fact that Pantone just named Viva Magenta the color of the year.

“We are on trend for 2022 and 2023,” he said. “But this has been part of our image for a long time. And what we want people to see at a glance is that our company is a little different than everyone else. This is not a tired and worn-out old phone. This is a technology company who are deeply passionate about what we do.”

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