news


T-Mobile US Q3 sees the ‘un-carrier’ continue customer growth

John Legere, CEO T-Mobile US CEO

Self-styled ‘un-carrier’ T-Mobile US has posted 2014 3rd quarter results showing 9.9% year-on-year revenue growth to $7.35 billion, representing a 2.3% increase on sequential basis. The operator said the quarter is its best yet in terms of branded post-paid net additions and service revenue growth, up in double-digits.

TMUS added a total of 2.3 million new customers in the quarter, including 1.4 million of the more lucrative branded post-paid contracts, bringing the total for the last six months to 10 million added clients. Overall, the operator has 52.9 million customers.

“Despite our competitors’ best efforts, the un-carrier revolution made huge advances in the third quarter with record net new customers,” President and CEO of TMUS John Legere said. “More proof of the resurgent strength of our brand and the massive momentum behind the un-carrier consumer movement.”

The ‘un-carrier’ business model was coined and adopted by TMUS, the smallest of the big four US operators, in 2013. The strategy includes a focus on shorter contracts, free international data roaming, unlimited tablet data, and reimbursing new customers for early-termination-fees when switching to TMUS from other operators.

Claiming to be the first to introduce nationwide VoLTE in the US, the telco last month launched the Wi-Fi Unleashed service, which makes voice and SMS available worldwide over a wifi connection. Post-paid customers are also given the Personal CellSpot device to boost coverage in other areas and to enable sending free texts in-flight (in partnership with Gogo).

TMUS also reported 10.6% growth in year-on-year service revenues to $5.75 billion, and said it has already achieved its 2014 target of covering 250 million Americans, with a target for 2015 to increase this to 300 million people. However, TMUS reported a quarterly loss of $94 million (or 12 cents a share), and adjusted EBITDA margin was down to 24% from 26% in Q3 2013.

The ‘un-carrier’, majority owned by Deutsche Telekom, has recently been eyed-up by several players for take-over but none have so far materialised. French telco Iliad’s bid was rejected by DT twice, and US third largest operator Sprint called off its chase in August, reportedly deterred by regulatory opposition.

The ability to continue to add customers in a market where there is no real growth opportunity in overall subscriber numbers is impressive. However, the last quarter of the year will see possibly the toughest fight for customers, following new device launches and the upcoming holiday season. Since Sprint abandoned its merger ideas, TMUS’ stock has been falling, and it also faces the potential for some serious spending as it prepares for the November US spectrum auction.


Leave a comment

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Polls

What will be the defining telecoms trend in 2018?

Loading ... Loading ...