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John Legere is above talking about rumours

Legere 10_07_2015

With the quarterly bonanza just about to kick off, it wouldn’t be the same if there wasn’t a bit of eccentricity from T-Mobile US. And he delivered again, this time refusing to do a live earnings call.

Few companies in the telco space would be able to get away with such a move, but T-Mobile CEO John Legere seemingly can. Who knows whether it is because we are used to the out-of-the-ordinary from the magenta army boss, or if the figures allow him to do whatever he wants, but shunning a live investor earnings call is a bold move.

“We decided we wanted to make sure you all saw and focused on our Q3 results and not just the rumours and speculation that seem to fill the news every day,” said Legere. “What better way to do that than to do a video blog?”

I’m the boss, Legere is seemingly saying, if I don’t want to do an earnings call I won’t. And to be completely honest, we probably won’t be missing much. Yes, there certainly would have been a few questions around the performance of the business, but most would have been prodding and prying for some sort of clue regarding a potential deal with Sprint. And funnily enough, Sprint has also decided to ditch the live call as well. Read into that what you will.

But without cracking out the crystal ball, one thing is clear from this move; Legere does not want to answer questions on any deal. The CEO is stamping his authority, and offering zero wiggle room. This is the John Legere show and no-one is going to be given the opportunity to take it off-script. Perhaps one question which might be worth asking is whether such a seemingly authoritarian approach is taken to management in the T-Mobile offices?

A tangent, but nonetheless, an interesting one to ponder. Perhaps Legere isn’t the friendly, eccentric maverick which we have come to know through social media. Perhaps he roams the magenta-tinted hallways of the T-Mobile offices smashing around his iron fist, crushing any wisps which don’t align with John’s law. Who knows.

Onto the actual performance of the business over the third quarter, it was pretty good. Service revenues of $7.6 billion, up 7% year-on-year, $10 billion in total revenues, up 8% y-o-y, net income of $550 million, up 50% y-o-y and free cash flow of $921 million, up 59% y-o-y. Considering the industry is supposed to be going through a bit of a slump, you certainly wouldn’t complain about these numbers.

“Back when we started the Uncarrier journey in 2013, we said customer growth would lead to revenue growth, and eventually EBITDA growth, and ultimately free cash flow,” said Legere. “Well these results make that pretty obvious.”

On the customer side of things, the team is claiming 1.3 million total net additions for the quarter, the 18th straight quarters of adding more than 1 million, 817,000 of which were branded postpaid, and a 1.23% postpaid phone churn. Everything seems to be on the up, which is unusual for the telco industry.

“What’s the difference?” said Legere. “We actually like our customers. It’s simple, but it’s something the duopoly (referring to AT&T and Verizon) just doesn’t seem to understand.”

Doing a pre-recorded video for the earnings call might be a bit unusual, and it might well have irritated some of the more traditional people with money plugged into the business, but as long as Legere is able to continue to report numbers like this, very few will complain.


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