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Quarterly earnings round-up – Orange, Telefonica and Sprint

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Orange and Telefonica feel the pinch of roaming charges regulations, while Sprint records highest customers adds in two years, but manages to slip back into a loss.

Orange feels roaming impact but convergence pays off

Orange has said new regulations for roaming charges has slowed growth over the course of the quarter, though the team has reported a 0.9% lift in total revenues on a comparable basis. What this actually means is the team made less money than last year, but if you get creative with the wording it can be made to look good.

Over the course of the last quarter, Orange brought in €10.3 billion in total revenues, which compares to €10.8 billion in the same period of 2016. By playing around with definitions and highlighting certain market conditions, the team are giving an expert lesson on spin. We didn’t realise that €500 million less in revenue was actually 0.9% more. Well, you learn something new every day.

In terms of customer numbers, the convergence is starting to look like it will start to pay off before too long. In France, 59% of customers are on some sort of convergent deal, while this number is at 83% in Spain and 47% in Poland. Churn is down impressively across the board when you compare convergent customers to those with one service, and the year-on-year growth for ARPU with these customers is also nothing to turn your nose down at (9% in France, 12% in Spain and 31% in Poland).

“This quarter demonstrates very good momentum at Orange, supported more than ever by investment in customer experience and our networks,” said CEO Stéphane Richard. “We attracted nearly half a million mobile contract customers and 321,000 fibre customers in France and the Europe segment in the past three months.”

Telefonica says if rules were different we’d make loads of money

Spanish telco Telefonica has said it would have grown by 5% if the European Commission hadn’t introduced new roaming rules which ban operators from holding holiday makers to ransom. Instead revenues declined by 2.5%.

Total revenues were down to €12.7 billion, while operating profit dipped 1.9% to €4.1 billion. Of course, if the rules hadn’t been changed, it would have been positives across the board, but what does that matter. The rules did change, and Telefonica made less cash that last year. Those dastardly bureaucrats over in Brussels; if only they weren’t concerned with giving a fair deal to the consumer, the telcos would be rolling in it. Like ‘pigs in sh*t’, we believe is the phrase.

Sprint add customers, slips into loss and says nothing about merger

T-Mobile decided it was above responded to rumours regarding a merger with Sprint, and Sprint has done the same. This was the only question which most wanted answered, but it was the one avoided like eye contact on the London Underground.

Over the course of the last three months, Sprint managed to add a healthy 378,000 wireless customers to its ranks, but also managed to lose $48 million over the course of the three months. This loss followed a very positive $206 million profit in Q2, but it is certainly better than a $142 million loss in the same quarter of 2016.

“Sprint was able to deliver net additions in both its postpaid phone and prepaid business for the third consecutive quarter,” said CEO Marcelo Claure. “I’m even more proud that the team was able to deliver this customer growth while continuing to attack the cost structure, improve the network, and maintain positive adjusted free cash flow.”


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