Telecom Operators

T-Mobile posts strong results adding 1.3m new customers

T-Mobile US posted strong results this quarter despite the fact that its competition went big on unlimited offers. The operator reported record low customer attrition and said it was considering a quarterly dividend.

Chief Financial Officer Braxton Carter said, "We're actually starting to have conversations about instituting a small quarterly dividend that we can grow in the future.”

Q2 2017 was a record-breaking quarter in a number of areas for T-Mobile, the company states. The operator delivered record service revenue, strong net income, record Adjusted EBITDA and record-low postpaid phone churn. T-Mobile added 1.3 million total customers, marking 17 straight quarters of adding more than 1 million every quarter.

The company expects to capture all of the industry's postpaid phone growth with 786,000 branded postpaid phone customers in the quarter. Customers are also staying longer, T-Mobile claims, reflected in its record-low branded postpaid phone churn of 1.10% in Q2 2017.

As a result of these strong customer metrics, T-Mobile grew service revenues to record levels, up 8% year-over-year in Q2 2017, it claims. The operator’s consistent level of outperformance has seen it gaining share from larger competitors AT&T and Verizon in a saturated US market through its network improvements and lower prices.

The company had said it was open to various strategic options and has acknowledged it would consider talks with rival Sprint about a potential merger, Reuters reported. However, discussions appear to be on hold, as Sprint, owned by Japan’s SoftBank, is also in negotiations with cable companies Charter Communications and Comcast.

T-Mobile’s net income rose to $581 million, or 67 cents per share, from $225 million, or 25 cents per share, a year earlier. Total revenue grew to $10.21 billion from $9.29 billion. The operator toppled analyst predictions of 38 cents per share on revenue of $9.81 billion, according to Thomson Reuters I/B/E/S.

"We just delivered a quarter with record service revenue, record-low churn, strong net income and record Adjusted EBITDA - all while leading the industry in postpaid phone growth," said John Legere, President and CEO of T-Mobile.

"On top of that, our network just keeps getting better and faster while the Duopoly's networks seem to be choking after we forced them to go unlimited. Make no mistake about it, the Un-carrier will not stop forcing change in this industry and our Q2 results are more proof that consumers are responding!"

What is a Un-carrier? T-Mobile defines the model as “listening to customers, solving their pain points and giving them unmatched value.” Focusing on these simple priorities has “completely disrupted the wireless industry” T-Mobile claims, “and forced the competition to respond to our moves.”