Impressive quarterly performance keeps Sprint ahead of T-Mobile in US mobile market.

Iain Morris, International Editor

January 8, 2015

3 Min Read
Sprint Holds off T-Mobile US Offensive

It's probably only a matter of time before T-Mobile overtakes Sprint to become the third-biggest US mobile operator, but it is not yet a "done deal" -- as T-Mobile CEO John Legere put it earlier this week -- after Sprint turned in its best performance in three years in the final quarter of 2014.

A day after T-Mobile US Inc. offered the market a sneak preview of its results for the October-to-December quarter, Sprint Corp. (NYSE: S) followed suit to prove that its recent marketing efforts have not been in vain. (See T-Mobile Beats Customer Growth Targets.)

Thirty thousand postpaid net additions in the recent quarter might not sound all that impressive, given that T-Mobile signed up 1.3 million postpaid customers over the same period. But it's quite a turnaround considering that Sprint lost 336,000 postpaid customers between July and September.

The operator also reported success on the prepaid front, adding 410,000 customers (on its Sprint platform) between October and December after losing 20,000 in the preceding quarter.

T-Mobile

Sprint (on Sprint platform)

Postpaid adds Q4

1,300,000

30,000

Postpaid adds Q3

1,379,000

-336,000

Postpaid customers Q4

27,209,000

29,495,000

Prepaid adds Q4

266,000

410,000

Prepaid adds Q3

411,000

-20,000

Prepaid customers Q4

16,316,000

15,160,000

Retail adds Q4

1,566,000

440,000

Retail adds Q3

1,790,000

-356,000

Retail customers Q4

43,525,000

44,655,000

Source: Sprint, T-Mobile

"Sprint's first priority is a return to customer growth and our results during the last quarter show we are on the right track," said Marcelo Claure, Sprint's CEO, in a company statement. "While we still have work to do, it is clear that our aggressive actions to provide customers with the best value in wireless are gaining momentum."

Sprint has been responding to T-Mobile's aggressive campaign to build market share, simplifying its pricing plans and slashing tariffs for customers abandoning AT&T Inc. (NYSE: T) or Verizon Communications Inc. (NYSE: VZ) to join its network.

That counter-attack may have taken its toll on earnings, however, with analysts becoming increasingly concerned about the impact of a price war on industry profitability.

Both Sprint and T-Mobile have yet to say anything about sales and profits in the fourth quarter, while bigger rivals AT&T and Verizon have yet to provide any insight into their recent performance.

Moreover, Sprint still seems to be losing "phone" customers on postpaid deals, enjoying growth because of interest in tablet-based mobile broadband offers.

In its statement, the operator said it had "exited the quarter strong on the heels of [its] offers, nearly reaching postpaid phone net additions in December."

Nevertheless, the preliminary results show that Sprint is not prepared to relinquish its number-three spot in the mobile market without a fight.

Earlier this week, it revealed it had raised as much as $1.8 billion in vendor funding for the rollout of its Spark-branded 4G LTE service, and that should help it to maintain its new-found momentum on subscriber growth in the next few months. (See Sprint Signs $1.8B in Vendor Financing Deals .)

Legere's mission just got a little bit harder.

— Iain Morris, News Editor, Light Reading

About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like