T-Mobile Adds 1.1M Subs
The waves made earlier this year by T-Mobile US's "Un-carrier" approach to the wireless industry are starting to reach shore. The company reported its second-quarter earnings Thursday and recorded a hefty increase of 1.1 million customers. The carrier's challenger strategy has already made its mark.
T-Mobile reported revenue of $6.23 billion, which increased from $4.68 billion in the year-ago quarter. The revenue jump can be attributed, in part, to its acquisition of MetroPCS, which closed in May. Its earnings for the period, however, dropped 16 percent to $1.1 billion. The operator blamed the earnings drop on increased marketing costs. The service provider has gone full tilt with TV commercials and other forms of advertisements to get its message to consumers.
Of the 1.1 million new customers, fully 685,000 of them are the more profitable postpaid (monthly contract) variety. To put this number into perspective, AT&T Inc., which is twice the size of T-Mobile, added only 550,000 postpaid customers during the second quarter. Sprint Corp. actually lost 1 million postpaid customers during the second quarter. The rest of T-Mobile's customer growth came from the prepaid (pay-as-you-go) market.
These customer additions were surely aided by the arrival of the Apple iPhone 5, which went on sale in April. T-Mobile sold 5 million devices during the second quarter, 4.3 million of which (or 86 percent) were smartphones. T-Mobile sold 1.45 million iPhones, which represented 29 percent of all device sales for the quarter.
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— Eric Zeman, Information Week