T-Mobile US reported its “biggest growth quarter” ever in the third quarter of 2014, adding 1.4 million branded postpaid net new accounts, and prepaid net adds of 411,000. The prepaid performance represents growth four times greater than second quarter prepaid results.
T-Mobile US says it has added 10 million total customers over the last six quarters, and 2.3 million in the third quarter alone.
Service revenues grew 10.6 percent year-over-year to $5.7 billion, while average billings per user (a figure that includes recurring service revenue and installment plan revenue for devices) reached $61.59, up 4.2 percent year over year.
As you might expect, for a firm in a major promotional push lead by price attacks, adjusted earnings (EBITDA) of $1.35 billion was flat year over year.
T-Mobile US ended the third quarter of 2014 with 52.9 million total customers, an increase of 2.3 million total customers from the end of the second quarter of 2014.
Total smartphone sales, including sales to branded postpaid and prepaid customers, were 6.9 million units in the third quarter of 2014, or 93 percent of all phone units sold.
Service revenues for the third quarter of 2014 grew by 10.6 percent year over year. In the second quarter of 2014, service revenue grew by 7.1 percent.
On a sequential basis, service revenues grew by 3.6 percent. T-Mobile grew total revenues in the third quarter of 2014 by 9.9 percent year over year. On a sequential basis, total revenues increased by 2.3 percent.
Branded postpaid phone ARPU increased sequentially by 1.1 percent to $49.84. Branded prepaid ARPU increased by 5.3 percent year over year to $37.59, T-Mobile US reports.
Branded postpaid phone churn was 1.6 percent a month in the third quarter of 2014.
Branded postpaid net customer additions for 2014 are now expected to be between 4.3 and 4.7 million, up significantly from the prior guidance of three to 3.5 million, T-Mobile US now forecasts.
For the full year of 2014, T-Mobile expects adjusted EBITDA to be in the range of $5.6 to $5.8 billion, unchanged from the prior guidance. Based on T-Mobile US predictions, that adjusted EBITDA will be “at the very low end of the range,” that suggests a belief that earnings will be close to $5.6 billion for the full year.
T-Mobile US performance was significant for other reasons. AT&T, in the same quarter, added about two million net new accounts. Of note, about 1.27 million of those connections were tablets.
Postpaid net phone additions were 785,000.
So T-Mobile is adding phone accounts, and AT&T mostly tablet accounts, on a net basis.
Mobile segment operating margins dropped to 24.6 percent, compared with 26.4 percent, year over year, suggesting the impact of the mobile marketing war.
Verizon added 1.53 million retail net connections, but only 457,000 phone accounts. The other 1.1 million net additions were tablet connections.
Whatever else you might say, T-Mobile US is adding the most net new phone accounts, assuming Sprint third quarter net adds are about as expected.
Edited by
Rory J. Thompson 
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