T-Mobile Sees Earnings Plunge, Loses 500K Subscribers
February 28, 2013 12:58 PM
comment(s) - last by
Company brags about its "momentum", but financials suggest otherwise
In its Q4 2012
Deutsche Telekom AG's (
) T-Mobile USA brags, "As T-Mobile USA, Inc. (“T-Mobile”) closed out its fourth quarter, the Company continued to generate business momentum by executing its Challenger strategy, while laying the groundwork for its unique ‘Un-carrier’ initiatives aimed at changing the rules of wireless."
But for all the talk of "changing the rules" and gaining "momentum", the actual numbers
continue to look pretty grim.
For the quarter T-Mobile USA lost 515,000 contract customers. Operating income (OBIDA) fell to $1B USD, down 25 percent from a year ago. Total revenue fell from $5.2B USD in Q4 2011 to $4.9B USD.
continues to be a strong point for T-Mobile, much like Sprint Nextel Corp. (
), but the addition of 166,000 prepaid customers in Q4 was not enough to stop the revenue bleed from defecting contract customers.
One factor that may help T-Mobile is its pickup of the Apple, Inc. (
) iPhone. Some customers may be attracted to the
prospect of the Apple device
on T-Mobile's lower priced plans.
T-Mobile says that its
merger with MetroPCS
should be wrapped up in April. The company can only hope that the merger with the more-successful budget carrier will provide it the spark it so desperately needs.
One big issue for T-Mobile is its lack of LTE. Like Sprint, T-Mobile is stuck playing catch-up with respect to true 4G. The company says it is "accelerating" its deployment and will cover 100 million Americans with LTE by "mid-2013". It plans to cover 200 million Americans with LTE by the end of the year.
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RE: Not the best...But
2/28/2013 1:26:55 PM
I did the exact same thing and feel the same way (even came from a similarly ludicrous VZ plan, though mine was a grandfathered unlimited which made it a bit harder to leave behind.) I've read many similar accounts and think that T-mobile really needs to keep pushing this to succeed. LTE will be nice, but like you I get ~15Mbps down and am fine without it. What they really need is to expand their coverage as they roll out their LTE. At that point, they will look great next to the other carriers.
RE: Not the best...But
2/28/2013 4:31:35 PM
You want an even better deal, bought the same phone last week during their $50 Nexus 4 sale, they waived the $35 activation fee and the contract cancellation fee was only $200.
So I get the same Nexus 4 unlocked for only $250, no tax or shipping costs. The only additional I had to pay was one month of service at $60 versus $30.
RE: Not the best...But
2/28/2013 4:34:33 PM
Also check out Solavei $49 unlimited on T-Mobiles network.
"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA
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