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.
This article is over a month old, voting and posting comments is disabled
2/28/2013 3:36:56 PM
T-Mobile needs to worry about offering 3G speeds in areas that cannot get 4G. When I singed up for t-Mobile, I looked at the coverage, and thought to myself "its ok, I don't really need 4G for the price savings". Problem is, T-mobile does not tell you that if you are not in a 4G area, you get edge speeds, which is basically 2G. That is unacceptable on a smartphone!!
2/28/2013 5:28:57 PM
Their "4G" is just 3G at 10-44mbps. Basically the whole network is upgraded from the base 3G speed months ago.
I'm in a town where one side of it I got 300-500kbps down and 800 up and the other side I got 8000kbps down and around 1000 up.
Outside town? 2G to nothing.
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