T-Mobile Sees Earnings Plunge, Loses 500K Subscribers
February 28, 2013 12:58 PM
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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
Dr. Kenneth Noisewater
Dr. Kenneth Noisewater
3/2/2013 8:39:44 PM
I had that for awhile with a Galaxy Nexus, but found that the reception in the area I moved to later on was quite poor. In my old house I would get a bar of 3G, but once I moved further away I could only get GPRS (not even EDGE!).
I switched to Ting and got a Galaxy Note 2, and am now seeing 3 bars of 3G at my new semi-rural house, and 4G LTE in nearby cities and towns. Oh, and paying even less per month than the TMobile "unlimited" plan, since I only use about 450-499MB/mo of mobile data (I glom onto wifi a LOT).
"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer
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