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T-Mobile US Expands in Retail, Focus on Postpaid Division
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Though we are just in the first week of January, U.S. national wireless carrier T-Mobile US Inc. (TMUS - Free Report) has allowed us a sneak peek into its fourth-quarter results, prior to the scheduled release.
T-Mobile US expects to witness strong postpaid subscriber growth in the upcoming quarter in comparison to the third quarter of 2016. The company officials believe that the deployment of low-band spectrum and the ongoing buildout of its retail presence are the primary factors that will drive momentum for the carrier this year.
Reports state that the T-Mobile US’ LTE network has been designed to reach out to 313 million people in the U.S. by the end of 2016. The company is also working toward strengthening its low-band spectrum in order to cater to 251 million customers in the U.S.
Another noteworthy development is the participation of T-Mobile US in the 700 MHz A Block spectrum sale held at the Windy City of Chicago last May. The company had spent $430 million to purchase 12MHz of spectrum from the auction. Notably, the deal will help T-Mobile offer its "Extended Range LTE" using 700 MHz spectrum in every one of the top-ten markets in the U.S. Moreover, T-Mobile US expects to expand in Chicago with its licensed low-band spectrum by mid-2017.
Meanwhile, T-Mobile US continues to expand its retail presence in the U.S. to better leverage areas in which it has built out its network. The carrier opened almost 400 retail outlets in the U.S. last year, which covers around two-thirds of the nation.
Q4 Highlights
In the fourth quarter of 2016, T-Mobile US added 2.1 million net customers, reaching the total customer count to 71.5 million at 2016-end. This marks the fifteenth consecutive quarter of more than 1 million net customer addition.
T-Mobile also saw renewed strength in branded postpaid customers, with an addition of 1.2 million in the fourth quarter of 2016. Branded postpaid phone net customer addition totaled 933,000. This signifies the twelfth consecutive quarter of highest branded postpaid phone net customer gain by the company.
Branded prepaid net customer addition in the fourth quarter of 2016 was 541,000.
Wholesale net customer addition was 363,000 in the fourth quarter.
Branded postpaid phone churn was 1.28% in the fourth quarter of 2016, down 18 basis points (bps) year over year and 4 bps sequentially. Branded prepaid churn was 3.94% in the fourth quarter of 2016, down 26 bps year over year and up 12 bps sequentially. This marked the company’s best fourth-quarter branded prepaid and postpaid churn Performance to date.
Full-Year 2016 Highlights:
Full-year 2016 marked the third consecutive year for T-Mobile US wherein it has added more than 8 million net customers.
The company gained 4.1 million branded postpaid net customers, exceeding the revised guidance for branded postpaid net customer additions of 3.7–3.9 million provided in the third quarter of 2016 earnings. Branded postpaid phone net customer additions have been estimated at 3.3 million.
The company added 2.5 million branded prepaid net customers, primarily driven by the success of the MetroPCS brand promotional activities and continued growth in new markets. Wholesale net customer additions were 1.6 million for full-year 2016.
Winding Up
T-MobileUS’ innovative network expansion methodologies have helped drive substantial consumer growth and compete against market behemoths such as Verizon Communications Inc. (VZ - Free Report) and AT&T Inc. (T - Free Report) in the enterprise market. Meanwhile,the telecom industry circle is rife with speculations that the Trump regime may pave the way for a merger between T-Mobile US and Sprint Corp (S - Free Report) .
Also, shares of T-Mobile US have outperformed the Zacks categorized Wireless National industry’s performance on a year to date basis. The stock has rallied 43.85%, which is far better than the industry’s gain of 27.41%.
However, T-Mobile US’ low-priced promotional and advertising service plans to lure customers from competitors failed to earn revenues to reward its shareholders.
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T-Mobile US Expands in Retail, Focus on Postpaid Division
Though we are just in the first week of January, U.S. national wireless carrier T-Mobile US Inc. (TMUS - Free Report) has allowed us a sneak peek into its fourth-quarter results, prior to the scheduled release.
T-Mobile US expects to witness strong postpaid subscriber growth in the upcoming quarter in comparison to the third quarter of 2016. The company officials believe that the deployment of low-band spectrum and the ongoing buildout of its retail presence are the primary factors that will drive momentum for the carrier this year.
Reports state that the T-Mobile US’ LTE network has been designed to reach out to 313 million people in the U.S. by the end of 2016. The company is also working toward strengthening its low-band spectrum in order to cater to 251 million customers in the U.S.
Another noteworthy development is the participation of T-Mobile US in the 700 MHz A Block spectrum sale held at the Windy City of Chicago last May. The company had spent $430 million to purchase 12MHz of spectrum from the auction. Notably, the deal will help T-Mobile offer its "Extended Range LTE" using 700 MHz spectrum in every one of the top-ten markets in the U.S. Moreover, T-Mobile US expects to expand in Chicago with its licensed low-band spectrum by mid-2017.
Meanwhile, T-Mobile US continues to expand its retail presence in the U.S. to better leverage areas in which it has built out its network. The carrier opened almost 400 retail outlets in the U.S. last year, which covers around two-thirds of the nation.
Q4 Highlights
In the fourth quarter of 2016, T-Mobile US added 2.1 million net customers, reaching the total customer count to 71.5 million at 2016-end. This marks the fifteenth consecutive quarter of more than 1 million net customer addition.
T-Mobile also saw renewed strength in branded postpaid customers, with an addition of 1.2 million in the fourth quarter of 2016. Branded postpaid phone net customer addition totaled 933,000. This signifies the twelfth consecutive quarter of highest branded postpaid phone net customer gain by the company.
Branded prepaid net customer addition in the fourth quarter of 2016 was 541,000.
Wholesale net customer addition was 363,000 in the fourth quarter.
Branded postpaid phone churn was 1.28% in the fourth quarter of 2016, down 18 basis points (bps) year over year and 4 bps sequentially. Branded prepaid churn was 3.94% in the fourth quarter of 2016, down 26 bps year over year and up 12 bps sequentially. This marked the company’s best fourth-quarter branded prepaid and postpaid churn Performance to date.
Full-Year 2016 Highlights:
Full-year 2016 marked the third consecutive year for T-Mobile US wherein it has added more than 8 million net customers.
The company gained 4.1 million branded postpaid net customers, exceeding the revised guidance for branded postpaid net customer additions of 3.7–3.9 million provided in the third quarter of 2016 earnings. Branded postpaid phone net customer additions have been estimated at 3.3 million.
The company added 2.5 million branded prepaid net customers, primarily driven by the success of the MetroPCS brand promotional activities and continued growth in new markets. Wholesale net customer additions were 1.6 million for full-year 2016.
Winding Up
T-MobileUS’ innovative network expansion methodologies have helped drive substantial consumer growth and compete against market behemoths such as Verizon Communications Inc. (VZ - Free Report) and AT&T Inc. (T - Free Report) in the enterprise market. Meanwhile,the telecom industry circle is rife with speculations that the Trump regime may pave the way for a merger between T-Mobile US and Sprint Corp (S - Free Report) .
Also, shares of T-Mobile US have outperformed the Zacks categorized Wireless National industry’s performance on a year to date basis. The stock has rallied 43.85%, which is far better than the industry’s gain of 27.41%.
However, T-Mobile US’ low-priced promotional and advertising service plans to lure customers from competitors failed to earn revenues to reward its shareholders.
We believe such mixed outcomes and moves have been the reason behind T-Mobile US’ current Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>