T-Mobile US Loss Narrows On Subscriber Addition, Lower Expenses - Update

(RTTNews) - T-Mobile US Inc. (TMUS) Tuesday reported a third-quarter loss that narrowed from last year, as it added more subscribers while results for the prior year had a hefty impairment charge.

T-Mobile US is the fourth largest wireless network in the US. The company is the result of the combination of MetroPCS Communications Inc. and T-Mobile USA Inc, and is 74 percent owned by Deutsche Telekom AG (DTEGY.PK).

During the quarter, T-Mobile US added more than 1 million customers, including branded postpaid net additions of 648,000. T-Mobile US ended the quarter with more than 45 million customers.

Thats much more than AT&T which last month said it added 363 thousand wireless postpaid subscribers in its recent quarter, while Verizon added 927 thousand postpaid customers.

T-Mobile US' churn rate, or the rate at which postpaid customers exited its network during the quarter, improved to 1.7 percent from 2.3 percent in the prior year.

However, average monthly revenue per user, or ARPU, sharply fell to $52.20 from $56.59 a year ago.

The company, after disbanding service contracts and offering early phone upgrades, recently launched cheaper international call rates and service fees for tablet computers.

T-Mobile US posted a quarterly net loss of $36 million, compared with a net loss of $7.73 billion last year.

Results for the prior-year quarter included goodwill impairment charge of $8 billion.

Revenues for the quarter climbed to $6.7 billion from $4.9 billion a year ago. On average, 18 analysts polled by Thomson Reuters estimated revenues of $6.57 billion for the quarter.

The company said results were helped by the contribution of MetroPCS and higher smartphone sales.

For 2013, T-Mobile US said branded postpaid net additions for 2013 are now expected between 1.6 million to 1.8 million, up from prior guidance of 1 million to 1.2 million.

The telecom sector has been undergoing vibrant changes. In July, AT&T agreed to acquire prepaid-wireless provider Leap Wireless International Inc. (LEAP) for about $1.19 billion.

Recently, AT&T agreed to lease the rights to about 9,100 of its company-owned wireless towers as well sell about 600 towers to Crown Castle International Corp. (CCI). AT&T will receive about $4.85 billion in cash up-front proceeds for the deal.

In September, Verizon Communications agreed to buy British mobile phone company Vodafone Group Plc.'s (VOD, VOD.L) 45 percent stake in their Verizon Wireless joint venture in a $130 billion cash and stock deal.

Japanese telecom company SoftBank Corp. (SFTBF.PK, SFTBY.PK) agreed to buy a 78 percent stake in Sprint for $21.6 billion.

T-Mobile US' stock is trading at $27.88, down $0.46 or 1.62%, on a volume of 7.2 million shares on the NYSE.