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Despite huge subscriber gains, the ‘Un-carrier’ is once again unprofitable

Published Oct 28th, 2014 8:10AM EDT
T-Mobile Q3 2014 Earnings

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As we’ve said before, more intense competition in the wireless world is great for consumers but not-so-great for carriers’ bottom lines. T-Mobile, which has been at the forefront of America’s newly competitive wireless market, reported adding 1.38 million postpaid subscribers and 410,000 prepaid subscribers, which easily topped the 785,000 postpaid subscribers that AT&T added over the same quarter but was slightly behind the 1.5 million postpaid subscribers that Verizon added. The company also raised its projected for total postpaid subscribers added this year from 4.3 million to 4.7 million.

RELATED: The mobile price wars may finally be starting to sting AT&T

That said, these subscriber gains have come at a cost: T-Mobile reported a net loss of $0.12 per share even though the consensus estimate was that the company would post a net profit of $0.03 per share. The carrier also whiffed on revenues, as it reported $7.35 billion on the quarter versus the consensus estimate of $7.45 billion. T-Mobile’s churn was also at 1.6%, which is lower than in previous quarters but still a long way from AT&T and Verizon’s churn rates that were both right around 1% last quarter.

Taking a broader view of things, it’s interesting to note that all three mobile carriers who have reported earnings for the past quarter have continued to add postpaid subscribers at a healthy clip. This suggests that Sprint, which has long been the “sick man of wireless,” could be in for some pain when it reports its own earnings next week.

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.