T-Mobile US Inc (NASDAQ: TMUS) has posted better than expected results in the second quarter of FY 17, which is the No. 3 U.S. wireless carrier gained more phone subscribers who pay a monthly bill, the industry’s most valuable customers. Overall, TMUS net income grew to $581 million, for the second quarter ended June 30th from $225 million, a year earlier. As a result, the stock rallied over 3.3% in the pre-market session on July 20th, 2017 (As of 4:31AM EDT; Source: Google finance). T-Mobile stock has risen 39.54% in a year (source: Google Finance).
TMUS in the second quarter has reported that its total net customer additions were 1.3 million, bringing the total customer count to 69.6 million. The branded postpaid net customer additions were 817,000. The branded postpaid phone net customer additions were 786,000 during the second quarter, up from 646,000 in the year-earlier period. The analysts on average had expected net additions of 607,000, according to research firm FactSet. Further, the branded postpaid phone churn was a record low of 1.10%, down 17 basis points from prior year.
However, even with the higher forecast, T-Mobile is unlikely to match its 4.1 million subscriber additions from 2016. Sprint Corp., which trails T-Mobile in wireless customers, has introduced more aggressive promotions, including a full year of free, unlimited data. The bigger rivals AT&T Inc. and Verizon Communications Inc. have followed TMUS in offering unlimited data plans
T-Mobile in the second quarter of FY 17 has reported the adjusted earnings per share of 67 cents, beating the analysts’ estimates for the adjusted earnings per share of 38 cents. The company had reported the adjusted revenue of $10.21 billion in the second quarter of FY 17, beating the analysts’ estimates for revenue of $9.81 billion.
For full-year 2017, T-Mobile has stated that its branded postpaid net customer additions guidance is increased to 3.0 – 3.6 million from 2.8 – 3.5 million. The company has increased adjusted EBITDA forecast to be between $10.5 – $10.9 billion, up from the prior guidance range of $10.4 – $10.8 billion. The adjusted EBITDA target includes expected leasing revenues of $0.85 – $0.95 billion, increased from the prior guidance range of $0.8 – $0.9 billion. The company has raised its profit outlook for 2017, suggesting that promotions, price cuts and giveaways needed to attract new customers are not hurting the bottom line.