T-Mobile US continued to attract consumers, reporting that during the fourth quarter of last year it added more than 1.6 million net new connections to its network. The growth pushed T-Mobile US’ customer base to nearly 46.7 million total connections, inching closer to No. 3 rival Sprint.
T-Mobile US’ latest growth was a substantial turnaround from the 32,000 customers it lost during the fourth quarter of 2012 as well as over-powering the approximately one million net additions posted during the third quarter of last year. T-Mobile US’ Q4 growth included 869,000 branded postpaid net additions, with traditional phones accounting for 800,000 net adds and other devices making up the remainder.
Branded prepaid net additions totaled 112,000 connections during the quarter, boosted by T-Mobile US’ expansion of the MetroPCS brand. The carrier noted that it managed sequential growth in its branded prepaid business despite losing approximately 120,000 prepaid customers to its branded postpaid service.
Wholesale growth made up the remaining net customer additions for the quarter, with T-Mobile US reporting 172,000 net additions through its machine-to-machine business and 492,000 net additions from its mobile virtual network operator channels.
T-Mobile US managed to improve net additions despite mixed customer churn results. Branded postpaid churn dropped from 2.5% to 1.7% year-over-year, though remaining stable sequentially. Branded prepaid churn actually inched up slightly year-over-year from 4.9% to 5.1% and sequentially from 5% during the third quarter.
T-Mobile US’ fourth quarter results were the third strong posting in a row for the carrier, which has become a customer magnet since implementing its “un-carrier” strategy in early 2013. The carrier has managed to add more than 4.4 million net connections during the year, or growing its customer base by more than 10%.
However, despite the strong numbers, T-Mobile US’ stock (TMUS) was trading down slightly Thursday. There seemed to be concern from some that its recently announced plan to pay up to $650 per line for customers that switch multi-line accounts from its rivals could impact short-term operating costs. Analysts seemed less concerned about the financial impact, noting that the per-line outlay is likely to be well below the $650 maximum due to the handsets being traded in as well as stating T-Mobile US is likely to gain a good percentage of that outlay back by re-selling those devices to third parties.
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