‘No questions, please,’ was the implied message T-Mobile US gave Wall Street as the company released another strong quarterly report. The “un-carrier” wasn’t trying to dodge questions about its numbers, which were better than analysts had expected. But the company restricted itself to a press release and a video blog, and is widely believed to be avoiding a call with investors because it is in the midst of merger negotiations with Sprint. Sprint said this morning that it will release its earnings on Wednesday, October 25, and will also skip the traditional call with investors and analysts.
The decision to forego earnings calls, which almost always include direct questions from analysts, is a clear sign that merger talks continue, but it’s not an indication of how those talks are going. A few weeks ago, many people were predicting a merger announcement that would accompany this week’s earnings releases. At that time, the companies were said to be unable to agree on several key decision points, including the value of Sprint’s stock and the location of the merged company’s corporate headquarters.
T-Mobile’s latest report shows that it continues to be the stronger company from a financial perspective. The company reported record service revenue of $7.6 billion and total revenue of $10 billion for the third quarter. Net income was $550 million, or 63 cents per share, well above consensus forecasts.
T-Mobile added 1.3 million net customers, of which 595,000 were branded postpaid phone customers. Another 222,000 net additions were tablets or other connected devices, bringing T-Mobile’s total branded postpaid net additions to 817,000 for the quarter. That number includes 83,000 net additions for T-Mobile’s DIGITS offering, which lets customers use one number across multiple devices.
T-Mobile noted that it has consistently added more than a million customers per quarter for the past four and a half years. The rate of growth is slowing somewhat, however. At the end of Q3 in 2016, the company had added more than 6 million new customers year to date. This year, it has added 3.8 million so far.
The company credited its partnership with Netflix for bringing more new customers on board during the third quarter. T-Mobile offers a free Netflix subscription to subscribers who sign up for certain T-Mobile ONE voice plans.
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