Photo: Mike Mozart / CC BY 2.0 (cropped)
T-Mobile’s third-quarter profit rose 27% to $3.5 billion as the wireless carrier added postpaid accounts and collected more service revenue per account.
The company reported service revenue of $19.4 billion, up 6% from a year earlier, in results released Wednesday. Postpaid service revenue increased 9% to $16.3 billion.
Postpaid average revenue per account, or ARPA, rose 4% to $155.73. That is an account-level measure, not an individual customer’s bill or a uniform price increase across its plans.
Accounts grow to 35 million
T-Mobile added 274,000 postpaid accounts on a net basis during the quarter, bringing its total to 35 million, up 3% from a year earlier. These are account additions, not a count of new phone customers. Postpaid account churn was 1.09%.
Diluted earnings increased 34% to $3.22 a share. Core adjusted EBITDA, the company’s measure of adjusted earnings before interest, taxes, depreciation and amortization less lease revenue, rose 11% to $9.6 billion.
Cash flow measures diverge
Cash from operating activities fell 2% to $7.3 billion, while adjusted free cash flow increased 5% to $5.1 billion. Cash purchases of property and equipment, including capitalized interest, declined 14% to $2.3 billion.
The company returned $3.5 billion to shareholders in the quarter through $2.4 billion of share repurchases and $1.1 billion in cash dividends.
Profitability outlook narrows at a higher midpoint
T-Mobile now expects full-year core adjusted EBITDA of $37.35 billion to $37.45 billion, compared with its previous range of $37.1 billion to $37.5 billion. The narrower range has a higher midpoint.
It expects adjusted free cash flow of $18.7 billion to $18.8 billion, including net payments for UScellular merger-related costs, compared with its previous forecast of $18.4 billion to $18.8 billion.
Full-year postpaid net account additions are expected to be about 1 million, the midpoint of the company’s earlier range of 950,000 to 1.05 million.
JBizNews Desk | Bellevue, Washington
© JBizNews.com. All rights reserved. Unauthorized reproduction or redistribution is strictly prohibited.
