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T-Mobile Q3 Subscribers Up 1 Million, Net Loss Shrinks

11/05/2013 04:11:00 AM Eastern

Bellevue, Wash. — T-Mobile’s uncarrier strategy appears to be working.

For the second consecutive quarter, the carrier posted a net new subscriber gain of more than 1 million, and the company shrank its net loss on a sequential and year-ago basis.

Separately, the carrier said it would expand its MetroPCS brand on Nov. 21 to 15 more markets following the third-quarter addition of 15 new markets with more than 1,300 distribution points.

The company attributed the subscriber gains and a lower churn rate to its network modernization program, which brought 4G LTE 4G to 254 metro areas, and to its uncarrier strategy.

Third-quarter net subscriber additions hit 1.023 million compared with the second quarter’s gain of 1.05 million. In the first quarter before the full effects of the uncarrier strategy could be felt, the carrier gained 579,000 subscribers. In all of 2012, the carrier gained only 203,000 net new subscribers.

T-Mobile’s subscriber base stood at 45 million at the end of the third quarter.

The company’s net loss shrank to $36 million compared with the year-ago loss of $7.73 billion, which included an $8.13 billion write-down. Sequentially, the loss was down from the second quarter’s $16 million loss. The company had posted a first-quarter net income of $107 million but slid into the red in the second quarter because of expenses related to launching its uncarrier strategy and its network improvements.

Third-quarter revenue climbed 8.7 percent to $6.69 billion compared with the year-ago quarter, including year-ago MetroPCS revenues.

Sequentially, combined MetroPCS/T-Mobile revenues grew only 0.6 percent.

The company's churn rate improved to 1.7 percent from the year-ago 2.3 percent.

Among the net new subscribers, 672,000 were branded subscribers following the addition of 601,000 branded subscribers in the second quarter. The company lost 439,000 subscribers in last year’s third quarter. The postpaid number excludes about 5,000 mobile-device net adds such as tablets and USB modems.

Of the branded net adds, the vast majority — 643,000 — were branded postpaid net adds, beating all rivals for the second consecutive quarter, the company said. The number of prepaid net adds hit 24,000 following a second-quarter loss of 87,000. The year-ago gain was 53,000.

The number of subscribers gained through MVNOs hit 351,000, up from the year-ago 287,000 but down from the second quarter’s 452,000.

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