TracFone Lost 58K Subscribers Last Quarter - Twice

TracFone Lost 58K Subscribers Last Quarter

Voice-only brands Net10, TracFone blamed for Q4 drop
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TracFone Wireless, the largest MVNO in the U.S., lost 58,000 net subscribers in the fourth quarter and 338,000 for the year, parent America Movil reported.

The prepaid no-contract company ended the year with 25.7 million subscribers, down 1.3 percent from the year ago.

The quarter’s losses came in the company’s Net10 and TracFone voice-only brands, while the StraightTalk, SafeLink, and Total Wireless brands “continued to show solid growth,” parent America Movil said. Those brands offer data service as well as voice.

Monthly average minutes of use per subscriber dropped 6.6 percent in the quarter to 496 minutes.

The quarter’s earnings before interest, taxes depreciation and amortization (EBITDA) rose 7.5 percent year over year to $77 million, “reflecting our efforts to reduce costs in what continues to be a very competitive environment,” America Movil said. Full-year EBITDA fell 9.4 percent to $593 million.

Fourth-quarter revenues were flat at $1.76 billion but up 1.9 percent for the year to $7 billion. In breaking out its revenue streams, TracFone said the quarter’s service revenues were up 1 percent to $1.56 billion, but equipment revenues, including handsets, fell 7.1 percent to $196 million because of lower handset pricing. For the year, service revenues were up 2.1 percent to $6.3 billion, with handset revenues up 0.8 percent to $703 million.

TracFone is a subsidiary of Mexico-based America Movil, which operates landline and wireless networks throughout Latin America and in Europe. TracFone sells prepaid service under the TracFone, Net 10, StraightTalk, SafeLink brands, Simple Mobile, Telcel America and Page Plus brands. StraightTalk is available exclusively through Walmart. 

TracFone handsets and airtime cards are sold in more than 90,000 retail locations across the U.S. The company resells airtime from the Verizon,AT&T, T-Mobile,Sprint and U.S. Cellular networks.

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