T-Mobile maintained its momentum in the third quarter by adding another 2.3 million total customers partly due to a record 1.4 million branded postpaid net adds. In all, the carrier says it’s added 10 million total customers over the last six quarters.
The subscriber rush has caused T-Mobile to raise its forecast for full-year branded postpaid net customer additions to somewhere between 4.3 million and 4.7 million, up from prior guidance of 3 million to 3.5 million.
Branded prepaid net adds shot up more than four times quarter-over-quarter to 411,000, but T-Mobile paid elsewhere for its prepaid ambitions.
Total revenues for the quarter rose 9.9 percent annually to $7.35 billion but analysts were hoping to see it reach $7.47 billion.
T-Mobile this quarter absorbed some of the cost related to shutting down the MetroPCS’ CDMA network. T-Mobile acquired MetroPCS last year. Of the $250 million to $300 million in CDMA shutdown costs T-Mobile anticipates for 2014, $97 million showed up on the third-quarter balance sheet.
But T-Mobile is making progress with the MetroPCS transition. The carrier says that now 78 percent of MetroPCS customers have migrated to the T-Mobile network and that 63 percent of MetroPCS’s spectrum has been refarmed for use in T-Mobile’s LTE network.
During Tuesday’s earnings call, CMO Mike Sievert addressed revenue growth by saying that all T-Mobile’s Un-carrier moves have been “incredibly disciplined” and focused on profit growth. He said it’s very different from what T-Mobile has seen from Sprint, which has deployed a “scorched earth” pricing structure under new CEO Marcelo Claure.
That LTE network is ahead of schedule. T-Mobile says it’s already reached its year-end coverage goal of 250 million people and is now aiming to cover 300 million people by the end of 2015. CapEx rose to $1.1 billion during the quarter as T-Mobile is beginning LTE deployments on its 700 MHz and 1900 MHz spectrum, as well as continuing its ongoing AWS deployment.
CTO Neville Ray said the focus for refarming PCS right now is outside the carrier’s urban core where AWS deployments are being used for LTE speed and capacity. In those “Wideband LTE” metro markets, Ray said data usage has increased but assured that it’s part of T-Mobile’s plan and that the capacity issues have been minimal. He said customers are using between 2GB and 3GB and that T-Mobile anticipates that number to go up in its “Wideband” markets.
As for the 700 MHz LTE deployment, Ray said T-Mobile expects all its LTE handsets next year will support that spectrum.
T-Mobile stock is up nearly three percent in early trading Tuesday.