U.S. Cellular posted a net income of $4.9 million for its first quarter of 2013, down a considerable 97 percent from the $62.5 million it posted in the same quarter last year. Similarly, diluted EPS for the quarter sank to $0.06, down from the $0.73 EPS it posted in the first quarter of 2012.
Revenue for the carrier remained mostly flat at $996 million, just down from $1 billion annually. But that number should see a bump in the next quarter when U.S. Cellular said it expects a previously announced spectrum sale to Sprint to close. The FCC has approved the deal in which Sprint will pay $480 million to U.S. Cellular for its Chicago, St. Louis, central Illinois markets and three other divestiture markets.
“We continued to expand our 4G LTE network and encourage customers to migrate, which has helped us further increase smartphone penetration and shift more customers to 4G LTE,” said CEO Mary Dillon.
Smartphone penetration did rise to 43.5 percent and along with it, average revenue per user continued to go up, to $54.85 from $54 annually.
U.S. Cellular also added a net 23,000 prepaid customers, which it attributed to a distribution deal with Walmart. But its postpaid numbers were not as rosy, losing a net 74,000 postpaid customers during the quarter, continuing the trend of bleeding postpaid subs set by the previous four quarters.
On this quarter’s numbers, U.S. Cellular reduced its annual consolidated revenue estimates to $3.62 billion to $3.74 billion, down from $3.77 billion to $3.89 billion.
U.S. Cellular and its parent company, Telephone and Data Systems, has its earnings call scheduled for 10:30 a.m. ET today. U.S. Cellular’s stock is down more than two percent as of 8:48 a.m. CT