(Reuters) – T-Mobile US Inc on Thursday reported quarterly revenue and profit that beat Wall Street estimates, as the wireless carrier added more than expected phone subscribers who pay a monthly bill.
FILE PHOTO – A sign for a T-Mobile store is seen in Manhattan, New York, U.S., April 30, 2018. REUTERS/Shannon Stapleton/File Photo
Shares of the company rose nearly 2 percent to $68.01 in trading before the bell.
The company, the third-largest U.S. wireless carrier by subscriber count, is awaiting approval of its deal to buy smaller rival Sprint Corp as it strives for more scale to compete with bigger rivals Verizon Communications Inc and AT&T Inc.
T-Mobile said it added a net of about 1 million so-called postpaid phone subscribers in the fourth quarter compared with 891,000 additions a year earlier. Analysts were expecting 912,000 new subscribers, according to research firm FactSet.
Analysts watch the postpaid figure, because those customers pay a recurring monthly bill and are more valuable to carriers that prepaid users.
The wireless carrier said it expects to add, without Sprint, 2.6 million to 3.6 million net new postpaid customers in 2019.
T-Mobile added network capacity in rural areas of the United States, which allowed it to build more retail stores in those areas and expand the carrier’s geographical footprint, said Jonathan Chaplin, an analyst with New Street Research.
The company’s net income fell to $640 million, or 75 cents a share, in the fourth quarter, from $2.71 billion, or $3.11 a share, a year earlier, when it recorded a big one-time tax related gain.
Revenue rose to $11.45 billion from $10.76 billion.
Analysts were expecting revenue of $11.39 billion and profit of 69 cents per share, according to IBES data from Refinitiv.
T-Mobile, as well as the country’s other major carriers, are racing to build the next generation wireless network, or 5G, expected to bring faster data speeds.
T-Mobile told the U.S. Federal Communications Commission on Monday it would not increase prices for three years, with few exceptions, if it gets approval to buy Sprint for $26 billion.
Reporting by Akanksha Rana in Bengaluru and Sheila Dang in New York; Editing by Arun Koyyur