T-Mobile Q4 2013 earnings – 1.6 million net additions, low churn and expanding LTE

T-Mobile-HQ-645x483

As we were already aware – after John Legere’s press conference at CES – last quarter was incredible for T-Mobile. More than 1.6 million customers joined Magenta’s ranks. 981k of those were branded customer additions, with 869k of those being postpaid. If you’ve been following Tmo’s earnings and reports for a while, you’ll know that those figures alone represent the best quarter T-Mobile’s had for a very long time. In fact, it’s Tmo’s best quarter since the end of 2005.

Another encouraging note, often not given enough mention, is the low churn rate of just 1.7%. That means very few customers are leaving for other companies. It’s also the third quarter in a row that Tmo’s revenue has grown. All in all, it’s a great end to a year that’s seen T-Mobile transform from being a no-hope carrier almost bought by AT&T to one that everyone is talking about.

Full Year 2013 Highlights:

  • Total net customer additions of more than 4.4 million on a pro forma combined basis
  • 2.4 million total branded net customer additions including 2 million branded postpaid and 359,000 branded prepaid customers on a pro forma combined basis
  • Branded postpaid churn of 1.7%, down 70 basis points year-over-year
  • Adjusted EBITDA of $5.317 billion and Adjusted EBITDA margin of 26% on a pro forma combined basis
  • Successful introduction and execution of major Un-carrier initiatives
  • Rapid progress with the integration of MetroPCS by expanding the brand into 30 additional markets
    • Currently 3.5 million MetroPCS customers on the T-Mobile network
  • Met or exceeded all company guidance targets for 2013

“Our performance in the fourth quarter and the full year is clearly proving that we have our strategy right and that we are executing it well,” said John Legere in his official statement. “Customers are fed up with the old ways and are voting in favor of choice, innovation and doing business with a company that cares about them and is willing to earn their business. For shareholders, we transformed the Company into a fierce, growing competitor that is changing the wireless industry and creating significant value.”

Also mentioned in the report was the continued expansion of LTE across the country. With more than 209 million people covered in 273 markets, the advanced network rollout has been incredibly fast. And isn’t slowing down. Over the next 12 months we’ll see a few more locations light up, as well as the “Wideband LTE” or 20+20 network go live in a handful of major cities. To top it off, the 700MHz spectrum should be put to use by the time 2014 comes to a close. 158 million people will benefit from the A-block airwaves, once the deal with Verizon is finalized around the middle of this year.

For full details on all the ins and outs of the announcement, head on over to T-Mobile’s official press release. 

 

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  • Scarfacemario

    Better late than never right Cam? Man screw this ya need to hire someone to help you I miss David I used to check Tmonews every 3 hours, every day sadly I can’t say that anymore this site has gone downhill :’(

    • Willie D

      There is a major time difference between UK where Cam is located and here in the US where we and TMobile is located. I’d figure with that, combined with the fact Cam is not a TMobile USA customer, he has less incentive to report sooner and be excited.

      • Cam Bunton

        Nope. This time out, I literally could not get to it sooner. I was traveling home from MWC in Barcelona. You have no idea how much rushing, and paying taxis, I had to do just to get it up as soon as I did.

        Yes, it’s later than I’d have liked, but it’s here, and it’s the best I could do this time.

        • besweeet

          Sounds like PhoneDog needs to bring in a second person to handle things during situations like that. I’m sure there are a lot of people who wouldn’t mind helping, even if not compensated.

        • Cam Bunton

          In all honesty, I should have asked someone to help out on this.

        • philyew

          Ironically, it was Cam who carried some of the load last year for David. The Galaxy S4 launch was one example, I think.

        • D Nice

          Forget them Cam. I appreciate your efforts they tripping as if this is a paid service or something. Late or not I enjoy reading here.

        • Mark

          Barcelona… where the dogs have no noses?

          I miss when PhoneDog gave away hardware, that’s what I miss.

    • EWTHOM

      Unfortunately, I agree. David would dig up nuggets of T-Mobile related news far more frequently. I also do not understand the logic of a U.K. based blogger covering a U.S. mobile carrier.

    • xmiro

      He’s in the UK which is 5 hours ahead of the east coast

    • AM Gone

      Could not agree more. Really miss the TMO news that David brought almost daily.

    • bisayan

      I disagree with you! Although I like David as well..I’m still very happy that they kept tmonews to give us insight on what tmobile have plans for us..On the other hand, Cam has been doing a fantastic job! Just fyi Cam is not only working for tmonews but also for phonedog as well, Just be patient everybody that is all :))

      • Stone Cold

        All these sites belong to Phonedog.

    • Paul

      You could go start your own blog to cover T-Mobile.

    • Stone Cold

      But Cam is doing the best he can with what he has.

    • Cam Bunton

      Like I mentioned when I published the reminder this morning. I was traveling back from Barcelona where I covered MWC for Phonedog at the weekend. I dealt with the crappy Airport wireless to get that reminder up. Incidentally, also dealt with the even worse wireless on my train from airport-home to get the Lumia update post up. And also – although I’d not seen my family for 4 days – I rushed up to my office to get the earnings results up for you.

      You’re welcome.

  • S. Ali

    “Cash capital expenditures are expected to be in the range of $4.3 to $4.6 billion.”

    I wonder what they are planning. New spectrum, expanded coverage, or paying off more ETFs?

    • victorchavez

      spectrum auction next summer =P one would hope

    • Chardog

      Deploying the spectrum just bought from Verizon…Infill for suburban areas- 700 mhz

    • randian

      Paying off ETFs wouldn’t be classified as capital expenditures.

    • xmiro

      CAPEX is only for fixed assets, if I’m not mistaken, so it goes toward things like the network or spectrum.

      There will be a 25x25Mhz AWS-3 spectrum auction mid-year probably that T-Mobile has been pushing for and 15x15Mhz PCS

      • besweeet

        How many markets will that auction (and the one in 2015) cover? Hopefully they add some native coverage to some currently roaming (or no service) areas, as well as adding at least 3G to all of the 2G/GPRS areas.

        • xmiro

          no idea, i would imagine the FCC is going to chop up the spectrum into nationwide and highly localized licenses to give smaller carriers an opportunity to buy in.

          I would predict that we can expect T-mobile to play aggressively into this so they can have 20×20 Mhz LTE just about

          T-mobile’s got nationwide AWS licenses, and i think PCS too, it’s just that they are not willing to spend the money to put 3G or 4G covering rural areas. The T-Mobile 2G network covers quite a bit actually.

          The 2015 auction is not a done deal at all. I wish people would talk about it as a possibility rather than a fact. I talk to broadcast engineers and many stations are very sour on the whole auction because they think the wireless carriers are trying to stick them with the bill for the upgrades which in many instances will be very expensive

          Low band spectrum is great, but it’s not what going to help with coverage unless the carriers invest in deployments. I have family that live on not too rural farm and even Verizon and AT&T low-band coverage is terrible because the towers are so sparsely populated. If you look at the AT&T coverage map all the light orange areas represent the weakest part of the signal

        • besweeet

          Gah… That’s a little depressing. The 2G needs to go (well, not disappear, but just be overlaid by 3G).

  • Scarfacemario

    Ohh and Wooooo 250 Million!!! Covered with LTE by the end of 2014!!!! Awesome!!!!!!!! Great to see their expanding LTE/4G coverage finally :)

  • PiCASSiMO

    I may end up being part of the 1Q2014 churn rate if T-Mobile doesn’t get their sh*t together and start patching up suburban Chicago’s 3G and EDGE areas with true HSPA or even LTE service. Unacceptable to sit and wait for 2-3 minutes as my Spotify song buffers, listen, and then repeat the wait.

    • Willie D

      Try a better music streaming service then. Pandora, Google All Access, Slacker..

      • PiCASSiMO

        Pandora/Slacker, can’t create independent playlist.
        Tried Google All Access for a month, they don’t have the same stand-alone (non-web) application to sort through my music/playlists.

        Neither of the above fix the dead-spots with 3G or EDGE service. Being patient while I want on Google Maps to locate an address is anything but thrilling.

        • GuyBorg

          Are you using the N4 or the N5? I travel throughout chicagoland and suburbs on a weekly basis and have pretty solid LTE on T-Mobile everywhere I go. If you are using the N4, its not going to be as good of an experience since it does not have LTE. Even rooted the N4 still has issues with LTE.

        • PiCASSiMO

          You might be driving on the major highways where coverage is ample. Any carrier would want to represent their company when travelling to through a major city with coverage off the highway.

          But regarding the phones, N5 is mine where I’ve experienced EDGE and 3G service in Glenview/Northbrook, IL. Off Willow Road, between I294 and I94 highways. My wife’s N4 has experienced NO SERVICE on her phone where I got EDGE service. Sadly, the signal shouldn’t be this week.

          I remember in my old commute, just north of O’Hare airport in Des Plaines, there was a pocket of NO SERVICE and EDGE that I’ve been getting for YEARS. No matter how many times I’ve called T-Mobile, nothing was done.

          Sadly for T-Mobile, the more times we see EDGE or NO SERVICE, we’ll pay the extra $30 and get AT&T family plan for $130 and be done with it.

        • besweeet

          Looked that area up on T-Mobile’s map, RootMetrics and Sensorly. Seems like a struggle zone for all 4 of the big players. Kind of surprising to have EDGE or no service. And that’s when outdoors as well?

        • PiCASSiMO

          Excellent maps from Sensorly. Validates the issues I’m having with T-Mobile, and it does highlight that AT&T has also similar gaps with EDGE service. Verizon, is king, with almost 4G LTE penetration to T-Mobile’s 2G in the areas beyond suburban areas and on the highways.

          RootMetrics is the similar, and wished they had dates supporting their readings (if they were taken yesterday or 2-years ago) to validate their claims.

        • xmiro

          on verizon, look at their map online and make sure you’re not in an LTE Extended Coverage area, from personal experience unless outside I’ve been unable to connect to LTE

        • GuyBorg

          I live in the Crystal lake area far west, but often am all over chicagoland(off the highway). I rarely experience the same as you on my HTC handsets. Maybe T-Mobile just isn’t for you.

        • Steve

          Yeah if you aren’t using jump and your service sucks then 30 bucks is worth switching. Just make sure that the other ones get service in that area- I noitced some areas just outside lte that are dead on att and verizon as well.

        • eanfoso

          You dear sir need a Lumia phone, offline maps and offline playlist from Nokia mix radio

        • PiCASSiMO

          I have one… Lumia 520. It’s sitting idling and waiting for a road trip to be used a offline GPS device.

          Offline music can be done with Spotify. I can do all my 64 different playlists and suck up more than 16GB of space I have available on the Nexus 4 or 32GB on the Nexus 5. When I’m travelling to rural areas, I do that for a few playlists.

          But for day to day, I don’t want to cram my phone with offline maps and or music when I’m in suburban metropolitan area they call Chicago.

          T-Mobile needs to fix those EDGE and NO SERVICE pockets here in Chicago.

        • eanfoso

          You’re not cramming it, not if it only takes 250mb of space, the lumia 520 has 8 gb of storage, why not go for the bigger brother lumia 1520? 16 gb of storage and sd card slot, problem solved, plus because it’s a windows phone it won’t slow, unlike lagdroid that slows after a couple of months of use

        • PiCASSiMO

          The 520 cost me some $35…dont think you can get the same deal for 1520.

    • Kravn

      Hold out, buddy…Chicago is covered by the 700mHz spectrum we expect begin deploying soon. You can expect better building penetration and suburban/rural reception!

      • PiCASSiMO

        But do I not need to replace our Nexus 4 and Nexus 5 phones to be able to use the 700Mhz band?

        • UMA_Fan

          No phone works off 700mhz a block yet. They should come out towards the end of the year

        • PiCASSiMO

          That’s what I thought. Which means a two fold investment: A) Waiting till 700Mhz band is kicked-off with T-Mobile and then B) investing in new phones that can take advantage of the 700Mhz band.

        • randian

          If there are any such phones at T-Mobile’s launch. The Samsung S5 obviously isn’t one, the Moto X replacement is up in the air, and it’s unknown outside of Apple when the iPhone 6′s radio design will be finalized, if it hasn’t been already.

        • UMA_Fan

          Apple supports more LTE bands than any other singular device out there currently. I can’t imagine they won’t have enough time to throw 700 a block in there. I bet they will re launch the S5 with 700mhz a later in the year just like they relaunched the S3 with LTE. Considering how much the galaxy series sells it would be worth tmobiles time to get Samsung to do this.

        • TheVorlon

          The iPhone already supports 700b and 700c on the 5c and 5s.

          Might only need a software update when the time comes.

          https://www.apple.com/iphone/LTE/

        • superg05

          700 Mhz a block need new hardware unless it’s Nvidia’s software defined modem

        • Andrew Pearson

          More bands than the nexus 5?

        • UMA_Fan

          Sounds like that’s what jump is for

        • PiCASSiMO

          Not when I’m procuring my phones outside of T-Mobile.

        • Jonathan

          You would also have to make the same investment if you switch carriers.

        • PiCASSiMO

          Not when I’ve got a pair of Nexus (4 and 5) phones. Wouldn’t need to on AT&T’s network.

        • eanfoso

          Check the bands of the xperia z1s, it has the 700mhz band added to it

        • TMOguy

          It does not have 700mhz block A (Band 12), sorry.

        • eanfoso

          It’s actually band 17 lol, got email so I can send you a picture of the box so you can see it for yourself?

        • lynyrd65

          US Cellular phones do

      • boehmer365247

        No it’s not. Leap owns the A-block spectrum in Chicago.

      • Windy City 60639

        Sorry it won’t b cover by the 700mhz buyout from verizon spectrum check map Chicago is not in it. Sorry.

  • MeekMillsBarber

    T-mobile service really poopi ?

  • Jay Holm

    I will be interested to see what Tmo’s Q1 results will be, first full qtr of doing the etf buyouts, that should be interesting!

    • Cam Bunton

      Yeah. Same here. Should be very interesting indeed.

  • vlcmfreak7

    I read somewhere else that it cost T-mobile 20 million from the incentives to get people to switch. At&t also rolls out unlimited international messaging for text, pictures and videos and reduced international calling rates that include 1c per minute to over 35 countries. I’d be nice to see a comparison between t-mobile and at&t with all these new changes.

    • xmiro

      it costs T-mobile and the other carriers around $350 to add a new account/customer, T-Mobile is simply shifting that cost by paying the ETF (and letting the press advertise it for free) instead of buying heaps of advertising, which they’re still doing.

      They are not losing money on the services like the international roaming, they’re just taking a reduced profit

    • bkin94

      It is true that they lost 20mil. This was a combination of cost to acquire customers going up a bit (etfs) and the average amount customers are paying going down (value plans/simple choice). Tmo executives responded saying that the costs are necessary for growth and that the money will be made back in the long term because of the low churn rate and decreased cost of serving current customers

      • Dakota

        Guess that should be in the story above.. Thats part of the news of the quarterly EARNINGS report

      • rene

        how about the chunk of millions to Verizon for the 700 a block of spectrum, that doesn’t count

  • sushimane

    Good Job Tmobile!!!! keep it up

  • fentonr

    I believe you have a typo Cam, you say with over 869k of those being prepaid. I think you mean postpaid.

    • Cam Bunton

      Thanks for spotting. Changed it.

  • Cam Bunton

    Hey Guys, Just writing you guys a sincere, short note to apologize for being so late on this. I was traveling home from Barcelona where I’ve been covering MWC. It was really inconvenient that I was boarding my wi-fi-less plane at the time the press release went out, and still traveling when the conference call was live. It’s why I posted the reminder early this morning, so you’d not thought I’d forgotten. I got home, back in to the land of usable internet around 6:30pm GMT/1:30pm Eastern.

    In hindsight, I know I should have organized better and roped someone in to cover it and help me out. I tend to always go with the “do it all myself” route, and in this instance, that didn’t serve you guys well at all. And serving you should be my first and utmost priority.

    Again, sincere apologies.

    • Jose Hernandez

      It’s all good Cam.

    • bkin94

      thanks for all you do! this site is great!

    • Deadeye37

      You’re doing a good job! The fact that you apologized and explained what happened shows that you really are trying your best here. Thank you!

    • Dakota

      WYou nderstand but hope now that this type of thing has happened before, you will plan accordingly to have a backup in the future. It doesnt do the blog much good if theres major Tmobile news on every other site except this one. I’m also curious why the Wall Street headline of a $20 million loss isn’t in your story. Maybe you don’t think it’s important but if so, mention it and explain why it’s not a major concern and what Tmobile management had to say about it. Tmobile is a publicly traded company. Their profits and losses are as important as the customer acquisitions, churn rates, LTE etc. It affects shareholders, whether there’s incentive for someone to But them or for them to sell

  • Nearmsp

    So why did Tmobile stock crash almost 6% today?

    • bkin94

      Most of the press today was about the large amount of money TMO lost. you should get a pretty good idea of what i mean by searching for “tmobile earnings” news. Also, wall street is just crazy and sets unrealistic expectations for pretty much everyone (just look at Apple’s stock on the days they announce earnings that break every record imaginable)

    • Dakota

      The article above neglected the headline of a $20 million loss

  • $15454173

    Your good bro. Glad you got to Barcelona and give us the news.

  • Dakota

    It’s a financial announcement and no mention of the $20 million loss, which was the headline in every other news story. Maybe since he now works for Tmobile, David is back. Kind of a spin if you don’t include all the major bullet points, especially for a publicly traded company. The story needs to include are the costs T-Mobile is incurring to get new customers going to pay off in the long run since they are signing people. Profit and financial position and strategy matters too

    • vrm

      who do you work for ? I mean, clearly you do not have a real job but who are you shilling for ?

    • bkin94

      the strange thing is that i did not see or hear the stat that all the press seems to be talking about in the earnings call. I may have missed something, but i did not hear any of the execs mention the 20 million number. I wouldn’t want Cam to mention that number as fact if it was not given as a part of the earnings call. I assume since you are so adamant about this, you must know where the number came from. care to point me to the slide number or time-stamp where the all-important stat came from?

  • TylerCameron

    T-Mobile’s 3G network covers no more than 230 million people. And they’re saying that the LTE network is gonna cover 250 million people by the end of 2014. So they’re actually going to actively upgrade 2G areas to 3G/HSPA/LTE?.. o_o

    • bucdenny

      Good luck with getting back haul to those 2G sites. They will need to burn billions more to get it done. Ain’t going to happen with no cash fusion. It is exactly what Sprint is going through, upgraded hardware at most sites, fiber back haul not delivered on schedule to turn up 4G.