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T-Mobile Misses Earnings Estimates Widely

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T-Mobile released the results from its third fiscal quarter before opening bell this morning, posting  earnings of 15 cents per share on $7.8 billion in revenue, a 7% year over year increase. Analysts had wanted to see earnings of 30 cents per share on $8.29 billion in revenue.

T-Mobile the fastest growing mobile carrier

The mobile carrier added 2.3 million subscribers during the quarter, marking the 10th in a row in which it added more than 1 million subscribers. Of those adds, 1.1 million were branded postpaid net adds. T-Mobile added 843,000 branded postpaid phones and 595,000 branded prepaid subscribers.

T-Mobile’s service revenues increased 11% to $6.3 billion, while its adjusted EBITDA climbed 42% to $1.9 billion. The adjusted EBITDA margin rose more than 600 basis points to 30%. Net income was $138 million, compared to last year’s net loss of $94 million.

The mobile carrier’s branded postpaid phone average revenue per user remained stable at $47.99 as rising attach rates offset its focus on family plans and promotions. T-Mobile sold or leased 8.9 million devices during the third quarter, of which 8.1 million were smartphones. Branded postpaid churn fell 18 basis points to 1.46%.

T-Mobile raises customer guidance

Management also increased its outlook for branded postpaid net adds for the third time this year, bringing it to a range of 3.8 million to 4.2 million. They maintained their previously provided adjusted EBITDA target of $6.8 billion to $7.2 billion.

The mobile carrier said it continues to grow its 4G LTE network, which now covers more than 300 million Americans, meeting that goal months ahead of schedule. T-Mobile now covers 245 Wideband LTE markets and aims to surpass 260 markets by the end of this year. The company covers almost 175 million POPs with its Extended Range LTE service and is leading in average download speeds for the 7th quarter in a row.

As of this writing, shares of T-Mobile were up 2.9% at $42.55 per share in premarket trading.

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