The fourth largest telecom giant in the nation rose above expectations with a net gain of 173,000 postpaid subscribers in the second quarter of the year, which also includes several government cell phone plans. With the aid of heavy discounts and free cell phone services, the company managed to attract more subscribers for any first quarter in the past nine years. In contrast to a pervious net loss of 12,000 customers last year at this time, the company seems to be on cloud nine with the significant addition this quarter which ended June 30.
The company also faced a lower postpaid phone churn of 1.39 percent in the second quarter which is an improved churn over the last five quarters. Another achievement was that it’s postpaid base is net positive against the other three rivals. For the first time in the more than 5 years it has gained more subscribers from each of the rivals than it lost.
Though the company reported a considerable number of customer gains with certain plans including government cell phone plans, these came at a good cost. The loss figures soared to $302M, which is much larger than its $20M loss last year for the same period. Not only this, the wireless revenue topped at $6.1 billion rather than expected $6.2 billion expected by those at Wells Fargo Securities.
CEO Marcelo Claure shared "We had another quarter of solid progress in our turnaround, with the highest first-quarter postpaid phone net additions in nine years, the lowest postpaid phone churn in company history, and finally being postpaid net port positive against all three national carriers after five years," "We also grew wireless net operating revenue year-over-year while aggressively reducing the cash operating expenses of the business and our network is performing better than ever."
The contract termination charges totaled $113M, mostly related to a deal with Ntelos. The net operating revenue dropped to $8.01 billion, against $7.98 billion predicted by the analysts at Thomson Reuters.
The company also faced a lower postpaid phone churn of 1.39 percent in the second quarter which is an improved churn over the last five quarters. Another achievement was that it’s postpaid base is net positive against the other three rivals. For the first time in the more than 5 years it has gained more subscribers from each of the rivals than it lost.
Though the company reported a considerable number of customer gains with certain plans including government cell phone plans, these came at a good cost. The loss figures soared to $302M, which is much larger than its $20M loss last year for the same period. Not only this, the wireless revenue topped at $6.1 billion rather than expected $6.2 billion expected by those at Wells Fargo Securities.
CEO Marcelo Claure shared "We had another quarter of solid progress in our turnaround, with the highest first-quarter postpaid phone net additions in nine years, the lowest postpaid phone churn in company history, and finally being postpaid net port positive against all three national carriers after five years," "We also grew wireless net operating revenue year-over-year while aggressively reducing the cash operating expenses of the business and our network is performing better than ever."
The contract termination charges totaled $113M, mostly related to a deal with Ntelos. The net operating revenue dropped to $8.01 billion, against $7.98 billion predicted by the analysts at Thomson Reuters.
With a close at $4.62, the telecom company’s shares rose 27.6% since the beginning of the year.
Though the company has won postpaid customers in the country, but the analysts show doubt about how it is going to improve its network without increasing the capital expenditure.
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