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Wednesday, 9 November 2016

T-Mobile Subscriber’s Growth Outpaces Verizon Wireless and AT&T




Somehow, T-Mobile has managed to post a profit. This profit has easily exceeded the estimate of analysts. It indicates that the third largest carrier in the US is successfully attracting new phone service subscribers in Kansas and rest of the United States with lower prices. And, the company is not punishing the bottom line in this process. 

T-Mobile Released a Statement:

T-Mobile, in a statement released Monday, said that the adjusted earnings before interest, tax, and depreciation as well as amortization, increased to $2.6 billion. Bloomberg carried out a survey in this regard. As per this survey by Bloomberg, Analysts had predicted this amount to be up to $2.4 billion. The company succeeded in adding almost 969,000 new service subscribers. This average number of new customers predicted by analysts was 829,000. 

What This Result Indicates:

This result is enough to show that Mr. John Legere, the Chief Executive Officer of T-Mobile, is finding more efficient ways for balancing user growth with the cost needed to keep new phone service users in Kansas and the rest of the US coming to the carrier. The shares of the company also rose by 7.5% to the amount of $50.25 Monday. This is T-Mobile’s highest amount of intraday gain in the two previous years. T-Mobile’s stock had been trading at $50.13 by 9:30 AM in the morning. It had gained 20% in 2016 by Friday’s close.

How did it Happen?

It was certainly not easy for the company. T-Mobile succeeded in winning many customers, especially because Verizon Wireless and AT&T struggled to live up to the expectations of their customers. Verizon Wireless came across the worse loss of subscriber growth in the time span of more than six years whereas AT&T had scheduled the announcement of results on Tuesday. Instead of this, the company announced results one and half hours after acquiring Time Warner INC. over the weekend. AT&T announced the eighth straight loss of phone service subscribers in Kansas and the entire US.

John Legere Tweeted!

Mr. John Legere, the CEO of T-Mobile took a dig at AT&T’s eighth straight losses through a tweet. “Yikes @ATT! Terrible Q3 results! Could explain the focus on buying another company. Any other diversion tactics!?” This is what he tweeted on Saturday night. A few days earlier, he had mocked Verizon also through a series of emoji tweets. According to him, his emoji tweets best represented the weak performance of the best carrier in the United States.

T-Mobile is Posting Profit Because…

There are a number of reasons for it. Let’s take a look at all of them below:
  • T-Mobile is pitching video streaming promotions strongly and free of cost. Binge On is the example.
  • Unlimited data plan for families and video lovers who love to watch videos on YouTube and Snap chat but are worried about data cost.
  • The demand of Apple’s iPhone 7 has been growing very strongly. Therefore, the company has introduced $160 unlimited data plans for families of four.
As for a price push, it has been considered to be a great threat for most of the big rivals. And the list of those rivals includes Verizon Wireless and AT&T.

Will T-Mobile be able to increase this profit in times to come? Rival carriers like Verizon Wireless and AT&T won’t sit quietly and sip coffee after posting such huge losses. The battle of wireless growth seems to be getting interesting. Let’s see who wins it!

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