T-Mobile delivered second quarter results that were well ahead of expectations as the company continues to grab market share and add customers.
The wireless carrier said it delivered 1.3 million total net additions with 817,000 postpaid (786,000 postpaid phone) and postpaid churn of 1.1 percent.
As for the financials, T-Mobile reported net income of $581 million, or 67 cents a share, on revenue of $10.2 billion, up 10 percent from a year ago.
Wall Street was expecting to report second quarter earnings of 38 cents a share on revenue of $9.81 billion.
T-Mobile rattled the wireless industry with unlimited data plans and “uncarrier” promotions and grabbed market share. Rivals such as Verizon have rolled out unlimited data plans to counter T-Mobile. Ahead of earnings, T-Mobile was the subject of merger and acquisition talks. Sprint is the usual suspect when it comes to T-Mobile rumors. CEO John Legere spent a good bit of time talking about the rumors, but ultimately noted that these mergers would happen over time.
In addition, T-Mobile, which has plenty of spectrum to expand, is seen as a key player as distribution and content merge. Sprint, Comcast and Charter have been reportedly talking; AT&T and Time Warner are merging and Verizon and Disney have been rumored too. Drexel Hamilton analyst Barry Sine said T-Mobile would be a good partner for Netflix and/or Fox.
While the M&A chatter will continue, T-Mobile said it will ramp its business with more stores as well as network expansion. T-Mobile is also seeing traction in the enterprise.
G. Michael Sievert, operating chief of T-Mobile, said:
We refer to the group as the app worker group. I think we mentioned in our remarks that 181 new logos across large enterprise and public sector in the last quarter. Now 40% of the Fortune 1000. What we didn’t mention and this is really interesting is that our share in that Fortune 1000 and public sector is still very low. Our market share is still very low. What we’ve established now, our successful relationships from which we can grow.
As for the outlook, T-Mobile said it will add 3 million to 3.6 million net postpaid customer additions in 2017, up from 2.8 million to 3.5 million. T-Mobile also said its adjusted EBITDA target will be $10.5 billion to $10.9 billion.
The second quarter is typically slow for wireless carriers so T-Mobile’s results are likely to stand out as rivals report.
T-Mobile ended the quarter with 69.6 million customers.