Pre-paid users drive T-Mobile USA’s Q3 growth

9 Nov 2007

US mobile carrier T-Mobile USA added 857,000 net new subscribers in its fiscal third quarter ending 30 September to lift its base to 27.7 million, and attributed a significant part of the growth to increased sales of pre-pay SIM cards. Around 35% of the operator’s net additions during the third quarter were pre-paid, compared with just 4% in Q306 and 20% in Q207. The operator said the launch of FlexPay in July this year, which extended the range of pay-as-you-go options for pre-paid customers as well as those on contracts, helped drive much of the growth. Nonetheless, T-Mobile USA said that contract customers made up 84% of its subscriber base by the start of October. The cellco’s blended monthly average revenue per user (ARPU) was up USD1 year-over-year to USD53, and it trimmed its post-paid churn rate from 2.3% in the third quarter of 2006 to 2%. The company’s blended churn rate was also down, from 3% in Q306 to 2.9% this year.

T-Mobile USA said revenues reached nearly USD5 billion in the third quarter, and profits totalled USD526 million. The earnings figure was down from the USD1.79 billion profit recorded in the third quarter of 2006, which was boosted by a USD1.5 billion income tax credit during that quarter.

United States, T-Mobile US