T-Mobile rises 7% off subscriber beat-and-raise; other carriers gain
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T-Mobile (NASDAQ:TMUS) is sharply higher, up 7.1% Friday, as investors respond to a financial miss the way they are with other telecom/media names this earnings season - bidding it up on subscriber strength and an upbeat outlook.
The carrier missed revenue expectations by half a billion dollars, as total revenue fell slightly, despite service revenues that rose 4.3%. Of that, postpaid service revenues grew 7% year-over-year.
Those figures were goosed by T-Mobile's highest ever net additions for postpaid accounts.
Overall, net postpaid accounts rose by 394,000, vs. a year-ago gain of 268,000. The company easily topped expectations by adding 854,000 postpaid phone subs, beating AT&T and (by a long ways) Verizon on that measure.
Postpaid churn fell to 0.88%, while prepaid churn dipped to 2.88%.
It also provided a slight beat on its residential/business broadband subscribers. Net adds in high-speed Internet were 578,000, a sharp increase from year-ago gains of 134,000. The gains brought total high-Speed Internet customers to 2.12M.
And it raised guidance for the third time in 2022. For the full year, postpaid net adds are expected to come in at 6.2M-6.4M, up from previous expectations for 6M-6.3M. Core adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) forecasts are raised to $26.2B-$26.4B.
It raised its forecast for net cash from operations to $16.3B-$16.5B, from a previous $16B-$16.3B.
And "Based on the continued strength of execution, T-Mobile is raising its merger synergies guidance range to $5.7B to $5.8B in 2022, up from the previous range of $5.4B to $5.6B."
The upbeat subscriber results and outlook are raising all wireless boats Friday. Verizon (NYSE:VZ) is 3.9% higher, while AT&T (NYSE:T) is up 1.9%. Dish Network (NASDAQ:DISH) is up 0.6%.
For more detail, dig into Seeking Alpha's transcript of T-Mobile's earnings call.