T-Mobile expanded its customer base over the holiday season, ending the year with 6.4 million net additions in 2022, half of whom had subscribed to phone plans.
Phones led the charge for the carrier, which reported 927,000 postpaid phone additions during the quarter, the metric used by the industry as an indicator of success. It capped a year of growth for phones that resulted in an additional 3.1 million people signing up for monthly plans in 2022.
“We win the biggest share of switch decisions in the industry,” T-Mobile CEO Mike Sievert said on the earnings call. He did not say whether the carrier would change its promotional strategy, contrary to recent claims by AT&T and Verizon to end their aggressive phone deals that had been used to lure customers.
Sievert addressed the recent cybersecurity breach that reached 37 million T-Mobile customers, regretting that any information was exposed but noting that the carrier’s systems prevented access to “the most sensitive types of data”. The hack was the fifth offense in five yearsraising concerns about the safety of the carrier.
T-Mobile continued to slowly expand its 5G network, covering 265 million people with its midband and mmWave Ultra Capacity 5G, an increase of 15 million in the last quarter, with plans to expand to 300 million. by the end of 2023. Sievert said that of its 150 MHz of spectrum, 130 MHz is dedicated to midband 5G, which it aims to increase to 200 MHz by the end of 2023.
T-Mobile reported more modest prepaid net additions of 25,000 due to changing customer carriers, although the carrier noted that it was the only one with positive gains – Verizon lost 175,000 and AT&T lost 13,000 prepaid customers during the holiday season. Sievert viewed this as a healthy sign for the industry as customers continued to switch from prepaid to postpaid contracts.
T-Mobile’s Internet customer base grew with 524,000 net additions in the quarter, down slightly from the 578,000 added last quarter, as the carrier adjusts to growing customer base deactivations which rose to 2.6 million by the end of the year. Most of them use T-Mobile’s fixed wireless running on its 5G mobile network, which Sievert admitted in the call has lower overall bandwidth capacity than wired fiber internet, but is cheaper and available to tens of millions of homes without having to go through the hassle of laying cable, which makes it appealing to customers.
“Most of our [fixed wireless] customers are coming directly from cable, not just from rural areas or unconnected places or DSL,” Sievert said.
T-Mobile reported $15.5 billion in services revenue, up 4% year-over-year, resulting in diluted earnings per share of $1.18, an increase of 71% over the same period in 2021. That was above earnings of $1.10 per share. expected by analysts polled by Yahoo Finance.
T-Mobile shares edged up 0.5% in morning trading.
T-Mobile said it is on track to meet expectations for 2023, which includes finalizing its integration with Sprint’s network by the end of the year. The carrier had “substantially completed” the teardown of Sprint’s network in the third quarter of 2022. T-Mobile expects net postpaid customer additions of between 5 and 5.5 million, half of them on phones.
T-Mobile closed its quarterly report by pledging to achieve a sustainability goal of zero emissions across its entire carbon footprint by 2040, though the carrier didn’t provide any details on how it will. would achieve this goal.