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Feb 1 (Reuters) – T-Mobile US Inc on Wednesday missed fourth-quarter revenue estimates despite adding nearly a million wireless subscribers, as rivals ramped up holiday handset deals for attract customers.
The US wireless carrier recently added thousands of wireless subscribers, thanks to smartphone discounts, industry-low plan prices and a 5G advantage, thanks to its takeover of Sprint Corp. in 2020 for $23 billion.
However, Verizon and AT&T ramped up their handset offerings this holiday season to capitalize on surging demand after the latest iPhone launch, hitting T-Mobile’s scorching growth.
The carrier added 927,000 postpaid phone subscribers in the fourth quarter, the highest among its peers.
But, its churn rate, which refers to the percentage of customers who have stopped using the company’s services, was also the highest compared to its competitors, at 0.92%. In contrast, Verizon reported a churn rate of 0.89% for monthly phone subscribers, while AT&T came in at 0.84%.
Additionally, executives hinted at slowing growth as demand for phones with video conferencing and premium plans that support remote working fades as offices reopen.
T-Mobile expects to add between 5 million and 5.5 million net subscribers paying monthly bills in 2023, up from 6.4 million reported additions in 2022.
The company earned $1.18 per share on revenue of $20.27 billion in the fourth quarter, versus an average analyst estimate of $1.10 per share on revenue of $20.60 billion, according to the data from Refinitiv.
Analysts are also seeking additional comment on the company’s recent data breach that may have exposed 37 million postpaid and prepaid accounts. The company had said it could incur significant costs related to the January incident.
Adjusted profit after deducting rental income is expected to be between $28.7 billion and $29.2 billion in 2023, up 10% year-over-year at the midpoint, T said. -Mobile.
Shares of the Bellevue, Wash.-based company fell 0.5% in premarket trading on Wednesday. (Reporting by Eva Mathews in Bengaluru; Editing by Shinjini Ganguli and Mark Porter)