Popularity Of Binge On Boosts T-Mobile Profits (TMUS.O)
T-Mobile US Inc reported that its profits had nearly tripled in the fourth quarter of its fiscal year. For the fourth quarter, net income rose to $297 million, or 34 cents per share, from $101 million, or 12 cents per share, a year earlier. The average estimate of Wall Street analysts was for earnings of 15 cents per share. Total revenue was 1.1 percent higher at $8.25 billion, besting the average analyst estimate of $8.20 billion. The company’s shares rose more than 1 percent in morning trading on the news.
The company attributed the profit jump to the popularity of its Binge On video streaming service. The company launched Binge On, in November, giving customers a way to stream video from services such as Netflix on their mobile devices without having it count against their data plans. The service has attracted numerous defectors from the company’s competitors in the past few months.
Lower priced cellular service plans also boosted the company’s profits for the quarter. In recent months, T-Mobile has introduced offers like data rollover and lower-priced phone leasing plans to lure customers from rivals. The company’s average revenue per postpaid user fell to $48.05 in the quarter, down from $48.26 a year earlier. However, that number still beat the $46.97 forecast by analysts polled by FactSet.
The No. 3 U.S. wireless provider said that it added 2.1 million subscribers in the quarter, including 1.3 million new monthly or postpaid customers. That brings its total customer count to more than 63 million. It was the 11th consecutive quarter that the company added more than 1 million new customers. For all of 2015, the company added 4.5 million new postpaid customers. T-Mobile expects that number to fall between 2.4 million to 3.4 million new postpaid customers added for 2016.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.