T-Mobile (NASDAQ:TMUS) Earnings Smash Expectations

T-Mobile (NASDAQ:TMUS) Earnings Smash Expectations

T-Mobile US Inc (NASDAQ:TMUS) reported a profit for the fourth quarter that nearly tripled year over year, and its earnings exceeded analyst expectations by more than 100%. Total revenue for the quarter saw a 1.1% uptick as the company added 2.1 million net subscribers in the same period. The telecom service provider also added subscribers in the branded postpaid and prepaid in the December quarter.

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Outlook For 2016

T-Mobile is looking to add 2.4 – 3.4 million branded postpaid net subscribers this year. The ambitious target was based on the success of its Simple Choice plan, the continued adoption of its Un-carrier tactics, and network investment. The company has also guided its adjusted EBITDA to between $9.1 – $9.7 billion including leasing and Data Stash impact of $0.7 – $1.0 billion. The company is targeting cash capital expenditures of $4.5 – $4.8 billion for 2016.

As for the bottom line, T-Mobile reported net income of $297 million, up an astonishing 194.1% from $101 million while earnings per share jumped to 34 cents from 12 cents last year. Wall Street analysts expected the company to report earnings of only 15 cents a share. The company’s earnings had failed to meet the expectations in the third quarter, however. It was the exact opposite in the fourth quarter.

In a good sign of growth, the company added 1.3 million branded postpaid customers while 917,000 customers were added to the branded postpaid phone segment. The company added 469,000 customers in the prepaid category. T-Mobile said that it was the eleventh straight quarter of adding more than one million net subscribers and the third straight quarter of over two million additions.

Total Subscribers

T-Mobile further said that its recent quarter additions took the total number of subscribers to over 63 million at the end of 2015. For the full year, it was the second straight year of adding over eight million net subscribers. The company said that it demonstrated its strength and simply outperformed the industry. Its branded postpaid churn rate was 1.46% representing a 27 basis point drop year over year, meaning less customers are dropping the service, another good sign if improved performance.