T-Mobile US reported accelerated customer growth, all-time record-low postpaid phone churn of 0.88%, and record first quarter financials.
Q1 marked the 24th quarter in a row where T-Mobile delivered greater than 1 million total customer net additions.
Some highlights:
- Total net customer additions were 1.7 million in Q1 2019, bringing our total customer count to 81.3 million, and marking the 24th straight quarter in which T-Mobile generated more than 1 million total net customer additions.
- Branded postpaid net customer additions were 1.0 million in Q1 2019.
- Branded postpaid phone net customer additions were 656,000 in Q1 2019, up 39,000 from Q1 2018, and Q1 2019 is expected to be the 21st consecutive quarter in which T-Mobile leads the industry in this category. Branded postpaid phone net customer additions increased year-over-year primarily due to record-low churn.
- Branded postpaid other net customer additions were 363,000 in Q1 2019 primarily due to continued strength in gross customer additions driven by wearables.
- Branded prepaid net customer additions were 69,000 in Q1 2019, down year-over-year primarily due to continued promotional activities in the marketplace, partially offset by lower churn.
- Branded prepaid churn was 3.85% in Q1 2019, down 9 basis points year-over-year.
- Total service revenues increased 6% to a record-high of $8.3 billion in Q1 2019. These results represent our best quarterly performance ever and we expect to lead the industry for the 20th consecutive quarter in year-over-year service revenue percentage growth. Branded postpaid revenues increased 8% year-over-year.
- Total revenues increased 6% to $11.1 billion in Q1 2019 driven by growth in both Service revenues and Equipment revenues.
- Branded postpaid phone Average Revenue per User (ARPU) decreased to $46.07 in Q1 2019, down 1.3%. The decrease was primarily due to a reduction in regulatory program revenues from the continued adoption of tax inclusive plans, a reduction in certain non-recurring charges, the growing success of new customer segments and rate plans, including T-Mobile for Business, and the impact of the ongoing growth in our Netflix offering, partially offset by higher premium services revenue and a net reduction in promotional activities. For 2019 as a whole, we still expect ARPU to be generally stable within a range from plus 1% to minus 1%.
- Branded prepaid ARPU decreased to $37.65 in Q1 2019, down 3.2%, primarily due to dilution from promotional rate plans and growth in our Amazon Prime offering, partially offset by certain non-recurring charges.
- Net income increased 35% to $908 million and EPS increased 36% to $1.06 in Q1 2019 primarily due to higher Operating income and lower Interest expense. The negative impact from merger-related costs on Net income and EPS was $93 million and $0.11, respectively.
