T-Mobile adds subscribers as it grows wired Internet business

T-Mobile continued to grow its customer base in the first quarter of 2024, adding 1.2 million net customers across its phone and Internet businesses on the heels of two acquisitions, the company said during its first-quarter earnings call on Thursday. fair.

The first acquisition was the long-awaited $1.35 billion deal to buy prepaid carrier Mint Mobile, which the U.S. Federal Communications Commission approved yesterday, finalizing a process that began a year ago when T-Mobile announced it. The carrier also announced yesterday that it has entered into a joint venture with investment organization EQT to spend $950 million to acquire Lumos, a fiber internet provider, to gain access to its network, reaching 320,000 homes on the US East Coast with wired and Wi-Fi services.

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The acquisitions expand T-Mobile's investment in two areas: prepaid phone subscriptions and wired internet, the latter of which the carrier had largely ceded to rivals Verizon and AT&T in the past. To wit, Verizon ended the first quarter with 7.2 million wired broadband subscribers, while AT&T ended the same period with more than 8.5 million. To catch up, T-Mobile will invest another $500 million between 2027 and 2028 to expand the Lumos network to 3.5 million total homes by the end of last year, the carrier said in a statement. blog post.

During the earnings call, T-Mobile CEO Mike Sievert praised the Lumos management team for their “years of experience building fiber in an efficient, cost-effective and targeted build model. we have been working to reach more and more families in the coming years.”

That expansion came alongside more conventional growth in categories where T-Mobile has traditionally been competitive, like cellphone. The carrier added 532,000 net postpaid customers (a slight drop of 6,000 from Q1 2023), a metric the industry uses to denote success and reliable revenue. During the conference call, T-Mobile Consumer Group President Jon Freier noted that although people were holding on to their phones longer, leaving only about 2.4% of customers upgrading their devices during the quarter, they were leaving their subscriptions at the lowest rate in T-Mobile's history.

“It's really the best of both worlds when you have customers who get amazing rates, record low rates and don't stay exclusively with free devices,” Freier said. “They stay for this differentiated value proposition, the network and the overall experience.”

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Sievert added that 75% of postpaid customers had 5G phones and were therefore able to experience the best the network had to offer without the need for an upgrade. “So the impetus to switch it prematurely, when you're having a fantastic experience on your phone, just isn't there,” he said.

The operator reported losses of 48,000 net prepaid customers (including phone and internet) during the quarter, an overall reduction of 74,000 customers compared to the 26,000 added in the same period last year. That's still lower than the 216,000 prepaid phone losses suffered by Verizon and the 132,000 prepaid phone losses suffered by AT&T.

Sievert acknowledged the continued growth of its fixed wireless access base despite the end of launch-era promotions for the service, “attracting customers at our nominal prices.” T-Mobile added 405,000 FWA customers, down from the 523,000 added in the first quarter of 2023. The carrier ended the current period with 5.2 million total customers for its Internet service.

T-Mobile reported revenue of $16.1 billion for the quarter, up 4% from the same period last year. That dropped to $2 earnings per share, up 27% from $1.58 per share in Q1 2023.

T-Mobile shares fell slightly, 0.05%, later in the day.