1 Thing T-Mobile Doesn't Want You to Know About Its Second-Quarter Results
T-Mobile (NASDAQ: TMUS) reported its second-quarter earnings results last week, and it blew away analysts' expectations. While analysts expected a slight decrease in additions compared to last year (607,000), T-Mobile managed to add 786,000 net new subscribers. Last year, the company added 646,000 subscribers in the second quarter.
But not all subscribers are created equal. That's evidenced in the downtick in average revenue per subscriber at T-Mobile. Last quarter T-Mobile generated just $47.01 per month from each postpaid subscriber. That's down from $47.11 in the second quarter last year and $48.19 in 2015.
One explanation could be the launch of DIGITS last quarter. DIGITS allows users to use multiple numbers on one device or use a single number to ring multiple devices. Subscribers to T-Mobile's ONE Plus plan get a free DIGITS line, and additional lines cost $10 per month. And while these are virtual phone lines, T-Mobile still counts them as individual subscribers. Jonathan Chaplin of New Street Research estimates T-Mobile added 200,000 DIGITS lines last quarter.
Source: Fool.com
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