T-Mobile US Q2 adjusted EBITDA increased 36% year-over-year
Staff Writer |
T-Mobile US reported second quarter 2016 results.The company added 1.9 million total net customers while delivering 12% growth in service revenue and 36% growth in adjusted EBITDA year-over-year.
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T-Mobile saw ongoing strength in branded postpaid customers with net additions of 890,000 in the second quarter of 2016. The sequential and year-over-year decline was primarily due to the absence of iconic device launches in the period.
Branded postpaid phone net customer additions were 646,000 in the second quarter of 2016, and T-Mobile led the industry in this metric for the 10th consecutive quarter.
Branded prepaid net customer additions were 476,000, up 167% year-over-year primarily driven by MetroPCS. Wholesale net customer additions were 515,000 in the second quarter of 2016.
Branded postpaid phone churn was a record-low 1.27% in the second quarter of 2016, down 6 basis points compared to 1.33% in the first quarter of 2016 and down 5 basis points compared to 1.32% in the second quarter of 2015.
Branded prepaid churn was 3.91% in the second quarter of 2016, compared to 3.84% in the first quarter of 2016 and 4.93% in the second quarter of 2015.
Service revenues grew by 12% year-over-year, primarily due to continued growth in the company’s customer base. This marks the ninth consecutive quarter that T-Mobile has led the industry in year-over-year service revenue percentage growth.
T-Mobile’s total revenues for the second quarter of 2016 grew by 13% year-over-year, which also led the industry for the twelfth time in the past thirteen quarters.
Branded postpaid phone Average Revenue per User (ARPU) of $47.11 in the second quarter of 2016 was up 1.9% sequentially and down 2.2% year-over-year.
Excluding the impact of Data Stash, branded postpaid phone ARPU was generally stable both sequentially and year-over-year as continued strategic focus on family plan penetration, promotional activity, and Un-carrier initiatives were offset by higher data attach rates and growth in insurance programs revenue.
Branded postpaid Average Billings per User (ABPU) was $62.59 in the second quarter of 2016. Excluding the impact of Data Stash, branded postpaid ABPU was also generally stable both sequentially and year-over-year. Branded postpaid customers per account grew to 2.64 in the second quarter of 2016, up from 2.43 in the second quarter of 2015.
In the second quarter of 2016, Adjusted EBITDA increased by 36% year-over-year to $2.464 billion, due to growth in the customer base and lower losses on equipment, partially offset by higher SG&A expenses due to strategic investments to support the growing customer base, and a higher non-cash impact of Data Stash.
The Adjusted EBITDA margin was 36% for the second quarter of 2016, compared to 30% in the prior year.
The aggregate impact from leasing and Data Stash on Adjusted EBITDA in the second quarter of 2016 was $279 million, including lease revenues of $367 million offset by the non-cash impact from Data Stash of $88 million.
Net income amounted to $225 million, down from $479 million in the first quarter of 2016 and down from $361 million in the second quarter of 2015. Earnings per share (EPS) in the second quarter of 2016 was $0.25, compared to EPS of $0.56 in the first quarter of 2016 and $0.42 in the second quarter of 2015.
The sequential decline in EPS was due to the after-tax impact of $0.46 related to the spectrum gain included in EPS for the first quarter of 2016.
The year-over-year decline was primarily due to higher interest expense and lower interest income in the second quarter of 2016, and lower income tax expense in the second quarter of 2015, partially offset by a higher operating income in the second quarter of 2016.
Net cash provided by operating activities was $1.768 billion in the second quarter of 2016, up from $1.161 billion in the second quarter of 2015.
Free cash flow was $419 million in the second quarter of 2016, compared to an outflow of $30 million in the second quarter of 2015.
Adjusted free cash flow was $485 million in the second quarter of 2016 compared to $73 million in the second quarter of 2015. ■
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