T-Mobile's cheaper plans, 5G edge help lift 2022 subscriber forecast again
T-Mobile US Inc (TMUS.O) on Thursday raised its annual forecast for monthly bill-paying wireless subscriber additions for a third time, as more Americans pick its superior 5G services and cheaper plans compared to rivals AT&T (T.N) and Verizon (VZ.N).
Shares in T-Mobile rose 3% in extended trading after the company also beat third-quarter estimates for wireless phone customer additions, helped by discounts on smartphones and plans at industry-low prices.
It also has an edge in the 5G game, owing to the chunky 2.5Ghz mid-band spectrum it won through its $23 billion buyout of rival Sprint in 2020, while Verizon and AT&T are building up the mid-band that provides a good balance of capacity and coverage.
So, while other telcos bear huge costs on 5G deployments, T-Mobile's roll-out has been less expensive and helpful in managing costs, CFRA analyst Keith Snyder said.
T-Mobile executives told Reuters a rebound in international travel, strong demand for its priciest $85 Magenta Max plan that is bundled with streaming services such as Apple TV+, pushed up subscriber additions and helped raise forecast across wireless additions, core adjusted earnings and free cash flow.
"T-Mobile has done a very good job of making the pricier plans more valuable to justify the cost," said Anshel Sag, analyst at Moor Insights & Strategy. Read More…
