T-Mobile boasted a strong quarter of wireless customer growth, even as the pace of expansion in its 5G home internet business slowed, as it swung to a big profit.
The wireless carrier said that in the fiscal second quarter, it added a net new 1.7 million customers, and 760,000 post-paid phone subscribers, or customers who sign longer term commitments have typically boast higher credit scores.
On the 5G home internet front, T-Mobile added 509,000 customers in the period, down a bit from the first quarter and year-ago period, signaling a cooldown in its rate of growth. Still, the company notes that its new customers outpaced its telecom and cable companies combined, based on reported numbers and analyst estimates.
T-Mobile has a total base of 3.7 million high-speed internet customers.
The results underscore the growing importance of 5G home internet service as both a source of growth for the company, and a new alternative for consumers looking for different broadband options. Verizon said it added 384,000 net new 5G home internet customers, and AT&T wants to expand its burgeoning Internet Air service.
T-Mobile CEO Mike Sievert touted the positive reception the service has had from its relatively young base of customers.
“We really, really like what we’re seeing from retention,” he said on a Thursday investor conference call, noting that the customer turnover rate has fallen sequentially.
Sievert added that the company is essentially “selling excess capacity on our network” with its home broadband service, and limiting households to areas where it wouldn’t hurt its core mobile service.
CFO Peter Osvaldik said T-Mobile was holding trials of using millimeter wave spectrum, higher frequency airwaves that boast huge capacity for data, but very limited range, but there were no plans to use it for the home service. T-Mobile uses the so-called mid-band 2.5 mhz spectrum that offers a nice compromise of speed and range.
Verizon kicked off its own home 5G service using millimeter wave spectrum, but that slowed its early expansion.
In total, the company posted a net profit of $2.22 billion, or $1.86 cents a share, on total revenue of $19.2 billion. Analysts, on average, expected earnings of $1.69 per share on revenue of $19.3 billion, according to Yahoo Finance.
T-Mobile is confident enough in its wireless business that it’s increasing its projected range for full-year new post-paid customers to 5.6 million to 5.9 million from a prior range of 5.3 million to 5.7 million.