Why T-Mobile’s Revenue Has Continued to Rise in 2Q17



T-Mobile’s revenue trend over the past few quarters

Earlier in this series, we learned that T-Mobile’s (TMUS) earnings grew YoY (year-over-year) during 2Q17. In this part, let’s look at T-Mobile’s top-line performance over the last few quarters. In 2Q17, T-Mobile’s total revenue came in slightly above the consensus estimate of $9.8 billion. T-Mobile generated total revenue of $10.2 billion in 2Q17, a 10.0% increase YoY.

This increase was mainly due to strong ~8.1% service revenue growth from $6.9 billion in 2Q16 to $7.4 billion in 2Q17. The growth was due to the expansion of the company’s customer base and success seen by its MetroPCS prepaid brand and Uncarrier plan initiatives.

Also, equipment revenue rose ~14.5% YoY from $2.2 billion in 2Q16 to $2.5 billion in 2Q17 as the carrier promoted its EIPs (equipment installment plans). In installment plans, customers pay for devices in monthly installments.

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Performance of other significant US wireless carriers in 2Q17

During 2Q17, Verizon’s (VZ) wireless revenue fell ~1.9% YoY to reach ~$21.3 billion. Meanwhile, AT&T’s (T) wireless revenue from domestic operations fell ~2.3% YoY to ~$17.5 billion, and Sprint’s (S) wireless revenue rose ~2.8% YoY to $7.8 billion. Therefore, T-Mobile saw the most growth among competitors. Continue to the next part for a discussion on T-Mobile’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) margin.


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