T-Mobile’s service revenue in 3Q17
In the previous part of this series, we discussed analysts’ expectations for T-Mobile’s (TMUS) postpaid phone churn rate in 3Q17. In this part, we’ll look at T-Mobile’s expected service revenue growth in 3Q17. Service revenue is a stable revenue stream for wireless carriers such as AT&T (T), Sprint (S), Verizon (VZ), and T-Mobile. Analysts expect T-Mobile’s service revenue to rise ~6.5% YoY (year-over-year) to ~$7.6 billion in 3Q17.
In 2Q17, T-Mobile’s service revenue grew ~8.1% YoY to reach ~$7.4 billion. This YoY expansion was primarily due to growth in the telecom company’s subscriber base in existing and expansion markets, driven by Uncarrier plan initiatives and the MetroPCS brand.
T-Mobile’s postpaid and prepaid segments continued to fuel its service revenue growth in 2Q17. However, growth was higher in the prepaid segment. In 2Q17, service revenue in the postpaid segment grew ~6.9% YoY to ~$4.8 billion in 2Q17, and service revenue in the prepaid segment grew ~10.1% YoY to ~$2.3 billion.
Other US wireless carriers in 2Q17
In its peer group, T-Mobile saw the highest service revenue growth in 2Q17. That quarter, Verizon’s wireless service revenue fell ~6.7% YoY to ~$15.6 billion, AT&T’s wireless service revenue from domestic operations fell ~2.5% YoY to ~$14.5 billion, and Sprint’s wireless service revenue fell ~6.2% YoY to $5.7 billion.