Wireless customers are still flocking to T-Mobile. That's the takeaway from preliminary fourth-quarter results the company announced Wednesday.
The Bellevue, Washington, company said it added a total of 2.4 million customers in the fourth quarter of 2018, of which 1.4 million were so-called postpaid monthly wireless customers. These are customers who pay their bills at the end of each month and are considered highly valuable. Analysts had expected the company to add 985,000 new postpaid subscribers, according to Bloomberg. The new subscribers include 1 million phone customers.
The company said this was the best quarter ever in terms of attracting new customers.
These additions likely top subscriber growth from its rivals. Just Tuesday, Verizon also announced strong customer growth for the fourth quarter, adding 650,000 new phone subscribers. But T-Mobile beat Verizon's growth.
AT&T and Sprint have yet to announce their subscriber numbers, but T-Mobile's strong performance, coupled with Verizon's results, likely means that AT&T and Sprint will disappoint in terms of customer growth. As the wireless market reaches maturation, the only way to grow is to steal customers from competitors, which is what T-Mobile has been doing for several quarters.
Meanwhile, T-Mobile also showed in the fourth quarter that it's retaining existing customers. The company said it improved its churn rate for postpaid subscribers, bringing that rate down to 0.99 percent in the fourth quarter from 1.02 percent in the previous quarter. The churn rate is the rate at which customers leave a service.
All of this comes as the majorthe next generation of wireless service that's expected to bring a big boost in speed and network responsiveness, opening the door to new services like streaming VR and telemedicine.
AT&T and Verizon plan to launch pockets of mobile 5G in 2019. Verizon CEO Hans Vestberg confirmed in an interview at CES that its first phone to support the new network will be the Motorola's Moto Z3, which is likely to launch in the next couple of months. Meanwhile, T-Mobile isn't expected to launch its mobile 5G network until 2020.
But T-Mobile has been aggressively growing its business by undercutting rivals and offering promotional deals. The company hasHowever, with 5G on the horizon, the company says it needs greater scale. It's currently awaiting regulatory approval for its $26 billion proposed merger with Sprint. T-Mobile's executives say Sprint's wireless spectrum will accelerate its 5G network plans.
T-Mobile will offer more information on its financials when the company officially reports earnings in February.
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