The third-quarter earnings has ended and now that the figures and dust have settled – where exactly how did the nation's top wireless carriers fare against one another. It has been a long hard fought year so far – T-Mobile continues in its Uncarrier Mission, AT&T quickly reacted and made some changes of their own, Sprint got a new CEO and started making changes, especially in the data area, and good old Verizon kept plugging along with nary a change in its attitude or pricing. Because TracFone piggybacks on Verizon, AT&T and other top carriers, they were also included in the latest study by Jackdaw Research. Let us check out some of their findings below in the graphs at the bottom of the article.
From the Revenue Growth Chart – When it comes to revenue growth, the surprising winner is actually TracFone – with prices rising, are more people jumping to the cheaper prepaid options? T-Mobile was tops in the major four, due to its rapid customer growth rate…they are stealing a lot of customers from the other networks and combined with their low churn rate – one of Sprint's major problems. Verizon and AT&T chugged along with both showing slight year-over-year increases.
From the EBITDA Margins – We see that when you have a 'fire sale' like T-Mobile has been doing, rapidly increasing their customer base and revenue earnings via cheaper pricing and buying out Early Termination Fees – the actual earnings suffer in the end, making them the lowest in EBITDA. We also see what happens when you go with a steady business plan, like Verizon, the revenues may not be as great, but their earnings are tops…once again. Sprint actually fared very well in the Q3, but they have to figure out how to steadily increase growth and revenue without hurting their continued earnings.
In the Total Net Adds For Big 5 – We are also starting to see other devices besides phones as a driving force for increases for the carriers. In the past, phones were always the driving force in net adds, however, this year both tablets and connected devices bumped phones into third place! Verizon is the tablet leader right now and is adding a million tablets in each quarter with no slowdown in sight. As prepaid users get to enjoy some flexibility in plans, once reserved only for postpaid subscribers, there has also been a real growth in that area as well. Both AT&T and Sprint were strong in the connected devices categories that were driven by connected car deployments.
The ARPU Postpaid – Is one of the most complex metrics for analysts to determine, especially when you must factor in the new installment billings, especially AT&T and T-Mobile as they push that service. Then you have Verizon, that offers it, but does not highlight it and continues to use Average Revenue Per Account, rather than User. Therefore, after taking all of these factors into account, the chart you see is their best guess showing the separate postpaid and prepaid results for AT&T and T-Mobile…and once again, the conservative based Verizon moves steadily along.
In the Smartphone Sales chart – Although all carriers saw an increase in sales thanks to the new iPhone 6, even though it was released near the end of the third quarter, surprisingly, Verizon is at the top of the charts by a large margin. They were unable to determine Sprint's total sales the third quarter and on another interesting note – both AT&T and T-Mobile sold the same number of smartphones during the second AND third quarters, hence their data points overlap.
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