The fourth quarter of 2016 was another good one US mobile operators.
AT&T, T-Mobile, Verizon and Sprint all gained both total customers and postpaid customers last quarter.
T-Mobile added 1.2 million postpaid, 541,000 prepaid, and 363,000 wholesale customers for a total gain of 2.1 million customers. That compares with gains of 1.97 million in Q3 2016 and 2.1 million a year ago in Q3 2015.
AT&T added 520,000 postpaid, 406,000 prepaid, and 1.27 million connected device subscribers, but lost 672,000 reseller customers for a total gain of 1.52 million subscribers vs gains of 1.53 million in Q3 2016 and 2.23 million in Q4 2015. AT&T blamed its loss of reseller customers on the shutdown of its 2G network.
Verizon added 591,000 postpaid connections but lost 9,000 prepaid customers for a total gain of 582,000 vs gains of 525,000 in Q3 2016 and 1.36 million in Q4 2015.
Sprint reported adding 405,000 postpaid and 673,000 wholesale customers but lost 501,000* prepaid users for a total gain of 577,000 customers vs gains of 740,000 in Q3 2016 and 491,000 million in Q4 2015.
* A footnote to Sprint's report say that "As a result of aligning all prepaid brands, including prepaid affiliate subscribers, under one churn and retention program as of December 31, 2016, end of period prepaid and affiliate subscribers were reduced by 1,234,000 and 21,000, respectively." I take that to mean that Sprint had over 1.25 million mon-paying, inactive prepaid and affiliate customers on its rolls at the beginning of the quarter, which it finally removed. As a result Sprint's reported prepaid subscriber count for Q4, 2016 (11.81 million) is 1.7 million lower than the 13.5 million that Sprint reported in Q3, 2016.
Verizon, AT&T and T-Mobile were profitable last quarter. Sprint posted its ninth quarterly loss in a row.
Verizon made a profit of $4.6 billion last quarter compared with $3.74 billion in Q3 2016 and 5.51 billion a year ago in Q4 2015.
AT&T made $2.44 billion last quarter compared with $3.23 billion in Q3 2016 and $4.01 billion in Q4 2015.
T-Mobile made $390 million last quarter compared with $368 million in Q3 2016 and $297 million in Q3 2015.
Sprint lost $479 million compared with losses of $142 million in Q3 2016 and $836 million in Q4 2015.
Here's how the operators ranked by total subscribers at the end of the quarter:
Verizon 143 million*
AT&T 134.9 million
T-Mobile 71.5 million
Sprint 59.5 million
*Estimated. Verizon doesn't report wholesale customer numbers. Verizon reported 114.24 million retail connections at the end of Q4, 2016. I estimate that Verizon has approximately 143 million total subscribers, including wholesale connections.
América Móvil's Tracfone subsidiary lost 417,000 subscribers last quarter. That compares with an acquisition driven gain of 1.2 million in Q3, 2016 and a loss of 58,000 in Q4, 2015. TracFone's gain in the Q3, 2016 quarter was entirely due to its purchase of Walmart Family Mobile and GoSmart which brought approximately 1.7 million customers to TracFone. TracFone's revenue was up 20.4% quarter over quarter and 7.9% year over year. TracFone operates the Straight Talk, NET10, Tracfone, Simple Mobile, Page Plus, Total Wireless, Telcel America, Walmart Family Mobile, GoSmart and SafeLink Wireless MVNO brands in the US.
Postpaid phone customers are generally much more profitable than tablet, connected device, prepaid and wholesale customers. Industry watchers put a lot of emphasis on postpaid phone customer gains and loses. T-Mobile once again lead the pack and added the most postpaid phone additions for the 12th consecutive quarter in a row. Only AT&T lost postpaid phone subscribers this last quarter.
The number of branded prepaid customers increased by 20 thousand, the tenth quarterly increase in a row. The gains came from T-Mobile and AT&T as Verizon, TracFone and Sprint all lost prepaid customers.
Total prepaid customers by carrier as of the end of last quarter were:
Tracfone 26.1 million
T-Mobile 19.8 million
AT&T 13.54 million
Sprint 11.81 million
Verizon 5.45 million
In summary, T-Mobile once again lead the industry in all four main growth metrics: total customer adds, total postpaid adds, total postpaid phone adds and total prepaid additions. 2016 marked the third year in a row that T-Mobile added over 8 million customers. AT&T and Verizon are highly profitable but Verizon's growth has stagnated and AT&T lost lucrative postpaid phone subscribers as well as over 600 thousand wholesale customers. Money losing Sprint posted good postpaid subscriber growth but its prepaid business continues to slide. TracFone lost customers but increased revenue.