T-Mobile CEO Mike Sievert introduces the new streaming platform ‘TVision’ and explains how it differs from other services.
T-Mobile US Inc. said its nearly one-year merger with Sprint Corp. will overburden the combined company with more costs this year, as its engineers transfer more subscribers to a single network.
The Bellevue, Washington, company said it would spend $ 2.5 billion to $ 3 billion without taxes doubling the stores, employees and network infrastructure acquired from its former competitor for the new business. The company spent about $ 1.9 billion on these expenses last year.
T-MOBILE CREATES THE RHYTHM OF ITS CORT-CUTTING PROGRAM
The additional burden pushed T-Mobile’s fourth quarter net income to $ 750 million, or 60 cents per share, compared with the previous year’s result of $ 751 million, or 87 cents per share. The latest quarterly result included $ 686 million of merger costs. Revenue jumped to $ 20.3 billion from $ 11.9 billion a year earlier, before the company absorbed Sprint.
T-Mobile closed its purchase from smaller competitor Sprint last year after a two-year legal campaign that culminated in a federal court ruling in its favor.
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| TMUS | T-MOBILE US | 130.60 | +1.23 | + 0.95% |
The merger left the US with three major operators that spent the past year fighting each other and a collection of smaller brands for new customers. T-Mobile reported in January a net gain of 824,000 postpaid phone connections in the fourth quarter. Rival AT&T Inc. said it added 800,000 of those top customers. Verizon reported a net gain of 279,000 postpaid phone connections.
T-MOBILE TAKES EMPLOYEES MONTHS AFTER THE $ 26 BILLION SPRINT MERGER
T-Mobile has also continued to add devices other than cell phones, including tablets and Internet access points, to its cellular network. She reported a net gain of 794,000 postpaid connections in the fourth quarter.
The operator said on Thursday it had made more progress in integrating Sprint’s customer base, with 25% of Sprint’s postpaid customer traffic already flowing through T-Mobile’s systems, representing about 4 million subscribers.
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T-Mobile executives have versatile mid-range wireless airwave licenses obtained with the purchase of Sprint to fuel their company’s growth in the years to come. Engineers have already put part of the valuable spectrum to work, transporting ultra-fast fifth generation, or 5G, wireless services across much of the country.
Executives said the additional cost of putting the two companies under one roof would be more than covered by the future cost savings of a simpler organization. They also pointed to faster wireless downloads as a reason for the company’s revenue to continue to improve.
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“We have mainly competed in price in the past, to be honest,” said Chief Executive Mike Sievert during a live broadcast conference. “Now, we have a premium product.”