The wireless industry is expected to post solid third-quarter results, including strong customer additions and average revenue per user results bolstered by seasonality and modest pricing competition, which may be tempered by a slight increase in customer churn due to the back-to-school season, according to a preview report from UBS Warburg.
The financial analyst firm noted that its previous guidance of 19.5 million net customer additions for the year, which was revised from 12 million net additions, may be conservative as the carriers the firm tracks posted nearly 10 million net additions for the first half of the year.
Of the nationwide carriers it follows, Nextel Communications Inc. is expected to post approximately 500,000 net customer additions, excluding its Boost Mobile L.L.C. prepaid offering, with customer churn of around 1.65 percent and $69 in ARPU. Nextel reported 646,000 net customer additions during the third quarter of 2003 with 1.4-percent customer churn and $71 in ARPU.
Sprint PCS is forecast to add 394,000 internal direct net customer additions during the quarter compared with 184,000 net customer additions last year. Customer churn is expected to drop from 2.68 percent during the third quarter of 2003 to 2.55 percent this year with ARPU dropping from $62.84 last year to $62 this year.
AT&T Wireless Services Inc. is expected to post around 79,000 net customer additions during the third quarter compared with 229,000 net additions last year, with customer churn rising from 2.7 percent last year to 3.4 percent this year and ARPU dropping 3.5 percent year-over-year from $61.20 in 2003 to around $59 this year.
