SunCom’s customer growth down, ARPU up

Regional carrier SunCom Wireless Holdings Inc. reported mixed metrics for the first quarter of 2007, but cut its losses compared with the year-ago period.
The company, which operates in the southeast and Puerto Rico, improved its average revenue per user and cut its churn rate, but its net customer additions were down more than 18% compared with the same period in 2006. SunCom gained about 33,650 net subscribers last quarter, more than 20,000 of which came from its domestic operations. That figure was significantly lower than the nearly 41,300 customers that the company added during the first quarter of 2006. Gross additions were down by about 7% year-over-year to about 108,000 customers.
SunCom recorded a net loss for the quarter of nearly $29 million, much improved from the year-ago loss of more than $147 million.
Michael Kalogris, SunCom’s chairman and CEO, said that the company’s ARPU strategy was working, and the metric was indeed a bright spot. ARPU was at $55.70, a sequential improvement of 1% and up more than $4 from the first quarter 2006 ARPU of $51.55. SunCom said that the ARPU increase “reflects the addition of subscribers at higher access points, higher-feature revenues and higher miscellaneous revenues.”
SunCom’s U.S. churn rate was unchanged year-over-year at 2%, while the company reduced its churn rate in Puerto Rico from 4% in the first quarter of 2006 to 2.7% for the same period this year.
Service revenues were up nearly 20% to $186.4 million for the quarter, and the company ended the first quarter with more than 1.1 million customers.