Getting the word out early for a quarter that is typically generous to its operations, MetroPCS (PCS) and Leap Wireless (LEAP) both announced limited fourth-quarter results today that proved a mixed bag for the no-contract operators.
MetroPCS said it added 197,410 customers during the final three months of 2011, which was well below the 297,726 customers the carrier added during the fourth quarter of 2010. An increase in customer churn from 3.5% in 2010 to 3.7% in 2011 was a significant contributor to the drop in customer growth as gross customer additions actually increased 7% year-over-year.
For the full year, MetroPCS said it added more than 1.19 million customers, compared with more than 1.5 million net customer additions for 2010. Churn was also a factor in that dip as defections increased from 3.6% in 2010 to 3.8% last year. MetroPCS ended 2011 with more than 9.3 million customers.
Rival Leap said it added about 175,000 customers during the fourth quarter, including 200,000 voice customers that were presumably offset by the loss of 25,000 mobile broadband subscribers. The carrier has been de-emphasizing its mobile broadband offering in favor of its smartphones, which are less of a capacity drag on its mobile network.
Leap also reported that it added 65,000 customers to its network that are outside of its own network operations. This is possible through the extensive roaming agreement the carrier signed with Sprint Nextel as well as increased distribution channels.
Leap said it expects fourth-quarter churn to come in at between 3.7% and 3.9% once results are finalized.
Both carriers tend to post more robust quarterly results around the holiday periods that are then tempered by slower growth during the spring and summer.
For the year, Leap said it added 413,000 customers to its network, ending 2011 with nearly 5.9 million subscribers.
Investors were down on the early earnings releases, with MetroPCS’ stock trading down 9% early Thursday, while Leap’s stock was down 9.5%. Wells Fargo Securities noted that a sell-off was likely as recent weeks had shown increased expectations for the carriers.
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