T-Mobile Adds 1 Million-Plus Customers, Sold 5.6M Smartphones

T-Mobile's un-carrier moves are working, its third-quarter results made clear. The next pain point to address: family plans.

In a wireless market nearing saturation, new customers are key, and during the third quarter of 2013, T-Mobile added more than 1 million new customers—648,000 of who were postpaid phone additions.

It was its second consecutive quarter of adding more than 1 million customers.

"And we're talking about phone net adds, that's excluding tablets and other connected devices," T-Mobile CEO John Legere said during the carrier's Nov. 5 earnings call.

Legere called the quarter "outstanding" and said T-Mobile continues working "to change this stupid, arrogant industry."

The nation's fourth-largest carrier, behind Verizon Wireless, AT&T and Sprint, respectively, has branded itself the "un-carrier," and the tactic is working.

T-Mobile sold 5.6 million smartphones during the quarter, only 15 percent of which were iPhones. ("We could have done better had we had more supply during the launch," Legere said.)

The carrier also announced that more than 2.2 million customers had joined JUMP!, its $10-per-month upgrade plan, and it ended the quarter with 45 million customers.

Earnings were $1.34 billion, up 6.2 percent quarter-over-quarter, and revenues were up 8 percent quarter over quarter—due to the growth of its subscriber base, as well as the inclusion of the results of MetroPCS, the fifth-largest carrier that T-Mobile finished acquiring earlier this year—though the carrier posted a $36 million loss. Still, this was a world away from the nearly $8 billion loss it suffered a year ago, with no LTE network, no iPhones to sell, no un-carrier moves and a giant charge related to its merger with MetroPCS.

More than 1.5 million MetroPCS customers are now on the T-Mobile network. During the quarter, T-Mobile expanded MetroPCS into 15 new markets, and during the call officials said 15 additional markets—including Cincinnati, Dever and Portland—are going live Nov. 21.

Its LTE network, ahead of schedule, is now in 254 metro areas.

In October, T-Mobile also concluded its acquisition of 10MHz of Advanced Wireless Services (AWS) spectrum from U.S. Cellular for $308 million, which CTO Neville Ray called "fuel in the tank," though he added that T-Mobile plans to "push very hard" in 2014 for additional spectrum acquisitions.

Year of the Un-Carrier

T-Mobile has had a very busy year. In April it announced the first of its un-carrier moves–"Un-Carrier 1.0"—ditching two-year contracts and offering new Simple Choice plans. In July it introduced JUMP! (Un-Carrier 2.0), and in October (version 3.0) it announced unlimited data and texting for Simple Choice customers. Later in the month came the offer of 200MB of free data each month for tablet customers, encouraging the purchase of tablets with cellular connectivity.

"We think it's insane that most tablet owners don't sign up for high-speed wireless because they're afraid of data fees and overages," Legere said during the call.