T-Mobile saw its wireless business grow by 299,000 new accounts during the key retail holiday season last year, the company revealed in its quarterly earnings report on Thursday.
Around 1.6 million new postpaid lines were added during Q4 2023, with the company ending the year at 119.7 million wireless lines of service, a sequential increase of 1.8 million total wireless lines.
Around 934,000 new phones and related devices were activated during the key retail holiday season, T-Mobile said, though it wasn’t immediately clear if that figure included free wireless lines that the company often gives to its subscribers in the weeks leading up to the end of its financial quarter.
Historically, T-Mobile reports substantial gains in wireless accounts relative to its peers, but the company is also liberal with its offering of free wireless lines to customers with two or more paid lines on their account. The lines are often counted toward T-Mobile’s overall gain, even if customers don’t actively use them.
In any case, the strategy of offering holiday deals and discounts earlier in Q4 relative to prior years appears to have paid off for T-Mobile, just as it did for peer services Verizon and AT&T.
The increased handset and line activations during Q4 helped lift T-Mobile’s quarterly revenue to $16 billion and its year-end revenue to $63.2 billion, with the latter reflecting a 3 percent growth compared to the prior year. Net income clocked in at $2 billion for the quarter and $8.3 billion in 2023, with T-Mobile’s profit rising a whopping 236 percent on a year-over basis.
Postpaid average revenue per user, or ARPU, was nearly $49 by the end of the year, while postpaid average revenue per account, or ARPA, came in at just north of $140. The growth in both metrics was attributed to an uptake in T-Mobile’s fixed wireless broadband Interest product, called T-Mobile Home Internet, which added 541,000 during 2023.
“This was a historic year for T-Mobile, with record outcomes across nearly every metric and industry-leading customer results – including our highest share of postpaid phone net adds since the [Sprint] merger and best-in-class growth in service revenues, profitability and cash flow – all while effectively completing the largest, most successful telecom integration in the world,” Mike Sievert, the CEO of T-Mobile, said in a statement on Thursday. “What’s really exciting is that while we’ve delivered fantastic results, we’ve also got room to run. Thanks to the unmatched value and network leadership that we’ve built, we’re entering a phase of enormous value creation with a plan to deliver sustained customer and financial growth leadership. This is just the beginning of the next chapter for the Un-carrier.”
Executives said they expect to add between 5 and 5.5 million new customer lines during the year, with net income of $21.5 billion to $22.3 billion.
T-Mobile’s prepaid division saw more-modest gains during 2023, with the company growing its prepaid customer base to slightly more than 21.6 million by the end of 2023. The figure included around 53,000 new customers who signed on to T-Mobile’s prepaid service during Q4. The company offers prepaid phone plans through its T-Mobile Essentials, Connect by T-Mobile and Metro by T-Mobile brands.
It wasn’t clear how the planned sunset of the Affordable Connectivity Program (ACP) would impact T-Mobile’s business. The government-run program offered a $30 discount on the monthly cost of wireless phone or Internet service. T-Mobile offered the ACP benefit through Metro by T-Mobile.
