T-Mobile US's third-quarter profit rose as the company continued to add postpaid subscribers and earn more revenue from those customers.
The cell carrier's results topped Wall Street's expectations on profit and revenue, as well postpaid net account additions, a key metric that tracks its offerings where service is paid for each month on a contract.
Despite the beat, T-Mobile said it now expects full-year postpaid net account additions at the midpoint of its prior guidance range. The company also narrowed its profit forecast for the year.
Third-quarter profit came in at $3.46 billion, or $3.22 a share, compared with $2.71 billion, or $2.41 a share, a year earlier. Analysts polled by FactSet had expected earnings of $2.89 a share.
Revenue rose 7.4% to $23.58 billion, compared with analyst estimates of $23.15 billion.
The growth was driven by a 9% year-over-year increase in postpaid service revenue, which came in at $16.27 billion.
T-Mobile said it added 274,000 postpaid net accounts in the quarter, including in phone and broadband, compared with Wall Street's estimate for about 250,900 additions. The company's postpaid phone service is its most lucrative phone offering, where service is paid for each month on a contract.
Average monthly postpaid service revenue earned per account grew 4% year over year to $155.73.
Chief Executive Srini Gopalan said the results show the company's value proposition is resonating among all customers.
He added that the company sees strong runway for growth ahead across its core wireless business and broadband, as well as what he called smart adjacencies.
"We're just getting started," Gopalan said.
For the full year, T-Mobile now expects postpaid net account additions of about 1 million, at the midpoint of its prior forecast of 950,000 to 1.05 million.
The Bellevue, Wash., company also narrowed its projection for core adjusted earnings before interest, taxes, depreciation and amortization to a range of $37.35 billion to $37.45 billion from a prior forecast of $37.1 billion to $37.5 billion, or up $100 million at the midpoint.
The results and guidance come as T-Mobile and the other leading wireless carriers contend with a potential new competitor in SpaceX. The company recently signed an $8 billion deal to buy cellular spectrum licenses, and has said it wants to move its Starlink satellite service beyond broadband, which would encroach on AT&T, Verizon and T-Mobile's turf.
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