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T-Mobile Lost 50,000 More Subscribers In Q2 2011

PETER SVENSSON   08/ 4/11 03:34 PM ET   AP

NEW YORK — T-Mobile USA continued to lose wireless customers in the second quarter, but did a better job of keeping them than it had during the first three months of the year, when subscribers fled in record numbers.

Still, the No. 4 wireless carrier in the U.S. on Thursday posted a record revenue decline of 6 percent from last year, as it sold fewer phones.

Germany's Deutsche Telekom AG has agreed to sell T-Mobile USA to AT&T Inc. for $39 billion. The deal could close next year, if regulators clear it.

The ailing nature of T-Mobile USA's business is being held up as one reason it should be approved. As the smallest of the four national carriers, Bellevue, Wash.-based T-Mobile USA seems to have a hard time competing, as does No. 3 Sprint Nextel Corp.

Deutsche Telekom has said it's unwilling to invest further in T-Mobile USA, leaving it hamstrung as AT&T and Verizon Wireless, the largest U.S. carriers, build faster wireless data networks.

T-Mobile USA lost 50,000 subscribers in the April-to-June period, to end with 33.6 million.

T-Mobile USA lost 281,000 contract subscribers, who are the most lucrative. It was the fourth straight quarter of losses in the category.

The carrier also lost no-contract subscribers, but compensated to some extent by adding 300,000 subscribers through resellers. Such subscribers are the least valuable.

T-Mobile USA is still profitable, but second-quarter net income of $212 million was just more than half of last year's $404 million.

Revenue was $5.05 billion, the lowest figure since 2007. The money it made from phone sales declined by 35 percent to $380 million.

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Filed by Catharine Smith  |  Report Corrections