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MetroPCS misses subscriber estimates, but optimism abounds

Whenever you see that a company misses anything in its quarterly statement, it always causes concern. Yet for MetroPCS there is plenty of hope amid their disappointing first quarter. They added just 132,000 subscribers from January through March, which is not only down significantly from the 726,000 they added a year ago, but also considerably lower than their target of between 236,000 and 400,000 adds. Other carriers did struggled with new subscriber additions in the last quarter, but MetroPCS’s was a bit worse than the norm. Yet there were some positive notes during the earnings call.

The rate at which MetroPCS is building out its LTE network certainly warrants a positive mention. They currently have 80 percent of their total CDMA network covered, and plan to raise that to 95 percent within six months. That will create a greater market for LTE smartphones, of course, and Metro has a plan for that as well. They said that they will indeed have LTE Android handsets from LG, Huawei, Samsung, and ZTE available in the second half that will fit into their $99 to $150 price range. That could certainly represent a sweet spot for potential customers.

MetroPCS also noted that they have 580,000 LTE subscribers currently, which represents about 6 percent of their overall subscriber base. This contrasts with the much, much bigger Verizon, which boasts a 9 percent LTE adoption rate. It’s not bad to be 3 points behind the nation’s largest carrier (which has the nation’s largest LTE network). MetroPCS also boasted 1.5 million handset upgrades in the first quarter, a sign that they are doing a good job retaining customers. True to that, churn was at 3.1 percent, down from the fourth quarter of 2011 and even with last year’s Q1. Metro also boasts that nearly 50 percent of their subscribers are on smartphone plans.

Any time a company misses its estimates it will mean some negatives to come. But MetroPCS did report some positive signs. They did also warn of lower than expected numbers, thanks to a March rebate plan. The second and third quarters are typically slow for wireless, so it will be interesting to see how MetroPCS fares as they lead up to their ultimate goal of offering cheap LTE smartphones to nearly their entire coverage area.

Via FierceWireless.