MetroPCS and Leap Offer Diverging Reports

February 26th, 2010 by · Leave a Comment

Two very similar wireless operators had very different days yesterday.  MetroPCS (NYSE:PCS, news, filings) enjoyed some real sunshine, reporting revenues of $930M, adjusted EBITDA of $251M, and earnings per share of $0.09 – all three of which were above analyst estimates.  Net customer additions and ARPU were both up.  

But just next door, Leap Wireless (NASDAQ:LEAP, news, filings) turned in revenues of $599 and earnings per share of -$0.82.  Unfortunately the market had numbers in mind more in the neighborhood of $633M and -$0.65.  Both net customer adds and ARPU were down.  They also settled the class action suit over the 2007 restatement for a cool $13.75M – as usual, a pittance for shareholders but a nice trip to Tahiti for the lawyers.

Churn remained high for both companies, suggesting that it’s very tough out there.  Clearly in Q4 Leap got stepped on a bit competitively, as MetroPCS and Sprint’s Boost moved more aggressively and took some market share.  I wonder if the relative performance makes the frequently rumored potential merger between Leap and MetroPCS more or less likely over the next quarter or two.   I suspect the likelihood went up some, but things can change quickly on the ground – they might have already, who knows.

If you haven't already, please take our Reader Survey! Just 3 questions to help us better understand who is reading Telecom Ramblings so we can serve you better!

Categories: Financials · Wireless

Discuss this Post

Leave a Comment

You may Log In to post a comment, or fill in the form to post anonymously.

  • Ramblings’ Jobs

    Post a Job - Just $99/30days
  • Event Calendar