Shares of Tucows surged after the operator of Ting Mobile posted a third-quarter profit of $4.7 million.
The Toronto-based firm reported $18.4 million in mobile services revenue during the latest quarter, up from $15.4 million during the same period last year. Ting Mobile added more than 3,000 accounts and 8,000 devices during the quarter, executives said; the MVNO now boasts 147,000 accounts and 235,000 devices.
Ting Mobile provides mobile and fixed-line services as well as domain names. It uses Sprint's network but in late 2014 added support for a GSM network, almost surely T-Mobile's.
“Continued growth in both Ting Mobile and Domain Services drove a year-over-year increase in overall revenue of 11 percent to just shy of $50 million. Net income and adjusted EBITDA were up 50 percent and 48 percent respectively as a result of the significant operating leverage in our business,” CEO Elliot Noss said during an earnings call, according to a transcript from Seeking Alpha.
Churn was 2.8 percent, up notably from the 2.4 percent Ting posted in the second quarter. But investors cheered the performance, sending Tucows shares up nearly 10 percent by mid-morning Tuesday.
Ting acquired MVNO Platinum Wireless earlier this year, then lost 1,000 former PTel customers after Ting shuttered its former rival. PTel Mobile, a T-Mobile MVNO, quietly closed its doors after 15 years in business in February; Ting had sought to span up PTel’s customers with offers of free Ting service.
Noss said the competitive landscape was relatively placid during the third quarter, but added that he expects competition to increase in the coming months as cable operators begin to elbow their way into the market. Both Comcast and Charter Communications have signaled their intentions to launch wireless services to offer a comprehensive telecom package.
“With respect to the sort of the entrance of the MSO cable companies into the mobile space, I flagged I want to say, a quarter or two ago that will be the next big competitive change in this industry,” Noss said. “I think if you want to understand what we're looking for we think more or what they offer is like the existing experience and the lower the price, the more concerned we are and the more sort of promoting Wi-Fi first or calling and the less competitive the price; the less worry we are; and those are two variables that we'll be watching most closely.”