How Verizon, AT&T, T-Mobile, Sprint and more stacked up in Q1 2016: The top 8 carriers

quarterly earnings

The first-quarter earnings season is coming to a close, so now it's time to see how the nation's top wireless carriers stacked up against each other in terms of key metrics.

In this report you will find a ranking of the of the top eight U.S. wireless carriers in the first quarter of 2016 by subscriber base, according to research firm Strategy Analytics. You'll also find charts of other major metrics -- such as churn, ARPU and revenue -- of each carrier.

Below that, Jackdaw Research analyst Jan Dawson provides several slides that offer an in-depth look at how Verizon Wireless (NYSE: VZ), AT&T Mobility (NYSE: T), T-Mobile US (NYSE:TMUS) and Sprint (NYSE: S) each performed in the first quarter of 2016. Dawson's research dives into prepaid vs. postpaid performance, subscriber acquisitions vs. losses, and more. And we've also got some data on capital expenditures from MoffettNathanson.

Further, don't forget to check out the top 12 wireline providers from FierceTelecom for the first quarter, and the top nine cable, satellite and telco pay-TV operators in the first quarter from FierceCable.

So what are you waiting for? Dig in!

Top US Wireless Carrier Metrics Q1 2016 (ranking by subscribers, retail + wholesale)
  Carrier Subscribers
(millions)
Net Adds
(millions)
Postpaid
Smartphone
Net Adds
(mil)
Blended
Churn
(Avg
Monthly)
Blended
Retail
ARPU
1 Verizon Wireless 141.473 1.377 0.284 1.22% $47.49
2 AT&T 130.445 1.781 0.185 1.42% $52.70
3 T-Mobile US 65.503 2.221 1.065 2.23% $41.97
4 Sprint 58.348 0.445 0.274 2.98% $43.97
5 US Cellular 4.926 0.050 0.074 1.66% $46.39
6 C Spire* n/a        
7 Shentel 0.458 0.002 0.005 2.64% $50.82
8 Ntelos* 0.305 0.003 0.005 2.86% $45.37
Subscribers include retail and wholesale connections of both traditional and new connected device categories (e.g. M2M).
Verizon Wireless subscribers include Strategy Analytics' estimates for wholesale and connected device volumes.
Sprint subscribers and net adds exclude affiliate subscribers, but include wholesale.
Blended Retail ARPU is derived from reported postpaid and prepaid retail/branded ARPU, unless reported separately by carrier.
T-Mobile postpaid smartphone net adds, blended churn and blended ARPU are estimated or derived by Strategy Analytics
*C-Spire is a private company and does not reveal its metrics, estimated to have c. 1.0 million subscribers.
nTelos Q1 2016 figures estimated by Strategy Analytics.
Source: Strategy Analytics, based on carrier reports

This list does not include resellers or MVNOs such as TracFone Wireless. (To see how TracFone did in the first quarter, click here.) And don't forget to see how these figures stack up against the fourth quarter of 2015. You also might want to check out our wrap-up of the wireless industry in the first quarter of 2016.

Strategy Analytics also provides a look at historic trends in the wireless industry in several key metrics:

StrategyAnalytics-Q1-2016
StrategyAnalytics-Q1-2016-2
StrategyAnalytics-Q1-2016-3
StrategyAnalytics-Q1-2016-4

In addition, the analysts at MoffettNathanson check in with a look at the carriers' quarterly capex spending and how that looks for the first quarter compared with previous quarters

Moffett-Q1-2016-FW

And beyond these standard metrics, Dawson provides a deeper look. Thanks to a partnership between Dawson and FierceWireless, we're publishing these slides exclusively for a short time. These slides are part of a larger report Dawson has assembled on the first quarter. Dawson's quarterly slide deck, with about 40 charts, is available as part of a subscription service. In addition, he provides the underlying data behind the charts along with his analysis in custom presentations to certain clients, including carriers and device vendors. Dawson can be reached at [email protected] or (408) 744-6244.

Check out Dawson's first quarter slides and commentary below, and let us know what you think in the comments!

Smartphone sales down for the second consecutive quarter

Last quarter saw the first year on year drop in smartphone sales in the US, and this quarter saw the second. The drop wasn't as dramatic this time around, but it's worth examining the drivers, because they suggest this trend will continue. On the one hand, the postpaid upgrade rate – the percentage of postpaid phone customers upgrading their handset in the quarter – dropped year on year for all four carriers, in some cases by 1.6 percentage points. AT&T hit a new low of just 5% in the quarter, and saw under 25% of its base upgrade over the past four quarters combined. But it isn't just that people who have smartphones are upgrading them less frequently – there are fewer new smartphone customers too. In the year to March 2015, the four major operators added 16.7 million new postpaid smartphone customers, but in the year to March 2016, they added just 12.7. Both of these factors are driving a decline in postpaid smartphone sales, and though prepaid smartphone sales are holding up better, it wasn't enough to prevent the second decline in overall smartphone sales among the five operators that are part of this analysis.

Jackdaw-Q1-2016

Postpaid phone adds meager except at T-Mobile

Once again, T-Mobile dominated the postpaid phone net adds among the major operators, adding 877 thousand new subscribers, while the other major operators either lost subs or added very few. Once again, Verizon lost postpaid phone subscribers in Q1 while adding a healthy number throughout the rest of the year, as its lower promotional activity combined with stronger prepaid competition skimmed off low-end subs, though only very few this time around. Sprint was positive for the third consecutive quarter, but only just, with 22 thousand new subs. AT&T, meanwhile, lost postpaid phone subs for the sixth consecutive quarter. Overall, the operators added slightly more postpaid phone subs this quarter than a year ago, with 528 thousand versus 368 thousand, but Q1 was a low point once again relative to the rest of the year. 

Jackdaw-Q1-2016-2

Tablet growth takes a hit as giveaways come back to bite operators

Tablet net adds have been fading somewhat over the past eighteen months or so, but this quarter they were particularly hard hit as giveaways at Sprint and Verizon two years ago came back to bite those operators. It turns out that customers who took a flyer on a free tablet back then have since discovered they don't want to pay for the associated service contract, and have canceled them once the contract is up. Sprint reported the first negative tablet net adds of any operator this quarter, with a loss of 36 thousand subs, while Verizon's dropped from 820k a year ago to 507k this quarter, its lowest number for at least three years. The four operators combined added just over 900 thousand tablets this quarter, compared with over two million a year ago. This is particularly significant because tablets have been one of the fastest-growing other categories even as postpaid phone growth has slowed. The recent trends suggest that operators will have to continue looking elsewhere. The good news is that, for those operators serving this market, connected devices growth continues to be strong – net adds in that category outpaced every other category (postpaid, prepaid, and wholesale) for the first time this quarter, with 2.4 million.

Jackdaw-Q1-2016-3

A bifurcation in the prepaid market

Another trend we're seeing is an increasing bifurcation in the prepaid market. I've talked in past quarters about the slowdown in growth in the prepaid market, but it's now becoming clear that there are important differences between the carriers in this market too. Over the last several quarters, AT&T and T-Mobile have been driving their prepaid sub-brands (Cricket and MetroPCS) hard and have seen significant success in gaining new subscribers. However, Sprint and Verizon have seen increased losses during that period, and TracFone – the largest prepaid operator – has also seen a significant slowdown. This quarter, AT&T and T-Mobile combined added 1.3 million new prepaid subscribers, while the other three operators combined lost around 900 thousand. Verizon (which was never hugely committed to prepaid) appears to have largely given up on pursuing the market directly, and has now referred to its wholesale relationship with TracFone as being its main strategy for prepaid. TracFone has seen perhaps the most dramatic slowdown in its prepaid business – in the last eight quarters it lost a net 300 thousand subscribers, whereas in the previous eight quarters it had added 5.4 million. The power in prepaid has shifted to the brands that can pursue it aggressively with a focused strategy, whereas other brands seem to be really be struggling.

Jackdaw-Q1-2016-4
How Verizon, AT&T, T-Mobile, Sprint and more stacked up in Q1 2016: The top 8 carriers