América Móvil's U.S. revenue jumps 9% despite subscriber losses

América Móvil's TracFone is the largest MVNO in the United States.

América Móvil’s net profit nearly doubled in the second quarter thanks largely to postpaid wireless growth and favorable currency exchange rates. And Carlos Slim’s massive telecom saw U.S. revenues grow even as the company's customer base there shrank.

“We ended the quarter with 24.1 million subscribers—4.8% below the year-earlier quarter—after net disconnection of 636,000 subs, resulting from a cleanup of our base, from increased competition in the segment and from seasonal effects,” the company said in its earnings release (PDF). “Our second-quarter revenues totaled $1.9 billion; they were up 8.8% year-on-year, with equipment revenues jumping 20.8% and service revenues rising 7.1%, mostly on the back of data services that increased almost twice as fast.”

América Móvil operates TracFone, which is the largest MVNO in the United States and is in the midst of a steady—if modest—retail expansion. TracFone brands include Simple Mobile, GoSmart, TracFone, Net10, PagePlus, Total Wireless and SafeLink.

Sponsored by Ciena

Because you asked. Adaptive IP™

There’s a new way to modernize and expand your IP-based networks—from access to metro—that’s automated, open, and lean.

T-Mobile last October confirmed that it recently sold its Walmart Family Mobile business to TracFone, giving the prepaid service provider a massive presence in the world’s largest retailer. Walmart Family Mobile brought TracFone an additional 1.4 million customers, according to Wave7 Research.

“Our financials reflect the consolidation of Walmart Family Mobile’s figures from August 2016,” América Móvíl said this morning. “Adjusting for that, revenues would have risen 4.7% over the year and EBITDA would have trebled.”

The Mexico-based telecom said ARPU among U.S. customers came in at $23, up 10.6% year over year, and churn inched upward from 4.3% a year ago to 4.4%. Overall, the company reported a net profit of $818 million for the quarter, up 86% from the year-ago period.

América Móvíl is hoping its recent brick-and-mortar initiative can help TracFone claw back some market share in a brutal U.S. prepaid segment. TracFone lost 1.4 million prepaid customers in the first quarter of 2017, marking a 3.3% drop year over year, primarily due to customers leaving SafeLink Wireless, which provides services through the Lifeline program under the federal government’s Universal Service Fund.

Suggested Articles

Norway’s Telenor ditched Huawei in favor of Ericsson for 5G RAN, but Telefónica tapped the Chinese vendor for 5G RAN in Germany and 5G core in Spain.

Samsung Electronics is expanding its North American presence in wireless infrastructure, striking a deal with Canadian telecom operator Videotron.

AT&T said its 5G service, for both consumers and businesses, is now live in 10 markets.