Both T-Mobile and Sprint declined to hold quarterly earnings calls this week, heightening expectations the carriers may announce a proposed merger in the next few days.
T-Mobile unexpectedly released third-quarter results this morning, slightly topping Wall Street estimates for quarterly profit but falling shy of expectations for postpaid phone net additions. But the operator decided not to hold a conference call with analysts to discuss its earnings, opting instead to post a video of CEO John Legere touting its results for the period.
“(W)ith all the rumors and speculation out there, we decided that we wanted to make sure you all saw and focused on our Q3 results and not just on the rumors and speculation that seem to fill the news every day,” Legere said in the video.
Similarly, Sprint said this morning it will announce it quarterly earnings Wednesday but will not host a conference call. Earnings call are typically scheduled weeks in advance, so it isn’t surprising that analysts saw the moves as a sign that an announcement of a proposed merger could come any day.
“As recently as two weeks ago, it was expected that T-Mobile and Sprint would release their earnings on the same day, with an accompanying merger announcement,” Craig Moffett of MoffettNathanson Research wrote in a note to investors. “Last week, however, it was suggested that a merger announcement might now be delayed by a few weeks. That left room for both to announce earnings in a more normal fashion.
“Well, there’s nothing normal about announcing on a Sunday afternoon that one’s earnings will be released the next morning… sans conference call,” Moffett continued. “Inevitably, the speculation about why T-Mobile chose to do it this way—does this mean that a merger announcement is imminent, or does it mean that talks have reached a temporary impasse (we’re assuming it means the former)?—will dominate discussion today. The results will naturally take a back seat.”
Roger Entner of Recon Analytics took a similar view, inferring that news of a tie-up could come later this week.
“Sprint just announced earnings call on Wednesday also without Q&A… The plot thickens,” Entner said via Twitter. “When will we have the @sprint @TMobile merger/acquisition announcement? Thursday? Friday? Can’t be too long after this.”