TracFone finishes Q1 with 18.5 million subs

Cut-rate MVNO TracFone is attracting a strong number of subscribers to its low-cost prepaid service plan. The company, a unit of América Móvil, added 780,000 new subscribers in the first quarter, bringing its total subscriber base to 18.5 million--an increase of 19.9 percent in the period. However, the number of its new subscriber additions is down slightly from the previous year's quarter, when TracFone reported adding 1 million subscribers.

Nevertheless, the company's revenues are increasing. TracFone reported revenues of $868 million, up 43.4 percent from a year ago. It also reported that its average revenue per user increased 27.8 percent to $14 per month. The company's minutes of use also increased 131 percent over the previous year to 354 minutes per subscriber.  

The company's EBITDA was $63 million, down from $77 million in the year-earlier quarter. TracFone's EBITDA margins also decreased to 7.3 percent from 12.7 percent.   

TracFone is facing increasing competition from traditional operators. Last week Verizon Wireless (NYSE:VZ) launched a major new service dubbed "Verizon Unleashed," which offers prepaid unlimited wireless calling, texting and data for $50 per month. The service is a direct attack on MVNOs like TracFone. However, Verizon's plan is currently only available in Southern California and parts of Florida.

For more:
- see this article

Related Articles:
TracFone adds 1M customers in Q1
Verizon Wireless details Unleashed $50 prepaid unlimited plan
AT&T will support Straight Talk prepaid service
TracFone posts 1.1M net adds in Q4; Alltel to sell Samsung Gem

FREE DAILY NEWSLETTER

Like this story? Subscribe to FierceWireless!

The Wireless industry is an ever-changing world where big ideas come along daily. Our subscribers rely on FierceWireless as their must-read source for the latest news, analysis and data on this increasingly competitive marketplace. Sign up today to get wireless news and updates delivered to your inbox and read on the go.