U.S. Cellular posted a wider profit, but its subscriber base declined substantially and it lost a significant amount of roaming revenue compared with the year-ago quarter. The carrier, which operates in 26 states, reported profit of $83.4 million, up 15 percent from $72.6 million in the year-ago quarter. U.S. Cellular blamed both the weak economy and an intensely competitive market for its decline in subscribers. "The launch of the latest iPhone and other exclusive handsets was a factor, as was the increased presence and competitiveness of low-priced, prepaid service providers in some of our markets," U.S. Cellular CEO John Rooney said in a statement.
Revenue: Total revenue decreased slightly to $1.04 billion, down 1.7 percent from $1.06 billion in the year-ago quarter. Service revenues were $974.8 million, down from $987.4 million in the year-ago quarter. Data revenue increased 31 percent to $162 million, making up 17 percent of service revenue. Interestingly, the company's inbound roaming revenue declined to $62.2 million in the quarter, down from $84.2 million in the second quarter of last year. U.S. Cellular said this was primarily due to Verizon's acquisition of Alltel.
Net adds: The company lost 88,000 net subscribers in the quarter, compared with 47,000 net additions in the first quarter and 16,000 net additions in the year-ago quarter. U.S. Cellular ended the quarter with 6.155 million subscribers. The carrier retracted its forecast for retail subscriber additions for the rest of 2009 due to economic uncertainty.
Churn: Postpaid churn was 1.7 percent in the quarter, up from 1.5 percent in the first quarter and 1.4 percent in the year-ago quarter.
ARPU: ARPU in the quarter was $52.41, down slightly from $52.54 in the first quarter and down from $53.27 in the second quarter of 2008.
For more:
- see this release
- see this Dow Jones Newswires article (sub. req.)
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