Shares of U.S. Cellular remained generally flat after the company met financial expectations but enjoyed positive postpaid net phone additions in the latest quarter.
The Chicago-based carrier reported $963 million in total operating revenues during the second quarter, down from $992 million during the same period a year ago. Adjusted earnings of 17 cents per share came in exactly where an average estimate of three analysts surveyed by Zacks Investment Research pegged them, the Associated Press reported.
“Although the current pricing environment and the investments we made in growing our customer base impacted short-term profitability this quarter, we were able to minimize those impacts through our ongoing cost management initiatives,” CEO Ken Meyers said in the earnings release. “Lower roaming rates, continued customer adoption of equipment installment plans, and cost reduction initiatives drove a decrease in cash expenses even as data traffic increased 51% on a year-over-year basis.”
U.S. Cellular added 19,000 postpaid net phone customers during the quarter, rebounding from a first quarter in which it lost 28,000 such users. The company saw an additional 4,000 net postpaid connected devices, and postpaid phone churn dipped to .91%.
Meyers attributed the customer additions and lowered churn to the company’s February launch of unlimited plans.
“We had a successful quarter building on our number one objective—protecting and growing our customer base,’ he said. “Our Total Plans, which include an unlimited data option, have been effective in both attracting new customers and meeting the needs of our current customers.”
Meyers also noted that U.S. Cellular completed its first commercial rollout of VoLTE in the second quarter, bringing the service to its customers in Iowa. The carrier will continue to deploy the technology throughout its footprint into next year.
“VoLTE brings benefits such as simultaneous voice and data sessions to customers as well as additional opportunities for roaming revenues,” he said.