(Reuters) -T-Mobile US on Wednesday raised the lower end of its annual free cash flow forecast after quarterly subscriber additions and earnings topped estimates as customers flocked to the company’s more affordable plans.
Wireless carriers have been vying for customers who have been tightening their purse strings, including delaying phone upgrades that have hit purchases of bundled plans, amid mounting concerns about an economic slowdown.
Shares in the Bellevue, Washington-based company rose nearly 2% in premarket trading.
Fewer customers switching operators and solid promotional activity along with migration to higher-tiered unlimited plans also helped T-Mobile drive subscriber growth.
T-Mobile now expects adjusted free cash flow for the year to be between $13.4 billion and $13.6 billion, compared with its prior forecast of $13.2 billion to $13.6 billion.
The company added 850,000 postpaid phone customers in the third quarter, the highest among peers, beating FactSet estimates of 773,400 additions.
The company also raised its full-year forecast for wireless subscriber growth and now expects net additions of 5.7 million to 5.9 million, up from its earlier forecast of 5.6 million to 5.9 million.
T-Mobile has been trying to outdo peers with its bundled deals following the recent launch of the iPhone 15.
However, analysts have said overall industry promotions have been less aggressive compared with those offered following the launch of iPhone 14 last year.
T-Mobile’s total revenue for the three months to September stood at $19.25 billion, compared with analysts’ estimates of $19.32 billion, according to LSEG data.
Excluding items, the company earned $1.82 per share, beating Wall Street expectations of $1.74.
Rivals Verizon and AT&T both raised their annual free cash flow forecasts after attracting more subscribers than expected in the third quarter.
(Reporting by Samrhitha Arunasalam in BengaluruEditing by Vinay Dwivedi)
